Introduction
About 17 million members of Generation Z are now adults and starting to enter the US workforce, and employers haven’t seen a generation like this since the Great Depression. They came of age during recessions, financial crises, war, terror threats, school shootings, and under the constant glare of technology and social media. The broad result is a scarred generation, cautious and hardened by economic and social turbulence.
In the midst of this new generation entering the workforce, the high demand for productive talent has created a very low unemployment rate of 4.0% as recently as December 2018 (Brainerd, 2019, p. 3). As of July 2020, though, unemployment has shifted to a higher rate due to COVID-19, and these numbers could temporarily affect Generation Z’s ability to get a job once they graduate from college. Companies looking for growth and development need to adapt to this new generation and meet their needs. Whether through alternative manager training or higher wages, motivating Generation Z to stay with a company long-term is crucial for companies to meet their objective and save money on retention programs.
Significantly, at the time of this writing, a Gallup study found that 21% of millennials surveyed say they’ve changed jobs within the past year, more than three times the number of non-millennials. For businesses, this suggests that half of their millennial workforce does not see a future with them. 60% of millennials say they are open to a different job opportunity, and 36% report that they will look for a job with a different organization in the next 12 months if the job market improves (Adkins, 2016, p. 4). Millennial turnover costs the US economy $30.5 billion annually.
Altman (2020) outlined that the actual cost of attrition at a company can be significant, confirming the trend Bersin (2013) studied, showing that the total cost of losing an employee can range from tens of thousands of dollars to 1.5-2X annual revenues (p. 4). This serious issue is further affected by the ever-increasing need for talent. If companies can retain employees by accommodating the wants and needs of an incoming generation, they will save money on recruiting and training costs.
This study aims to understand what companies can do to create a motivating and engaging workplace to retain Generation Z employees. A recent Stanford report (De Witte, 2024) clearly outlines a set of values and expectations that will shape tomorrow’s workforce, noting that Generation Z will “…not tolerate unpleasant workplaces that do not allow them to be their authentic selves in expressing their personal and family values.” While we are living longer and retiring later, Kelly (2023) points out that up to five generations of employees now have to learn how to work together under one roof. With so many generations with different working styles in one workplace, it is critical to understand Generation Z and what they can offer the organization.
In the following sections, I will first review the existing literature on Generation Z in the workplace and how technology has defined and shaped this generation’s professional and personal expectations.
Next, I will outline our research methods and, based on the data we collected, evaluate the significance of the findings. Last, I will complete this study by providing strategic recommendations that could benefit organizations recruiting Generation Z or currently employing them.
Literature Review
This section briefly reviews the existing literature on Generation Z to determine commonalities and disagreements on the topic.
Born between 1995 and 2009, Generation Z’s oldest members are just beginning to enter the workforce full-time (Whitt & Willard, 2012). It is the largest generation in America, comprising 72 million members and about 25% of the population. With this large population comes spending power, estimated to range between $29 - $143 billion (Uche, 2018).
Generation Z is exceptionally diverse compared to preceding generations: “Biracial and multiracial children are the fastest-growing segments in the United States. The LGBTQ community is expanding, as the secrecy associated with sexual orientation is not as prominent as in previous generations” (Turner, 2015, p. 104). Additionally, Generation Z children are growing up in urban areas more so than generations before, exposing them to numerous cultural perspectives (Turner, 2015). Companies that emphasize Diversity and Inclusion in their organization are well aware of this new generational distinction, as indicated recently in a WEF Lighthouse Program report (2023).
Generation Z is realistic. Having grown up in the aftermath of 9/11, this group has never known a world in which terrorism or the war on terror was not a collective concern. Additionally, the Great Recession has influenced Generation Z to adopt a more pragmatic mindset when planning for the future, as an extensive 2000-2021 ASA research study indicated (ASA, 2012). Moreover, frequent school shootings have also shaped the mindset of this group, leading them to believe that nowhere is entirely safe (McGaha, 2018).
