The facts
Generation Z, a demographic force of more than 2 billion people worldwide, is currently on the cusp of tremendous change. Those born between 1997 and 2009 make up about 30% of the total global population. They are projected to make up about 27% of the workforce by 2025. These numbers are impressive at first, but they don't tell the whole story. The global pandemic has brought with it a wave of unemployment that has hit Generation Z the hardest.
The Organization for Economic Cooperation and Development (OECD) defines "unemployed" as people of working age who are unemployed, available for work, and actively seeking employment. By this definition, Generation Z's unemployment rate has risen sharply and diverges alarmingly from the rates of older generations.
The timing is decidedly unfortunate. Generation Z is just beginning to enter the real world, graduate from high school and college, and navigate the labor market. To make matters worse, Generation Z is overrepresented in the sectors most affected by the pandemic, such as service industries, including restaurants and travel. In the U.S., for example, about 25% of young people work in the hospitality and leisure sector, where employment fell 41% between February and May 2020.
In countries like Spain, the situation is even more severe. With a high overall unemployment rate of 14% for those aged 25 to 74, the unemployment rate for Generation Z is twice as high at over 38%.
But we don't just see hardships and challenges in Generation Z. But above all resilience, creativity and adaptability.
Navigating uncertain waters
Despite the discouraging statistics, there are positives to report. Interestingly, Generation Z has proven to be more risk-averse and financially savvy than their predecessors. This prudent approach to finances and careers was evident even before the COVID-19 pandemic.
In addition, Generation Z has the unique distinction of being the first truly digital generation that cannot remember a time before the Internet. This ingrained digital nativity equips them with an unparalleled ability to navigate the online world - an area that has become even more important in the face of a global pandemic and will define the future. These digital natives will naturally and with a fresh outlook integrate new technologies such as AI and ChatGBT into their professional lives with ease.
In addition to their digital skills, Generation Z is also considered the first global generation. They have grown up in a connected world where unlimited information is available to you, and you can engage with different cultures and ideologies from the comfort of your own home. This global perspective will create new ways, innovative sources of income, and thus redefine the concept of work in the long term.
The potential of Generation Z
While the challenges facing Generation Z are significant, their potential to overcome and innovate is immense. As digital natives, they have an innate understanding of online platforms and virtual interactions. Combined with their global perspective, this opens up a world of opportunity for remote work and digital entrepreneurship, areas that have grown in importance and necessity due to the pandemic.
In addition, we believe that emerging financial prudence is driving them to create more sustainable and resilient economic models. This also points to a generation that may be better prepared to deal with financial uncertainties in the future, despite the economic impact of the pandemic.
However, Generation Z's path will not be an easy one; our role and attitude to empower and encourage them will be critical. We need to ensure that this generation gets the support they need, for example in the form of mentorships, promotion of knowledge and guidance during career orientation. We need to create bridges, digital leadership and support concepts in order to be able to respond to the needs of young professionals as well as possible. The result will be a generation that makes sustainable decisions based on knowledge and experience from previous generations combined with its own.
Brave New Work
Their digital savvy and global perspective put them in a unique position to leverage the digital economy and redefine traditional career paths.
However, these opportunities do not diminish the immediate challenges they face. High unemployment and industry upheaval combined with a transitional period in their lives have created a raging storm. Together, we can create the greatest growth and change in times of great difficulty.
As we move forward, it is critical that we give Generation Z the tools and resources they need to navigate this turbulent environment. This includes not only practical resources like offering them jobs and the financial support that comes with them, but also psychological support. The psychological toll that the pandemic has taken and continues to take cannot be underestimated. We must prioritize mental health alongside economic recovery. This has nothing to do with effeminacy, but with trauma coping.
Each generation has its own diversity of experiences, perspectives and skills. We need to recognize and acknowledge these differences and tailor our supports and resources to meet the different needs of each generation.
The Kids are not alright - but we can support.
Ultimately, Generation Z will find its way. Yes, they face unprecedented challenges. But they also have unprecedented potential. As they move into a world, they will use their unique strengths to innovate, adapt and ultimately shape the future of our global society. You will be the architects of a brighter, more resilient future. We are convinced of that.
by Catharina Biester, Growth Expert