The workforce is shifting with Generation Z, often called “the restless generation”.
Attrition rates are higher than ever, driven by increased job mobility combined with lack of job satisfaction, rigid workplace policies, disappointing pay, and unclear career progression.
1. Lack of Job Satisfaction
According to a 2022 Gallup Poll, “54% of Gen Z employees … are ambivalent or not engaged at work”.
Generation Z is struggling to stay engaged partly because of the changed nature of work. Many members of Gen Z entered the workplace during COVID-19, and were forced to work remotely during their initial formative years of employment. As a result, they have been less likely to forge the social relationships that make work enjoyable, and relationships between colleagues have become more depersonalized.
Lack of engagement among Gen Z has also resulted from a diminished sense of trust, which includes reduced confidence in employers, and more broadly a lessened faith in established institutions. Many Gen Z employees have already experienced a round of layoffs, which has led to a sense of disenchantment. Combine this with stagnant real wages, uncertain job prospects, and unaffordable house prices, and Gen Z has understandably lost its faith in the status quo.
Although the specific reasons for the growing sense of dissatisfaction often go unacknowledged, unarticulated, or misunderstood, the desire to rail against the status quo has gained a voice in movements such as Occupy Wall Street, Black Lives Matter, March for Our Lives, and Fridays for Future.
A general yet pervasive passion for change translates directly into the workplace, where young employees require more meaningful work to stay engaged. Many employers have thus sought to engage with projects or company-wide initiatives that resonate with these interests in order to boost employee engagement and reduce turnover.
2. Inflexible Work Policies
Work policies revolving around work-life balance and flexibility appeal to younger generations. Generation Z and Millennials value their well-being, and are choosing jobs based on whether the roles contribute to a positive work-life balance. According to a 2024 Deloitte Survey, younger generations consider positive work-life balance as “their top consideration when choosing an employer”.
Generation Z often asks not “how can I get promoted?” but rather “how can I work the least number of hours for the most amount of money?” In the past, employers placed more emphasis on the number of hours worked, even if there were no pressing deadlines. Now, there’s an increasing push from Gen Z to be remunerated for simply getting the job done.
While employers are increasingly recognizing the demand for greater work-life balance, they are still looking to hire employees who will roll up their sleeves, even when this comes at the expense of work-life balance.
Not only are employees demanding flexibility in regard to when they work, but also where they work. Younger generations accustomed to the working conditions that prevailed during COVID-19 have a preference for remote work, which offers benefits such as greater autonomy, flexibility, and work-life balance.
However, for many firms remote work poses challenges when it comes to fostering collaboration, building workplace culture, and ensuring consistent productivity.
Many firms are opting for hybrid models as a compromise, but still need to ensure that remote employees remain engaged and connected to their teams.
3. Stagnant Pay
Gen Z has more anxiety regarding pay compared to previous generations. According to research by Empower, Gen Z believe they need “an average annual salary of $587,797” to be successful, which is more than five times that of Baby Boomers. While this figure is unrealistic, it highlights Gen Z’s heightened financial concerns in today’s uncertain economic climate.
Gen Z has grown up in a time of rising wealth inequality, income inequality, costs of living, competition for jobs, and student debt. When combined with increased social media attention given to all of these problems, this has led to the perception that the world is unfair.
In order to save money, I now have more friends living with their parents than on their own. While each generation faces its own challenges, the lingering economic uncertainty is definitely hindering Generation Z’s ability to become independent, start a family, and commit to stable full-time employment.
Many Gen Z employees enter the workforce with salary expectations shaped by social media portrayals of wealth and success. However, as they encounter real-world job markets, adjusting expectations to align with industry standards can be a challenge. They often expect a six-figure salary right out of college, even though many people are living paycheck to paycheck.
With traditional markers of success, like homeownership increasingly out of reach, Gen Z needs more money than previous generations just to feel financially comfortable. The disconnect between market realities and elevated expectations can cause Gen Z to jump ship for a higher paycheck, instead of staying put and growing their professional experience at one company.
4. Lack of Professional Development
A key motivator for younger generations is opportunities for continuous learning, and so investing in employees is an obvious way to boost retention.
Employers can provide professional development through formal onboarding, mentorship, training, and performance review programs, as well as via informal job shadowing and daily feedback.
Professional development can also be tailored to employees’ interests, like the Goldman Sachs Returnship Program, which helps women re-enter the workforce after career breaks by providing mentorship and professional development.
Gen Z values transparency regarding career advancement. Employers should clearly communicate the criteria required for promotion, and performance reviews should provide an indication of how employees are performing against those criteria, providing an indication of when they are likely to get promoted.
Employees who stick it out and keep their heads down in the absence of promotion can earn respect from management. However, companies that don’t have clear career advancement opportunities risk losing Gen Z employees to companies that offer better career growth potential.
5. Increased Job Fluidity
Technology and the rise of side hustles also contribute to turnover in the workplace.
In the past, people sought success through traditional fields like law, medicine, engineering, or journalism.
Now, social media showcases success and provides unconventional career options in entrepreneurship, content marketing, and freelancing.
Increased career optionality leads young people to feel less satisfied with their careers, and to constantly question what else is out there.
Many employees, especially younger ones, balance side gigs alongside their full-time job. As an employee’s side-hustle becomes more successful, this creates a greater ability and willingness to leave their primary job if it doesn’t meet their needs.
Traditional job markets are also much more fluid than they used to be. A professor once told me that “the average Gen Z individual will have 16 jobs across 7 career paths”. This view is widely held by Gen Z, and so they are much more likely to jump ship, feeling less stigma for job switching and being more confident that new opportunities are out there.
Rather than fight the zeitgeist, forward-thinking employers can embrace it by offering internal gig opportunities, project-based work, or flexible career paths that allow employees to diversify their skills without leaving the organization.
The bottom line
Despite changing expectations among younger generations, industries like management consulting and investment banking remain comfortable with high turnover rates.
Instead of prioritizing long-term retention, they set unrealistically high expectations and rely on a constant influx of new grads to fill the ranks. Junior employees often leave these firms within 4 years due to a combination of low job satisfaction, inflexible work policies, disappointment regarding pay, and lack of clear career progression.
Ultimately, retention is not just about reducing turnover, it’s about creating a workplace that inspires loyalty and engagement. By prioritizing trust, flexibility, and transparency, firms can position themselves as employers of choice for the restless generation.
What strategies has your organization implemented to retain Gen Z employees? Share your thoughts in the comments.
Elle Cheney holds a BA in Communications and Research with a Minor in Business from Brigham Young University. With professional experience in management consulting, marketing, and communications, Elle is curious about creative problem solving, thrives in environments that are highly collaborative, and values opportunities for mentorship. She aspires to create memorable experiences for customers as part of her long-term career.
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