Don’t want to lose your Gen Z and millennial talent? Here’s what you can do has been saved
Cover image by: Sylvia Yoon Chang
The Great Resignation. These three words have increasingly become part of boardroom conversations and media buzz in the last year or so, with employees quitting organizations in large numbers. Among those giving companies their two weeks’ notice were Generation Zs (Gen Zs) and millennials, a significant portion of the global workforce. What prompted this exodus? What do they care about that their employers were not paying attention to? What will drive their loyalty?
The Deloitte Global 2022 Gen Z and Millennial Survey was fielded between November 2021 and January 2022 to find answers to these questions and more. The survey—that covered 14,808 Gen Zs and 8,412 millennials across 46 countries—provides valuable insights into their views about work and the world around them. Survey responses indicate that Gen Zs and millennials are deeply concerned about the state of the world. They are worried about climate change, wealth inequality, geopolitical conflicts, and more, and they are resolved to drive change. But they are also struggling with the challenges of their everyday lives, from financial anxiety, to a lack of work/life balance, to consistently high stress levels. They want businesses and governments to do more to help.
To begin with, Gen Zs and millennials are concerned about managing their finances. Consider this: Twenty-nine percent of Gen Zs and 36% of millennials selected cost of living (e.g., housing, transport, bills, etc.) as their greatest concern. Only around half of Gen Zs (47%) and millennials (55%) feel they can comfortably pay their living expenses each month, and more than a quarter of Gen Zs (26%) and millennials (31%) are not confident they will be able to retire comfortably. Potentially to alleviate these financial concerns, as many as 43% of Gen Zs and 33% of millennials have a second part- or full-time paying job in addition to their primary job.
One might imagine this financial anxiety among Gen Zs and millennials would prompt them to stay at their jobs. But the survey findings tell a different story: While loyalty is up from last year’s survey, four in 10 Gen Zs and nearly a quarter of millennials would still like to leave their jobs within two years, and roughly a third would do so without another job lined up. The top reasons? Pay, feeling the workplace is detrimental to their mental health, and burnout.
Stress and burnout levels among Gen Zs and millennials are high and present a significant retention issue for employers. Forty-six percent of Gen Zs and 45% of millennials feel burned out due to the intensity and demands of their working environments. Similarly, 44% of Gen Zs and 43% of millennials say many people have recently left their organization due to high workload pressure. Employers may not yet be doing enough to address this challenge. The survey shows that, despite organizations focusing more on mental health in the workplace over the past two years, many Gen Zs and millennials don’t feel this is resulting in any meaningful impact on employees.
While compensation and burnout are driving many to leave their jobs, work/life balance, learning and development opportunities, and positive workplace cultures are key factors for Gen Zs and millennials when choosing a job (figure 1). They are also focused on finding more purposeful work. In fact, nearly two in five say they have rejected jobs and/or assignments that don’t align with their values.
And their values are, indeed, close to their heart. Take sustainable choices and environmental action, for instance. Most Gen Zs (89%) and millennials (90%) are making at least some effort to reduce their own impact on the environment. And despite their financial concerns, many are willing to pay more to purchase environmentally sustainable products. They expect a similar commitment to environmental action from their employers and businesses. But only 18% of Gen Zs and 16% of millennials believe their employers are strongly committed to addressing climate change.
The last couple of years have been tumultuous for organizations, especially in terms of employee turnover. But the Great Resignation may provide them with an opportunity to rethink their strategies and drive sustained workplace changes that will better attract and retain talent. Here’s what businesses can consider:
Address wealth inequality: The most direct action many organizations can take to address wealth inequality is to focus on supporting their own people. Competitive salaries are important, as are benefits like paid time off, health care, and retirement savings. But there’s more that organizations can do. They can offer financial education and resources to help employees plan and manage their finances, provide learning and development opportunities so that they can advance professionally, offer flexible work models and well-being resources to help people manage their personal responsibilities, and focus on closing the pay gap, which will include ensuring women and minorities are represented at all levels and that they have equal opportunities to grow.
Support better mental health at work: Leaders should work towards meaningful and sustained change by providing increased access to mental health resources—from supportive leaders, to paid time off as needed, educational materials and resources about how to reduce stress and avoid burnout, to company-sponsored counseling or therapy. Critical to this effort is a consistent and vocal commitment to designing stigma-free working environments that value well-being, where workers feel able to speak up about their needs without fear of judgement. The trust needed for people to open up and seek help rests on the everyday behaviors and accessibility of their managers, which is why business leaders must act on building empathetic leadership skills and helping managers learn how to recognize and help with mental health challenges. Showing people how to set boundaries to protect their work/life balance, and supporting them in doing so, is also a critical way to support better well-being and prevent burnout.
Prioritize climate action and inspire the workforce to take part: Organizations should look for ways to consistently engage and inspire their people to take part in their climate strategies. This includes everyday actions like, banning single-use plastics. It should also include longer-term strategies to achieve net-zero greenhouse gas emissions, which will require a number of efforts such as, educating and empowering people to make sustainable choices, offsetting current carbon emissions, reducing business travel, greening office locations, fleets, and supply chains, and offering sustainable products and services. Gen Zs and millennials care about these issues, and they want to be directly involved. By empowering their people to help fight climate change, businesses will be better positioned to drive change at scale.
Gen Zs and millennials want to work for organizations that empower them to get directly involved to drive change—both within their organizations and in society more broadly. To make this happen, leaders should listen to and incorporate insights from people at all levels of the organization.
Establish hybrid work strategies: Seventy-five percent of Gen Zs and 76% of millennial survey respondents said they would prefer a hybrid or remote working pattern. However, hybrid work strategies work best when they also foster inclusivity where everyone has equal opportunities to form connections, learn, and grow. This will ensure that those who spend less time in the physical office aren’t penalized. Steps in this direction could include organizing more intentional in-person meetings, providing teams with training to work together more effectively in hybrid environments, unconscious-bias trainings for leaders to prevent and overcome proximity bias, tracking promotion rates to ensure that remote workers are promoted at the same rate, and managers scheduling equal one-on-one time to their reports, regardless of where they work.
Empower people at every level: Gen Zs and millennials are increasingly looking for purpose-driven work, where they are empowered to drive change—both within their organizations and in society. They want to work for organizations that are having a positive societal impact, and where they have an opportunity to get directly involved and make a difference through their work. To make this happen, leaders should listen to and incorporate insights from people at all levels of the organization through initiatives like reverse-mentoring. They should also provide opportunities for upskilling and give their people opportunities to explore their potential by taking on projects that may lie outside of their normal day-to-day responsibilities. Empowering people to lead at every level of the organization is a key part of creating inclusive cultures where people feel valued and a sense of belonging.
Cover image by: Sylvia Yoon Chang