As Gen Z employees surpass baby boomers in workforce participation, new mindsets, expectations, and values are guiding their employment decisions. Here’s how HR can leverage these changes to enable organizational success.
By Maggie Mancini
Gen Z is making a splash in the workforce, challenging HR leaders to adjust expectations and adapt to shifting workplace dynamics as younger people continue to exceed older employees in workforce participation. This cohort of workers, many of whom entered the workforce in the shadow of the pandemic, have had to navigate obstacles like remote onboarding, lack of experience with in-person communication, and uncertainty due to economic volatility and technological advancements that are reshaping the nature of work, says Megan Smith, head of HR at SAP North America.
“Gen Z is unique in that they are the first generation to grow up surrounded by technology as a standard way of life with no experience any other way,” Smith says. “This includes the proliferation of smartphones and social media use before the impacts of these technologies on mental health were fully understood. They may also have been recipients of helicopter parenting, with potentially less risk and independence in their upbringing.”
Research from MetLife finds less than one in three Gen Z employees feel holistically healthy, and Gen Z employees are more stressed, depressed, and burnt out than the average employee. What’s driving this decline in morale? Isolation, says Matt Newman, SVP of HR at Genesys.
“The debate between remote work and in-office work is ongoing, with each offering its own pros and cons for individuals and companies alike,” he says. “One significant challenge with fully remote work, especially for those just starting their careers, is the lack of opportunities to engage with the company and their new colleagues in a meaningful way.”
As of the second quarter of 2024, Gen Z workers made up almost a fifth (18%) of the labor force, slightly more than boomers (15%).
Employees who began their careers in traditional office settings often benefited from observing a company’s operating rhythms, Newman says. Gen Z employees who entered the workforce via virtual environments may have missed this.
“Without deliberate efforts by companies to mentor, guide, and equip younger employees with these essential skills, the trends highlighted in MetLife’s research are not surprising,” Newman says. “Addressing this gap with targeted support and education can be key to improving morale and overall well-being for Gen Z employees.”
Shifting Labor Force
The share of Gen Z employees in the workforce surpassed that of baby boomers for the first time in the third quarter of 2023, according to the U.S. Department of Labor. As of the second quarter of 2024, Gen Z workers made up almost a fifth (18%) of the labor force, slightly more than boomers (15%). HR leaders can play a crucial role in bridging the gap between baby boomer managers and Gen Z employees by improving their understanding of how younger workers learn and engage differently than older employees, Newman says.
“Gen Z often thrives in environments that prioritize shorter, quicker learning cycles similar to the principles of agile development,” he says. “They tend to prefer ‘learn by doing’ approaches: tackle a task, reflect on the experience, and then iterate or expand upon it.”
Traditional learning models—often favored by baby boomers—rely on observing entire processes over longer periods before engaging directly, he explains. This difference can create misunderstandings if managers expect Gen Z employees to adapt to older approaches.
“To improve job satisfaction and retention, HR leaders can implement training programs that not only align with Gen Z’s learning preferences but also equip baby boomer managers with tools to effectively support these styles,” Newman says. This might mean microlearning modules, real-time feedback loops, and opportunities for experimental learning, he says.
Flexibility, empathy, and a commitment to fostering collaboration have become crucial to cultural and business success as Gen Z employees make up a larger portion of the workforce, Smith says. HR leaders are uniquely positioned to bridge these generational gaps by creating space for open dialogue and designing programs that promote engagement.
“As Gen Z employees begin to surpass baby boomers in workforce participation, it is crucial for employers to identify skills gaps in their organization and foster open communication with early talent to ensure they are prepared for their next role or opportunity,” Smith says. “Gen Z are a digitally native generation who expect evolving technology to impact their work. Encouraging early talent to dig into new technologies like AI and machine learning to improve their daily work may free them up for more strategic roles within an organization.”
When Gen Z employees reengage in hybrid environments, they benefit from hands-on training, mentorship, and community at work, Smith says. Employers can encourage collaboration across generations to encourage older employees to pass down their knowledge base to those entering the workforce.
While most employees across generations feel valued by their managers, just a quarter of Gen Z employees agree.
Improving the Manager-Employee Relationship
Research from Checkr finds that while most employees across generations feel valued by their managers, just a quarter of Gen Z employees agree. When it comes to improving the manager-employee relationship and keeping Gen Z employees connected to their organization’s mission, employee recognition is paramount, Newman says.
There are several ways HR leaders can leverage recognition to improve the employee-manager relationship.
- Tie employee achievements to the organization’s mission. “These conversations should also include actionable feedback to support their growth and development,” Smith says. “By clearly communicating the ‘why’ behind day-to-day tasks, managers can create an environment where Gen Z employees feel valued, motivated, and invested in the company’s success.”
- Create a toolkit of recognition strategies. By guiding managers on how to apply employee recognition strategies consistently and equitably across the organization, HR leaders can embed recognition as an integral part of organizational culture, rather than just a one-off gesture, Newman says.
- Invest in personalized recognition. “Recognition is highly personal, so managers should be encouraged to take the time to understand how individual team members prefer to be acknowledged,” he says. “For some, a public shoutout might be motivating, while others may value private praise or development opportunities.”
- Understand what Gen Z values. “For Gen Z specifically, research shows they value real-time feedback and regular recognition,” Newman says. Managers should provide authentic, earned acknowledgment on a monthly or even more frequent basis, using a mix of approaches, he says. This could include personalized notes, team-wide kudos, or opportunities for professional growth.
- Learn about employees’ personal and professional goals. By taking time to understand an employee’s career aspirations, managers can make connections within the organization to different people whose roles may inspire early talent, Smith says. “They can recommend training and stretch assignments which will help Gen Z feel more integrated into their teams and organization,” she says. “Managers can and should, also encourage early talent to explore employee resource groups which foster a sense of inclusion.”
Employee Values Are Changing
Gen Z employees value personal connections and work that aligns with a higher purpose, Smith says. HR should focus on the “why” of their work and help employees understand the way their work contributes to the company’s overall success.
Smith explains HR leaders can do this by implementing the following:
- transparency in communications;
- focused goals they can participate in and contribute to;
- real-time feedback loops; and
- building a growth mindset focused on learning from mistakes and having opportunities for growth.
“Gen Z also places a strong emphasis on work-life balance and well-being, and leaders have a responsibility to support both,” Smith says. “It’s a bit of a double-edged sword though because while flexibility is important, this generation didn’t get to experience the natural boundaries of a 9-to-5 culture, so flexibility can be what leads to burnout when boundaries are not in place.”
Elevating performance goes together with ensuring employees they need to thrive, Smith says. This could mean providing flexible work arrangements, access to mental health resources, and investing in ERGs. Embedding wellness into an organization’s culture builds trust and demonstrates commitment to success.
“Building on the idea that learning and development for Gen Z aligns with shorter, more iterative cycles, and if Checkr has found that recognition alone isn’t sufficient, I’d suggest that what many Gen Z employees truly seek is actionable feedback on their performance,” Newman says. “They want to know: Are they doing it right?”
Newman explains that recognition takes on a broader meaning in this context, encompassing both positive reinforcement and constructive feedback. Organizations can address the root causes of discontent among Gen Z employees by providing real-time insights, celebrating successes, and offering guidance on small adjustments to help them improve, he says.
