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Compensation Sense: Generation Z Employees – A Snapshot for Effective Compensation and Motivation

November 10, 2017
Generation Z Employees Total Reward Solutions

Ready or not, Generation Z employees are entering the workforce; and they bring unique skills and characteristics that will impact productivity, compensation, and total rewards. Let’s look at what sets Generation Z employees apart from other workers, and how these differences can help you attract, motivate, and retain these workplace newbies:


Just Who Are These Generation Z People, Anyway?

Also referred to as the “iGeneration,” Generation Z individuals were born between 1995 and 2010. Obviously, the youngest of the Gen Z group are years away from entering the workforce; however, the first college graduates of this generation are already beginning to enter corporate America. At 72.8 million strong, Generation Z individuals will be one of the largest segments of the U.S. population; and therefore, one of the largest segments of employees in the American workplace!


What Are Their Defining Characteristics?

Though Gen Z individuals are reluctant to classify themselves, the broad spectrum of Generation Z shows it to be the most diverse in history. As such, Gen Z members are often bilingual/multilingual, and they embrace multiculturalism. This perspective informs their world view, and influences their social attitudes in favor of diversity and equal rights.

As the first true “digital natives,” members of Generation Z have grown up with smart phones and the ability to get instant information, 24/7. They have short attention spans and little patience waiting for answers. Indeed, they tend to gobble up information quickly and move on to the next thing. What’s more, being able to quickly FIND the right information is more important to them than knowing the right information. In fact, many Gen Z individuals indicate that technology sophistication would impact their interest in working for one company over another.

Because they have grown up in the digital age, members of Generation Z instinctively use social media. They are well-connected, but prefer quick and visual platforms like Snapchat and Instagram over Facebook. They are inclined to use anonymous social media platforms, and have learned not to share their lives for public record. Despite their social media fluency, they prefer face-to-face communication, even though they may struggle with it.


What Are the Core Values and Preferences of Generation Z Individuals?

Raised by tough-love Gen Xers, members of Generation Z are independent and in survival mode when looking at their future careers. Although they want out of their parents’ houses, they are cautious and drawn to safety. They tend to steer away from risky behaviors, and are more sensible in their career choices.

They have a sense of social justice and philanthropy, too, rooted in a maturity that springs from growing up during severe economic recessions. Perhaps also based on the harsh economic realities of their upbringing, they are eager to work, and open to bypassing college to directly enter the workforce. Part of this perspective is due to their major fear of college debt.


What Motivates Generation Z Individuals?

Not surprisingly, then, money and job security are top motivators for this group. They want stability, but not stagnation; they look for opportunities to advance and will remain loyal to a company that can provide them. They want to contribute to the bigger picture and make a difference – but surviving is more important. Gen Zers are thankful to have a job and willing to start at the bottom and work their way up. Beyond this, they are likely to get education directly related to their field of interest. They want work/life balance, and are inclined to focus on personal development, and to pursue hobbies and extracurricular opportunities – such as being an Uber driver – that will generate extra income.

Members of Generation Z like to be independent and judged on their own merits. They are entrepreneurial and creative, and they like to take ownership of projects. They like autonomy and want to work at their own pace and in their own space. (In fact, they do not like open office spaces; they would rather share anything than office space.)

But they are participative, too, and may pursue multiple opportunities at once, such as working in marketing two days a week and sales three days a week. They may seek job rotation programs that allow them to explore diverse options.

As visual learners who also absorb content in short stories, newsfeeds, and soundbites, Generation Z employees will look for ways to streamline processes, procedures, and how work gets done.

In the end, members of Generation Z are career planners who will push for transparency. They demand honesty from their leaders, and want to be able to look them in the eye and know they are getting the truth. While they will not expect their bosses to have all the answers, they are open to having a “guide on the side” and being mentored by a coach who truly teaches.


What do they want in Total Rewards?

Generation Z employees value the reliability of a steady paycheck. They want bonuses and promotions based on performance, not tenure. While salary and benefits are important, they also place significant value on being able to advance. Because they seek work/life balance, they also value flexibility and do not like a regimented schedule that does not allow time for personal breaks.

Ultimately, they want customized total rewards packages, not one-size-fits-all compensation solutions.


Bottom Line:

Generation Z employees are like no generation before them. They have grown up in the digital age and may have little patience for longstanding workplace methods. They will expect a lot from their employers, but also expect a lot from themselves – and are poised to deliver on that promise.

As an employer, using the generational profile information above, you can set the stage for tremendous contributions from your new Generation Z employees. In doing so, you can help them achieve their goals, and be rewarded with loyalty that recent generations might not have shown.

If you are not sure how to create and manage effective compensation and rewards programs for Generation Z employees, contact us today at 317.589.8529. We’ll be glad to discuss your needs.

Cassandra Faurote


About Total Reward Solutions:

Total Reward Solutions is your trusted partner for compensation and benefit services. Led by respected and professionally certified Human Resources expert Cassandra Faurote, Total Reward Solutions offers a broad range of compensation, benefits, performance management, and reward/recognition consulting services to help your organization attract top talent, motivate employees and retain top performers. We can partner with you on a project basis, on retainer, or as your total outsourced solutions provider for compensation services.

Call us today at 317.589.8529 to discuss how we can help your organization develop and implement competitive and effective compensation and total reward programs.

Posted Under: Compensation