Understanding and Managing Gen Z in the Workplace

Gen Z is coming of age and entering the workforce. According to a World Economic Forum report, by 2025, Gen Z-ers will make up almost 30 percent of the global workforce. In this article, we provide insights into the characteristics and trends of Generation Z. From their digital native mindset to their desire for meaningful work that aligns with their values, we consider how these tendencies will affect their expectations and performance at work.

Generation Z, also known as Gen Z, will make up a quarter of the population of the Asia Pacific region by 2025 (according to a study by McKinsey & Co). In Australia, they account for one-fifth of the population.

As this group enters the workforce and marketplace, some employers and managers are perplexed about how to handle them. One study found that employers were generally unsatisfied with the recent college graduates (Gen Z-ers) they hired. Six in 10 companies had fired them within months.

As with every generation, companies and employees will have to try to understand each other. They want to make adjustments so that a healthy, effective work relationship can be achieved. To that end, let’s take a look at who they are, and some general characteristics that define them. Let’s look at what makes them tick.

Who is Gen Z?

Gen Z (Generation Z) is the cohort that follows Millennials (or Gen Y) and precedes Generation Alpha. These are people born roughly between the mid-1990s and early 2010s. They are often cited as 1997–2012, but these dates can vary slightly depending on the source. So as of 2024, you’re looking at a group that is between 12 to 27 years of age, meaning that a significant portion of them are already in the workforce or about to enter it.

They were raised during a period of rapid technological advances, economic instability, and significant societal change. This has shaped their unique worldview, which employers must understand if they are to engage Gen Z effectively.

Characteristics and trends of Gen Z

Digitally fluent, tech-savvy, always online

One of their key characteristics is that they are “digital natives”. They are the first generation to grow up with the internet as part of everyday life. They were children when the iPhone made its debut in 2007. So smartphones, social media, and on-demand entertainment are an integral part of their lives. They are the first generation to be completely immersed in digital technology from a young age, making them highly tech-savvy. According to a McKinsey report, Gen Z-ers in Asia spend six or more hours per day on their phones.

Platforms like TikTok, Instagram, YouTube, and Snapchat are central to Gen Z’s communication and entertainment. Whether shopping, socialising, or working, they are extremely comfortable online. They tend to prefer visual platforms over text-heavy media, and short, fast-paced content is often more appealing to them.

Gen Z expects diversity and inclusion

They has been described as valuing diversity and inclusion. They are more likely to have grown up in diverse family structures, such as single-parent households, same-sex-parent households, and so on. Immigrant families became more common when Gen Z was growing up. And in the U.S., Gen Z-ers witnessed the country’s first Black president and the legalisation of gay marriage.

As such, they is more accepting of different identities, lifestyles, and cultural backgrounds. In fact, as many as 16 percent of Gen Z-ers identify as part of the LGBTQ community themselves, more than any previous generation (https://www.britannica.com/topic/Generation-Z).

Gen Z with mental health challenges

Unfortunately, mental health is an area of major concern when it comes to them. In the U.S., Gen Z-ers report the least positive outlook and the highest prevalence of mental illness of any generation, so much so that the U.S. surgeon general issued a public health advisory in 2021 to address the “youth mental health crisis”. In Australia, the situation isn’t better. According to research by Statista, young people in Australia are more likely to experience mental health disorders than older Australians. In 2022, close to six in 10 Australians aged 15-19 reported seeking mental health support.

Gen Z-ers suffer from anxiety, depression, and burnout. They have been described as the “loneliest generation” and also the “anxious generation”. Many have attributed the isolation and mental health issues to the extensive amount of time spent by Gen Z on social media, with one piece of research showing that a quarter of students who have been bullied were bullied through social media, text messages, or email. 

However, it bears remembering that Gen Z-ers are growing up in turbulent times, with global unrest and wars, financial crises, COVID-19, and climate change.

Emphasises environmental and social responsibility

Gen Z is pragmatic but idealistic. They are concerned about environmental issues such as climate change and sustainability. In fact, Australian Gen Z-ers are well aware that it is important to transition away from fossil fuels, stop deforestation and loss of biodiversity, and cut down on waste. Interestingly, in a research that looked at consumers of different generations across six Asia Pacific countries, only Australian Gen Z-ers were more likely than their elders to say that they are willing to pay more for environmentally responsible products.