One study done in the classroom found that Generation Z students take in information instantly but can lose interest in it just as quickly, that their attention spans have shrunk to eight seconds, and that they are allegedly unable to focus for extended periods of time. Although this report may sound negative, this shifting attention trait may have a positive spin if we consider Generation Z to have an adaptive “highly evolved eight-second filter” characteristic that enables them to sort through and assess enormous amounts of information quickly. This feature creates the need to provide Generation Z students with engaging and immediately beneficial experiences (Cameron & Pagnattaro, 2017, p. 318).
Generation Z is the first generation born into a world where many physical aspects (people and places) and virtual reality naturally overlap. In other words, virtual is simply part of their reality (Mardoyo et al., 2024; Stillman & Stillman, 2017).
Mendoza (2019) describes Generation Z as having their main learning experiences outside of formal education due to the ubiquitous presence of the Internet in their life. It leads to a can-do attitude since they have always been able to look up how to complete almost anything on their own through websites such as YouTube. Contrary to a very collaborative Millennial generation, Stillman and Stillman (2017) define Generation Z as independent and looking after themselves for help rather than others. Bencsik et al. (2016) summarize some of the challenges HR teams face since Millennials and Generation Z appeared in the workplace in Table I.
Citing a 2016 Cone Communications industry report comparing Generation Z’s influence of Corporate Social Responsibility (CSR) versus millennials and Generation X, Uche (2018, p. 22) emphasizes that the research showed that 92% of Generation Z care about social and environmental issues but are frustrated with the current public policies. Generation Z believes that brands have the power to drive social change and should address current social and environmental issues. They want to purchase products and services that are socially responsible. It is up to companies to communicate their “activities in a unique and creative way” (Uche, 2018, p. 29). Further, Generation Z expects to partner with their employers to fix the wrongs they see in the world (Stillman & Stillman, 2017).
Few research studies are available on what companies are currently doing to accommodate Generation Z. Nonetheless, Koulopoulos and Keldsen (2016) found that IBM put in place a Results-Oriented Work Environment (ROWE) that has already produced $700 million in savings and a 50% higher productivity rate. Hyatt has become a desirable place to work because it uses a new design thinking process to break generational walls down. Cisco changed how it fosters collaboration between generations with a reverse mentoring model. However, only 15% of the companies they surveyed had implemented similar programs.
Stillman’s (2017) nationwide study of Generation Z reveals that 91% of the respondents said that a company’s technological sophistication would influence their decision to accept a position at the firm. A McGaha’s (2018) study focusing on members of Generation Z who graduated from college and entered a corporate workforce found that they picked their new job because of the leadership within the organization or the expected work environment. As a participant said in an interview: “Right now, the job I’m doing is not super important. The person who is going to be my superior might be the deciding factor [in choosing a job]” (Mendoza, 2019).
While working with hundreds of small businesses, ranging from renowned, global companies to not-for-profits, Koulopoulos and Keldsen (2016) found that the greatest challenge to effective collaboration in the workplace is this generational divide. As many as five generations could work side by side in an office together.
Research Methodology
We followed Creswell’s (2018) advice to understand what Generation Z is looking for in the workplace and how much thought Human Resource teams have given to attracting and retaining new talents. He suggests that “an exploratory qualitative study anchored in the collection of real data allows us to develop broad themes and generalize models or theories.”
We determined to base our field research on 15 individuals who categorized themselves as members of Generation Z and 15 individuals who worked in an HR department.
To participate in the study, Generation Z individuals had to have graduated college within the past year or be approaching graduation within two years. They had to have been in the workforce for at least two years.
All interviews were conducted after receiving consent. Participants could freely discuss and exchange information at will without concern for consequences.
This researcher’s initial presumption was that HR reps did not know the difference between this new generation and Millennials. However, it quickly emerged that this was not an accurate assumption, as almost half of them did. Nonetheless, as the literature review indicates, many companies are unprepared for the next generation and the differences they will bring to the workplace.
