Born between 1994 and 2000, Generation Z is poised to enter the workforce in the coming years. While many companies are still trying to make sense of Generation Y, a recent study by the research and consulting firm Millennial Branding and Randstad revealed some key differences between Gen Y and Z employees that will impact how businesses recruit and manage talent in the coming years.
Jim Link, Chief Human Resource Officer of Randstad North America, says understanding this new generation of workers is particularly important for small businesses, as they will need to adapt management and recruiting techniques to meet the workplace expectations, needs and goals of Generation Z workers.
“As much as we can learn about these folks and their tendencies early, the better off we’re going to be as employers to accommodate their particular taste and style and help make them more successful,” says Link.
Some of the study’s key findings about Generation Z include:
1. Gen Z is more entrepreneurial.
If you thought Generation Y was entrepreneurial, wait until you meet Gen Z. Seventeen percent of Gen Z versus 11 percent of Gen Y said they wanted to start a business and hire others. Dan Schawbel, author of Promote Yourself: The New Rules for Career Success and founder of Millennial Branding, says it isn’t surprising that each successive generation will be more entrepreneurial than its predecessor simply because they have access to a greater wealth of information than those before them. Between blogs, vast social networks and a sea of content to solve nearly every challenge a start-up operation will incur, not to mention access to programs that support entrepreneurship (such as the Thiel Fellowship which grants money to teens who decide to skip college and start their own business).
It’s no wonder this upcoming generation is seeking more entrepreneurial ventures. Schawbel says this entrepreneurial passion can be a great asset to companies. “Corporations need that because they need to stay innovative and competitive in the marketplace,” he says. The challenge for managers will be to provide opportunities for this next generation of workers to flex their entrepreneurial muscle within their companies.
2. Gen Z is less motivated by money than Gen Y.
Only 28 percent of Gen Z-ers surveyed said money would motivate them to work harder and stay with their employer, versus 42 percent of Gen Y. That means employers will need to emphasize other factors, such as training and development opportunities, over a paycheck in order to attract and retain this new cohort of workers. Thirty-four percent of Gen Z are most motivated by opportunities for advancement (compared with 30 percent of Gen Y) while 23 percent are motivated by meaningful work (compared with 15 percent of Gen-Y-ers).
Link says business owners and managers should seek to provide opportunities for personal mentorship, allowing Gen Z to receive regular feedback.
“These folks are going to want to come into your organization and learn everything that they can possibly learn,” says Link. “If I were an entrepreneur, I’d be out there trying to hire these people tomorrow to teach them about my company and the organization in which I work because I think they’re going to make great employees.”
3. Gen Z members are more loyal.
While Gen Y reported they expect to work for five companies in their lifetime, Gen Z reported they expect to work for four or fewer, signalling that this generation may have more company loyalty than their job-hopping predecessors. This is good news, especially for small companies, which have gone through the ups and downs of training and re-training Gen Y workers.
But Link warns companies that don’t exhibit the type of entrepreneurial culture and opportunities for mentorship and growth that Gen Z is seeking can risk losing these workers. Stressing the benefits of loyalty by providing rewards to those who stay in the company longer and providing opportunities for Gen Z to be heard and directly contribute to the work of the company and to take on responsibilities that stretch their skills and knowledge will increase this generation’s company loyalty.
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