This generation is also vocal about social justice causes, including racial and gender equality, and LGBTQ rights. Seeking purpose and accountability, Gen Z-ers often expect brands and companies to take a stand on these issues as well.

Having inherited problems such as global warming and failing social safety nets from previous generations, Gen Z-ers are “dismayed” about such issues and are aware of the work that has to be done to address them. (No wonder their mental health is taking a hit!) 

Managing Gen Z at work

With some understanding of the traits of Gen Z, let’s now look at a few work trends and expectations that research has revealed about this generation.

Get on board with technology and digital tools

Because they are such an online and tech-savvy group, employers should provide Gen Z employees with up-to-date digital tools and technologies that enhance productivity and collaboration. Don’t be afraid to try out new technologies or allow your Gen Z team members to introduce tech innovations. Studies by McCrindle Research on Australian Gen Z-ers found that technology is especially appealing to Gen Z in the workplace: 80 percent of them want to work with cutting-edge technology in their career. In another survey of Gen Z-ers from Australia, it was found that broken IT processes that caused work inefficiencies were reason enough for 31 percent of them to quit and look for a new job.

Improve work-life balance and flexibility

To be fair, flexible work arrangements have been one of the top priorities for workers across generations since the Covid-19 pandemic. Many realised that there were better ways of working and being rigidly bound to an office for eight or more hours a day was not how they wanted to live their lives, leading to the Great Resignation.

Similarly, work-life balance and flexibility are key priorities for their employees. In various surveys, Gen Z-ers have placed work flexibility ahead of salary. Plus, with their technological capabilities, this group is able to work and collaborate across space, cultures, and time zones. So offer flexible work arrangements, remote work options, hybrid models, and the like. Give them the freedom to balance work and personal life, and focus on outcomes and productivity rather than rigid schedules. The McCrindle study found that 61 percent of the Australian Gen Z-ers who were surveyed regarded flexible working hours as extremely or very important to them in their place of employment.

Create meaningful, purpose-driven work

While Gen Z-ers are concerned about their finances (more on this below), they are apt to seek out meaningful, purpose-driven work that aligns with their values and principles. Such values and personal beliefs may include those trends mentioned previously. This includes sustainability and environmental conservation, social justice and inclusivity, and support for mental well-being. In a recent survey by Deloitte of nearly 23,000 Gen Z and Millennials across the globe, it was found that more than 80 percent said having a sense of purpose is very or somewhat important to their overall job satisfaction. Around 40 percent have turned down an employer based on their personal ethics or beliefs. 

What this means for companies and employers is that you must define and communicate a strong, authentic mission that resonates with their desire to make a positive impact. Companies that ignore societal or environmental issues may struggle to attract and retain this generation.

Offer competitive pay and benefits

When they entered the workforce, it was against the backdrop of a global pandemic, financial recession, rising inflation, and climate change. They watched their parents and communities take financial hits and lament over shrinking pensions. In Australia and New Zealand, they faced escalating education costs and debts from student loans. In the U.S., they are pessimistic about their chances of ever buying a home or even retiring. Because of these financial insecurities, Gen Z-ers are more likely to hold multiple jobs, part-time jobs, or side hustles, such as being online influencers. Moreover, they are more inclined to freelance or start their own businesses rather than sticking to traditional 9-5 jobs.

Hence, Gen Z-ers are financially minded and pragmatic about money. This affects how they negotiate for salaries and how long they’ll stay in a job. Contrary to popular belief, they do not seem to be job hoppers. However, they do expect to be given learning opportunities, growth, and a clear career path. So offer competitive compensation and benefits, while investing in career growth and training. You can also consider creative benefits such as student loan assistance, meal allowances, wellness programmes, or retirement plans.

Grooming the leaders of tomorrow

The tendency of older generations to define and understand the younger has occurred as long as human societies have existed. Often, the younger generations seem more hedonistic, entitled, incapable, or ___(fill in with descriptor of your choice)___. However, we hope that this article has helped you understand them a little better. With understanding and practical adjustments, you can empower your Gen Z team members and draw out their considerable potential.

As psychologists and coaches, we can help train your high-potential Gen Z recruits to be future leaders. We can arm them with the relational, communication, and self-management skills that will aid in their career growth while serving your organisation more effectively. 

Get in touch with us.