What Does Gen Z Want in the Workplace?

Quick look: Gen Z is reshaping the modern workforce. These value-driven digital natives want more flexibility, more work/life balance, and more non-traditional employee benefits—and employers should prepare accordingly. As Gen Z becomes a larger portion of the labor force, smart organizations must strategize on who these workers are and how to deliver what they want in a job.

By 2025, Gen Z is expected to comprise 27% of the global workforce, and they are projected to take over Boomers in the full-time workforce in 2024. This generation, born between 1996 and 2012, makes up more than a quarter of the U.S. population and is slated to be the most diverse group in the nation’s history.

Tapping into this growing wave of talent is critical, especially for small businesses that compete against larger, more well-known companies. So, what is Gen Z looking for in an employer? Here’s a look at who this generation is, what they’re looking for in a career, and how small- and medium-sized businesses (SMBs) can become more strategic in hiring and retaining them.

Who is Gen Z?

Gen Z is commonly categorized as people born between the late 1990s and 2012. They are pragmatic, technology savvy, and generally skeptical of the world around them, having grown up with social media in a time of rampant misinformation. The oldest members of Gen Z have been employed for a handful of years, and younger Gen Zers are ripe for recruiting through university career centers, job fairs, or on their preferred social platforms of Instagram, Reddit, and TikTok.

Additionally, Gen Z tends to:

• Prefer in-person interactions
• Have an entrepreneurial spirit
• Be competitive and value recognition for their work

These qualities have a massive impact on Gen Z in the workplace. Their intrinsic skepticism of the world around them means authenticity matters, and employers should tailor their strategies to appeal to the wants and needs of this new era of workers.

Gen Z at work

It’s no secret that a strong benefits package is key to attracting employees. But what matters to older generations isn’t what will get younger workers in the door. Today’s Gen Z candidates are evaluating more than just health insurance, compensation, and retirement plans. They assess employers holistically, including company culture and whether perks and benefits align with their lifestyles.

A recent study found that approximately 97% of Gen Z states that work is part of their identity, and 83% are self-proclaimed job hoppers pursuing diversified skill sets, fresh challenges, and business environments that align with their values. It also revealed the top three things motivating Gen Z to work are:

• Personal development (35%)
• Ambition and desire to prove themselves (28%)
• Family responsibilities (28%)

To attract this group, employers should ask themselves, “What do our younger employees want from the workplace?” Here are a few helpful tips to answer that question, along with modern perks and benefits that SMBs need to offer to entice Gen Z candidates.

Work-life balance

Flexible work options are now the rule, not the exception. According to Indeed, 87% of Gen Z believe the benefits of working from home outweigh being on-site, and 94% wouldn’t take a job that required them to work in-office full-time.

Gen Z, fluent and comfortable working with digital tools, prefer to work from home or wherever best fits into their lives. Many of these employees crave fluidity and an individual management style where they can complete their work their own way, on their own time.

Despite favoring flexible schedules, more Gen Z employees (51%) feel more pressure to be available after hours than millennials (45%), Gen X (39%), and baby boomers (27%). This further reiterates the need for business leaders to prioritize their staff’s work-life balance.

✔ Employer tip: Offer hybrid or remote work options, if possible. Communicate the importance of unplugging and encourage leadership to demonstrate that they take time away from work to relax and recharge.

Technology

As digital natives, Gen Z has never known a world without the internet and is more technology-driven than any other age group. They have been conditioned to expect immediacy and want to access information quickly and easily from anywhere, at any time.

A Dell study shows that 80% of Gen Z expect their company to provide laptops, tablets, and phones, and another 91% say technology influences their decision to choose between similar employers. Offering the right tools and software to your Gen Z staff can be the difference between them choosing your company or a competitor. Artificial intelligence (AI) is also a focal point for this demographic, with 38% planning to participate in GenAI training within the next 12 months.

This generation also expects convenient medical care. Gen Z visits urgent care clinics more than any other generation, with 56% having visited more than three times in the past year due to convenience and ease of access.  Additionally, 32% of Gen Z lacks a primary care provider, which is problematic considering people with primary care are more likely to fill prescriptions, get an annual preventative exam, and receive cancer screenings.

✔ Employer tip: Invest in HR technology platforms and mobile applications where Gen Z workers can conveniently manage their HR tasks like payroll, employee benefits, and paid time off (PTO). Consider crafting an AI policy and offering telehealth to foster employee health.