Another assumption was that Generation Z would not know what they wanted in the workplace and, therefore, would be unable to explain what is important to them. This assumption was incorrect as well. 100% of Generation Z participants who were interviewed had an answer for what was important to them in the workplace.
The interview was conducted from December 2019 to May 2020. Based on previous similar protocol recommendations (Stillman & Stillman, 2017), here is the list of questions selected for the questionnaire:
Results
A. Generation Z
Table II below highlights the responses obtained from the Generation Z participants.
Overview
The most common response when looking for a first job was an organization that invested in their growth and development. 40% of respondents were interested in looking for organizations that would develop them for the long term.
However, none of the interviewees directly stated a promotion as a sign of growth and development but instead focused on the chances of personal development within the organization. For example, one respondent was interested in growing through challenges: “Besides the pay, a learning environment mattered. I didn’t want something easy and just given to me, but I wanted a challenge and to learn from my boss.” Another stated they were searching for “somewhere where you can grow and not be pigeonholed to one field or area of expertise.” An interesting caveat is that very few participants mentioned if they had previously been interning in the place where they worked full time or stayed with the organization because they saw the opportunity to develop.
According to Boland (2019), Generation Z is more willing to live with their parents after college to save money instead of spending their money on rent in expensive cities. However, we found that location was an essential factor in their decision-making process. The participants this researcher interviewed were motivated to search for jobs by location. Many mentioned big cities such as Chicago, Los Angeles, Washington, D.C., and New York as ideal places to live and were more than willing to pay for it. One interviewee pointed out: “I wanted to graduate and immediately move to D.C. so that I could keep being around people my age. I was willing to pay the high rent so I could be happier.” These themes can be found in greater detail in Table III.
Financial Expectation
The second set of questions covered stability, opportunities, and financial expectations.
The result showed that 86% were motivated by higher salaries, 53% by the opportunity to grow, 33% were interested in benefits, and 6% were interested in brand recognition.
The literature review agrees that financial stability is a motivating factor for Generation Z, which was confirmed in this study, as 86% of the participants interviewed mentioned it being necessary due to the cost of a college education. When asked what would trigger changing companies, the most common theme was offering higher pay. One participant said, “I want a higher income to pay off my student debt.”
Previous research asserted that Generation Z is not risk-takers and is more likely to stay at a company long-term to live recession-proof lives (Adamy, 2018). This study did not support that thesis. We found a common motivation to leave a company, next to a higher salary, was the opportunity to grow.
Connectivity
Concerning the dynamics of the work environment, 40% were looking for a relatable relationship with management and peers, while 33% valued challenges and transparency. The most common want out of a manager was that they took the time to build relationships and ask questions about personal life. This may indicate that, possibly because of their age, Gen Zers often blur the line between work and personal life. One participant stated, “A lot of [my expectations] is finding someone who is willing to get to know me as a person and knows my skill set and weaknesses. Someone I can be open and comfortable communicating with.” These themes are shown in Table IV.
Empathy and putting people first emerged as close second priorities in their choices. While growth and development motivate Gen Zers, they do not feel they can develop to their full potential without a manager comfortable enough to challenge them in areas where they need to improve.
The final questions opened up to larger concerns such as working towards a common goal, impacting society, parental pressure, and intrinsic and financial stability. The two most common themes among the participants were that they were intrinsically motivated and wanted to impact Society. 46% hoped to influence society and their work environment positively, and 26% were looking for financial stability. Only 6% mentioned teamwork and working for a common goal as a determining drive. These are outlined in table V.
HR Reps Knowledge Overview
The following section transitions to the HR Reps interview and briefly reviews the data collected. The initial series of questions were based on the reps’ knowledge and understanding of this new generation entering the workforce in their businesses. The data is summarized in Table VI.
