As the “Great Resignation” continues to dehydrate an already-dry labor market, small-business owners are challenged to fill talent gaps. According to the Bureau of Labor Statistic’s April 2022 Job Openings and Labor Turnover report released on June 1, the number of job openings was at 11.4 million. (In March 2022, job openings were at 11.5 million, which was the highest level in the history of the series that began in 2000.)
One portion of the population leaving in droves are Baby Boomers. Consisting of those born between 1946 and 1964, this segment made up the backbone of small businesses for decades. According to data from the Pew Research Center, "as of the third quarter of 2021, 50.3% of U.S. adults 55 and older said they were out of the labor force due to retirement. [...] In the third quarter of 2019, before the onset of the pandemic, 48.1% of those adults were retired."
The Baby Boomer exodus leaves a labor shortage that only the newest generation can fill. Known as Gen Z and made up of people born from 1997 onward, the competition is on to hire this youngest generation.
Who is Gen Z and What Do They Want?
The first digitally native generation to enter the workforce, Gen Z employees have always known a connected world and understand technology at a deeper level than other generations. They’ve also grown up under the watchful eye of social media and have used that landscape to mold their personal identities. Like the Millennial generation before them, they are socially conscious and put a high value on organizations that are Diverse, Equitable and Inclusive (DEI).
While social consciousness, culture, and community play a key role in their employment decision-making, Gen Z employees grew up in the shadow of the Great Recession. That means they also value financial security.
Sarah Thibeau is content manager at Corpay, a bill payment platform for small businesses. She is a member of the earliest cohort of Gen Z sometimes referred to as Zillenials. “The number one subject my peers discuss regarding employment is compensation,” she says. “If you want to attract and retain Gen Z employees, be upfront with salaries, value our work appropriately, and offer opportunities for growth.”
In addition to pay, Thibeau notes company culture is important. “I joined Corpay because I wanted to work with an ethical fintech [company],” she says. “Ethics are important to my generation. We often look at things through a cynical lens, and we’ll notice if we’re being pandered to. If you want to attract and retain Gen Z employees, the benefits need to be tangible, not just, ‘We have ping pong.’”
How to Hire Gen Z Employees
“The Gen Z demographic is looking for something different than other generations,” says Kathleen Quinn Votaw, CEO of Talentrust, a recruiting and human capital consulting firm and author of Dare to Care in the Workplace: A Guide to the New Way We Work.
“Over the last few years, we’ve seen culture become a more prominent decision-making factor in the job candidate market,” says Votaw. “Creating a community is extremely important for attracting Gen Z employees.”
Culture matters to Gen Z, and they know how to find out if your organization is who you say you are. Inclusiveness, social impact and the courage to take a stand for what you believe is right, especially given current events, goes a long way to earn Gen Z’s trust and respect.
— Pamela Mattsson, senior vice-president of people and organizational development, Outreach
Provide Fair Compensation
“For most Gen Z employees, this is their first ‘real’ job and the transition into ‘adulting’ is daunting,” says Pamela Mattsson, senior vice-president of people and organizational development at Outreach, a sales execution platform. Her company has hired 63 Gen Z employees and counting since May 2021. “Competitive pay is important,” she says. “Particularly in base salaries.”
Thibeau agrees. “We will notice if we’re being underpaid in a role. Money is a big motivator to make job moves.”
Invest in the Latest Technology
“As the first digital natives, Gen Z employees expect a digital-first approach and more advanced uses of technology,” says Anthony Reynolds, CEO of HireVue, a hiring process platform. Using the latest hiring technology will also give you an edge.
“Our 2022 Global Trends Report found that companies meeting hiring demands more successfully and more quickly in the last year were the ones that have introduced job-matching technologies (57%), moved to a combination of both in-person and virtual interviews (37%), and have implemented technologies such as AI, chatbots, and skills assessments (24%).” (The report featured responses from 1,657 hiring leaders across the globe.)
Nurture an Inclusive Company Culture
One of the biggest factors in recruitment and retention of Gen Z workers is their alignment with a company’s values.
“Something we’re seeing in industries such as specialty retail is success in attracting Gen Z workers who are personally aligned with the products they’re selling,” says Jake Levin, co-founder and CEO of the incentive management platform SparkPlug. “Brand values are particularly important to Gen Z.”
Be transparent about company values, suggests Mattsson. “Culture matters to Gen Z, and they know how to find out if your organization is who you say you are. Inclusiveness, social impact and the courage to take a stand for what you believe is right, especially given current events, goes a long way to earn Gen Z’s trust and respect.”
Gia Ganesh is vice-president of people and culture at Florence Healthcare, a clinical trial software company. “Our Gen Z employees enjoy our volunteer-led DEI team,” she says. “We also hold activities like unconscious bias training and celebrate observances like Spanish Heritage month.”
For Gen Z employees, work-life balance and flexibility are critical components of the ideal work environment.
“Having grown up surrounded by the gig economy and seeing people make a living through avenues like content creation, Gen Z employees tend to value independence and flexibility,” says Levin. “With the pandemic-accelerated remote and hybrid workspaces, this is a generation that is unwilling to sacrifice workplace flexibility for a position.”
Mattsson’s company attracts and retains Gen Z employees by offering a flexible work environment. “We have unlimited time off, demonstrating our trust in our employees,” she says. “We also have ‘refresh days.’ Job candidates tell us they see this time off as a tangible example of our commitment to work-life balance.”
Matt Erhard, managing partner at the executive search and recruiting firm Summit Search Group, has found that Gen Z employees are drawn to options like 4-day workweeks, flexible shift start and end times, and hybrid/partial-remote schedules.
“Gen Z’s willingness to job hop and turn down positions that don’t meet their standards has led to a perception that they don’t want to work, but I’ve found this is not true,” he says. “They will gladly put in 40 or more hours a week, work evenings and weekends, and otherwise commit themselves fully to their jobs, as long as their employer lets them maintain a healthy work-life balance while they’re doing it.”
Provide Feedback and Guidance
Given their younger age, Gen Z employees tend to require a good deal of input and support.
“For many, this is their first professional experience, and they don’t know what they don’t know,” says Mattsson. “Articulating how they can be successful is crucial. Giving just-in-time feedback in a way that shows you believe they can improve is also key. There is an art to being supportive without them feeling micromanaged.”
Create Opportunities for Growth
“Continuing the trend started by Millennials, Gen Z workers see company loyalty as a two-way street,” says Erhard. “Mentorship and professional development opportunities show that you want to help them grow their careers, which will make them much more likely to stick around long-term.”
Many Gen Z employees want to make an impact, adds Ganesh. “We show potential hires the growth opportunities offered at Florence Healthcare and how they can evolve in their personal and professional lives with the experiences we offer. These include lunch and learns, career growth conversations, mentorships with executives, and a yearly professional development stipend.”
Image Credit: American Express