It is predicted that by 2025, Millennials and Generation Z will make up the majority of the global workforce.
Currently, there are four generations in the workforce: Baby-boomers, Generation X, Millennials and the youngest Generation Z. As each year passes, this generational mix of workers evolves and as the baby-boomers begin to retire, millenials and Generation Z make up a greater portion of the workforce. In this post, we examine the profiles of the new generation of workers, millennials and Generation Z and how they influence and shape the workplace.
The Millennials, who were born between 1985 and 1997, continue to enter the modern workforce and are rapidly reshaping the global world of work. It is predicted that by 2020 they will make up circa 50 per cent of the global workforce and by 2025 over 70% of the global workforce will consist of Millennials and Gen Z, the new generation that consists of people born after 1997.
Directly contrasting the preceding baby boomer generation and generations X, millennials and gen z are bringing new skills into the workplace and are seeking more flexibility. Extra effort must be made by businesses, who need to rethink their strategies and recruitment procedures in order to attract and accommodate this new breed of worker.
What makes Millennials and Generation Z different?
Millennials witnessed the world go from dial-up internet to fast speed broadband and Gen Z grew up with technology ingrained in their lives. Gen Z are the true digital natives, accustomed to the instant availability that comes with a technology-centric upbringing.
Both generations are well versed in multiple skill sets, as they have relied on practical experiences to gain their knowledge rather than via the formal education routes. These attributes make for a very flexible and dynamic workforce, ready to take on challenges that previous generations might struggle with; however, this flexibility comes at a cost, and engaging with these workers often requires a different approach.
Compared to previous generations, both millennials and Gen Z have experienced major economic crises, during their formative years. For many millennials, this has had a profound impact on the level of trust they place in businesses and as a result, they tend to prioritise their own personal needs as opposed to the needs of an employer. In fact, a survey of millennials from Bentley University found that only 13 per cent of respondents considered ‘climbing the corporate ladder’ to be a career goal, with 67 per cent stating that their primary goal was to start their own business.
A recent US study conducted by the Freelancers Union discovered that millennials are the largest contributors to the growing freelancing industry at 35 per cent. This figure reflects the flexibility that millennials crave, which is a major contributing factor to the growth in today’s contingent workforce. For businesses who want to attract and more importantly retain millennials and Gen Z workers, employers will need to offer significant financial rewards as well as a flexible workplace culture. In fact, Millennials are more likely to stay in their jobs when their workplace offers higher degrees of flexibility. Those who are less satisfied with their pay and work flexibility are increasingly attracted to freelancing and the opportunities that the gig economy can offer them. The trend that millennials have set regarding increased flexibility in their workplace is still growing. In addition, while the contingent work trend did not begin with millennials, both millennials and gen z will soon outnumber baby boomers in the workplace and will continue to be a key driver for future growth. In fact, 46 % of Gen Zer’s are freelancers and the numbers are forecast to continue growing.
The Gig Economy
As a greater number of millennials and Gen Z enter the workplace and the trend towards contingent working continues to increase, employers have been adapting their traditional views on employment. This has become particularly apparent with the rise of the gig economy which is structured into smaller projects and is typically facilitated by an online platform or app, making it a popular option for the millennial and Gen Z workforce.
There are two key characteristics of millennials that fit perfectly into the gig economy and that companies will need to cater for when seeking their expertise: their breadth of experience and interests and the slightly contentious issue of attention span. Having grown up accustomed to instant access to online knowledge, millennials are often perceived as lacking patience and seeking new opportunities too quickly. As with all generalisations there are of course many exceptions, but these are, nonetheless, factors, not necessarily negative, that must be considered.
Where previous generations sought to spend many years perfecting their skills in a particular field, millennials will tend to seek varied professional experiences that match their interests and are less afraid of changing professions during their professional lives. For employers this can be both a great advantage and something to watch out for in equal measure. Engaging with millennials gives access to individuals with greater flexibility and more diverse expertise, but who must be managed and kept interested with a variety of diverse tasks. These characteristics of course fit perfectly into a gig economy typified by shorter-term, more specialist projects undertaken by an on-demand workforce.
Businesses that choose to engage with gig workers have access to an incredibly powerful, talented and flexible workforce, and their significance to an organisation should not be underestimated. For businesses seeking support for project work, or particular areas of specialism, engaging with gig workers provides an effective and efficient solution for the company and the benefits for both parties are incomparable; gig working provides millennials with the flexibility they desire while saving businesses the administrative and financial burden of hiring permanent members of staff. In addition, gig workers provide companies with an intense level of specialism that may not be available from a more ‘all round’ employee.
The challenge, however, comes from how employers attract, engage with and ultimately retain these workers. Loyalty is a key issue as gig workers are not formally tied to a business and employers may question what stops a gig worker from going on to work for a competitor once a project is complete. With this in mind, it is critical that employers consider how they position their company as an attractive option for these types of worker to continue working for them on a gig basis.
What happens next?
While millennials and Gen Z’s are considered similar due to their love of technology and flexibility in their job, there are differences. Generation Z currently aged 14-24 will enter the workforce sooner than expected as many now prefer to enter the job market earlier by bypassing university. This group of workers prefer to learn their skills on the job. Gen Z’ers just like millennials grew up with technology and therefore want to use technology to adapt their work with their lifestyle.
Considering that by 2025, 75 percent of the global workplace will be Millennials and Generation Z, it's important for organisations to adapt their engagement strategy in a way that’s consistent with how these new generations communicate and work. Therefore, if a company still has not faced the challenges that the Millennials brought over the last five years, it is definitely time to come up with a strategy as the Gen Zer’s are coming and in much bigger numbers.