40% of the interviewees mentioned they were familiar with entry-level Generation Z. Also noticeable: 40 % mentioned they were not familiar at all, and another 20% were only vaguely familiar with these workers’ needs and expectations. One comment summarizes our findings well: “In the supermarket, I see Gen Zers with their dads doing TikTok dances. I think the thing right now is there is an obsession with TikTok. This individual works with Generation Z, but because they are a few layers above them in the organizational chart, their interactions are limited to day-to-day experiences outside of work.” These themes are discussed in Table VII.
Gaps in Technological Knowledge & Communication
The next series of questions focused more directly on specific issues such as digital literacy, technological gaps, communication, the amount of guidance needed to perform, different views on life, and mutual respect—all criteria directly affecting businesses’ productivity, growth, and retention. These themes are discussed in detail in Table VIII.
46 % of the responses show that the participants were well aware of the technological gap, particularly in communication. However, it is significant that only 6% of them believe Gen Z are agents of positive change and do not seem interested in understanding this new generation of coworkers. As one participant said: “Young salespeople, for example, want to run automation and send tons of cold emails and A/B tests, whereas older ones want to get drinks and dinner to do business.”
Factoring the difference in Millennials’ and Generation Z’s attitudes toward work, 40% admired the technological savvy of Gen Z, while 20% considered Millennials more risk-takers. They conclude that Generation Z works smarter, not harder, than other generations; they are just more digitally literate in the workplace.
In an earlier research, Mendoza (2019) mentioned how websites like YouTube created an environment where Generation Z could always figure out how to complete almost anything independently. Generation Z are digital natives and, because of this, know how to find directions to tasks almost instantly. HR reps reported that they often found that digital literacy, which is crucial for the development of any corporation, including research, inventory accounting, marketing, and promotion, was often frowned upon and almost considered a threat by many millennials and older generations.
However, many noticed that Gen Zers were more motivated to succeed and work their way through the ranks than the generations before them.
The final series of questions, detailed in Table IX, encompassed what motivates Gen Z workers, including gratification, making a societal impact, belief in the organization’s mission, recognition, and working for a recognizable brand. In many aspects, the answers provided reflect the participants’ lack of curiosity about the potential benefits of this new workforce for the company.
Whether it is symptomatic of the profession or particular to the individual we interviewed, 47% believed instant gratification is their primary motive. Only 13% believe the generation gap and poor communication may lead to a lack of respect for their potential. Such an assessment may undermine the effort of the company that hired them in the first place.
Discussion and Recommendation
The purpose of this study was to understand what organizations could do to create a motivating and engaging workplace to retain Generation Z.
Uche (2018) reported that “Gen Z believes that brands have the power to drive social change and should address current social and environmental issues” (p. 29) and that 92% of them care about these issues. Generation Z may feel that big brands have the capital to make lasting changes in the world and, therefore, would provide them with the opportunity to do so themselves.
To support our objective and provide information that can be acted upon, we collected data to understand what Generation Z was looking for in the workplace and how much thought Human Resource teams have given to attracting and retaining talent that identifies as Generation Z.
This research does not provide definitive answers, but it does offer insight into Generation Z’s workplace wants and needs and how those align with what companies currently know about them.
To summarize, the data collected from 30 separate interviews, technology, and an interconnected world are the basis for what Generation Z wants in the workplace and what companies need to address to attract and retain them.
Generation Z is intrinsically motivated to impact society and, because of their familiarity with technology, will be attracted to a digitally native company. The information we collected confirms the research done by Bencsik et al. (2016) that highlights how vital technology is to Generation Z because they grew up with it and aligns with the conclusion presented by this research.
As stated earlier, Generation Z cares about brand recognition and values companies that make a positive impact on society. Because of their widespread access to information through the Internet, they know the impact these brands have and prefer to work for a company whose reputation is based on positive societal change.
Generation Z will not be attracted to a company that is not digitally literate or has no recognizable brand. Additionally, managers who do not put their people first by getting to know them before investing in their growth and development will have trouble retaining them. Technology and interconnectivity provide a new level of transparency and make them well aware of where and what companies invest for their growth and development. They probably will have no incentive to stay with a company that does not invest in them.