Diversity, equity, and inclusion

Diversity, equity, and inclusion (DEI) is an increasingly relevant topic in today’s business environment. It is of special importance to members of Gen Z as they seek out employers who align with their values; 77% say DEI is a key factor in their decision about where to work.

This age group is the most racially, ethnically, and culturally diverse generation in U.S. history. And with so many of these workers reporting having witnessed or personally experienced discrimination or bias based on race, ethnicity, sexual orientation, or gender identity in a workplace setting, it’s no surprise that this generation is holding their employers to higher standards.

✔ Employer tip: Focus on building an inclusive leadership team, consider establishing a DEI committee, provide training on the benefits of a diverse workforce and overcoming bias, and analyze workplace data against DEI standards.

Career growth and development opportunities

More than three-quarters of Gen Z employees want more opportunities to learn or practice new skills, and 61% want to move up in their careers or increase their responsibilities.

Investing in your younger talent can help you secure the best Gen Z workers in the long term. This begins with laying out a well-defined career plan, accompanied by specific programs including mentorship opportunities, cross-training, reskilling/upskilling, and online education courses.

✔ Employer tip: Consider career pathing, developing a mentorship program, adopting a robust learning and development platform, and offering education stipends.

Corporate social responsibility

Gen Z has more social awareness than any other generation and cares deeply about authenticity, activism, and values. These employees are interested in working for ethical companies that believe solving today’s societal issues is just as important as making a profit.

Deloitte’s 2024 Gen Z and Millennial Survey reveals that half of Gen Zers have rejected an assignment or project due to their personal ethics or beliefs, and 75% feel an organization’s community engagement and societal impact is an important factor when evaluating potential employers.

✔ Employer tip: Consider planning a corporate social responsibility (CSR) strategy that includes volunteering, philanthropy, environmental conservation, and diverse labor practices.

Mental health support

Nearly one-third of Gen Z workers say they always or often experience some level of burnout at work, and just 51% rate their mental health as good or extremely good.

As such, this generation is more likely to seek mental health assistance or wellness support from their employers in the form of mental health coverage, employee assistance programs (EAPs), and a stigma-free work environment.

✔ Employer tip: Offer comprehensive health insurance, provide access to an EAP and in-office wellness spaces, and acknowledge mental health in the workplace.

Financial wellness initiatives

Gen Z prioritizes paying off debt and saving for the future. Many Gen Zers are fresh out of college and carry student loan debt, making a student loan repayment program a great way to attract and retain this population. Additionally, 65% of recently surveyed undergraduate students said they wouldn’t accept a job that didn’t include an employer-administered retirement plan.

There’s no question that embarking into adulthood right now is financially challenging. Housing affordability is at its lowest level since 1984, and 33% of Gen Z is worried that high inflation will make it harder for them to buy a home. Additionally, roughly half of this generation has side jobs and lives paycheck-to-paycheck. Needless to say, fair pay is a priority to Gen Zers, with 70% stating a competitive salary plays a significant role in deciding whether to stay with their current company.

✔ Employer tip: Employers can engage in salary benchmarking to confirm their staff’s wages align with industry standards. They should also consider offering retirement savings plans, student loan repayment programs, flexible savings accounts (FSAs) and health savings accounts (HSAs), and access to financial advisors and training.

A helping hand to meet Gen Z’s needs

Now that you understand what motivates Gen Z in the workplace, it’s important to consider how your organization can align with their needs. This younger cohort’s expectations reach every corner of a business, from recruiting strategies to community outreach initiatives.

SMBs have much to gain by hiring Gen Z employees—but they may lack the time and resources to tailor their organization to this younger generation. That’s when partnering with a professional employer organization (PEO) may be helpful. For instance, ExtensisHR specializes in helping small businesses:

• Offer Fortune 500-level employee benefits at competitive rates
• Develop a range of human resource (HR) policies (remote work, mentorship programs, volunteer time off, etc.)
• Access mobile-first HR technology platforms
• Recruit Gen Z staff (at no additional cost with our PEO offering) and encourage fair pay through salary benchmarking services
• Understand their DEI status with our DEI Dashboard, which provides real-time DEI data on pay equity, salary trends, turnover, promotions, and more

As with any generation in the workplace, understanding and supporting your Gen Z staff will take some effort. But by updating and adjusting HR practices and strategies to meet the needs and desires of what Gen Z is looking for, you can position your company as an employer of choice for this skilled, driven demographic.

Looking to better appeal to Gen Z talent? Our experts are here to help. Contact ExtensisHR today.