The data collected from human resources representatives shows that they are well aware of the challenges of seamlessly integrating this new workforce into the company. Most are prepared to address Generation Z’s needs and engage them more effectively in the workplace.
They recognized that these new workers, being digital natives, mostly need older generations to show a modicum of respect for their talent and value brands that put people first.
Limitations
We identified several limitations in the research process worth noting because of their impact on our findings:
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All interviewed Generation Z participants were college graduates. However, a significant number of non-college members may have different wants and needs worth exploring in future research.
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The second group of participants was all in the Human Resources department, and they may have had different levels of interactions with Generation Z. Other coworkers may have been better equipped to answer our questions.
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COVID-19 possibly affected the participants’ responses regarding their wants and needs. Given the poorly performing job market as of May 2020, they likely just wanted any job available.
The results we obtained reevaluate and expand prior research in a fast-evolving field. As Generation Zers grow and progress in their careers, more information will provide a better sense of this multi-generational challenge in the workplace and how best to address it.
Conclusion
Proposing remediation practices to address shortcomings to increase a workforce’s effectiveness is exceptionally challenging. Circumstances may differ from business to business, and more importantly, human interaction is not as easily quantifiable as numbers.
The initial goal of this research was to identify a problem, offer a better understanding of the situation, and propose alternatives that could help ensure a frictionless integration of multigenerational workforces.
Companies determine their objectives based on shareholders’ priorities and achievable goals. Depending on their foresight, they may or may not prioritize the human component as a factor of development. Numbers are easier to control than people.
However, well aware of the human component as a development factor and its direct implications on growth and retention, companies have come to rely more and more on Human Services to address these issues from a practical and effective standpoint.
Some HR personnel’s tepid responses to our questionnaire suggest they may be well advised to be more proactive in gaining a better understanding of these new workers, their backgrounds, and whether their expectations are realistic. They should also implement processes that ensure their insertion into the workforce benefits the company’s growth going forward.
For example, creating programs that allow Generation Zers to interact with older generations is a favored option. Both have much to offer and learn from each other. It may address Generation Z’s concern for a company that does not recognize its contributions simply because they are too young. Personal assumptions such as instant gratification, technological proficiency, and communication habits are common to all generations. It could be the basis for developing a common understanding, sharing technical know-how, and contributing to everyone’s effort to contribute to the company’s welfare. Such programs, not always quantifiable in the short term, may have a long-term impact on the welfare of all employees and impact retention as well.
Similarly, our questionnaire confirms Adamy’s (2018) finding that Generation Z values financial security, like all workers. Multiple data show that they are looking for an organization that invests in their development and provides them with a manager who gets to know them before attempting to challenge and develop them professionally. Mentoring and tutoring are effective tools that could be promoted at all levels of the organization.
By highlighting Generation Z’s main concerns, this study will prove helpful for Organization Development (OD) practitioners in addressing a lack of talent coming to or staying at a company. There may be a deeper problem than a company that feels job hopping is a ‘generational problem.’ This generation is exposed to ‘greener grass’ on a very frequent basis, so an organization needs to manage its brand as well as invest in growth and development from the start of a new hire, or they will very quickly find a place that will.
While this exploratory qualitative study only covers a limited segment of the college graduate population, it is noticeable that today, all Gen Zers share a common culture acquired on the Internet. Further research may confirm that these common traits are shared across cultures and backgrounds. Industries that offer jobs that do not require college degrees could similarly benefit from addressing the integration issue with a better understanding of their younger employees and the multigenerational challenges that come with it (Perez-Chao & Pipic, 2024).
Ultimately, foresight and enlightened leadership will influence how to address issues that are, in essence, not very different from what managers experienced when they started their professional careers and how best to prepare and retain today’s new hires who will, too, become one day leaders of the company. As CEO of Align Technologies, Doug Walner (2023) emphasized that attracting and hiring Gen Z talent requires a thorough understanding of the key factors that are important to this demographic. To be successful, business leaders must recognize Gen Z’s unique needs, values, and preferences.