What motivates Gen Z in the workplace? Six strategies to recruit and retain Gen Z

“The problem of leadership today is that managers are still applying the Industrial Age control model to knowledge workers. They fail to tap into the highest motivations, talents, and genius of their people.” — Stephen R. Covey

If you manage to stay up-to-date with the latest changes to all things psychological and psychosocial (in terms of workplace health and safety, and risk management), we applaud you. If not, we don’t blame you! Scrolling through LinkedIn, we constantly see people discussing “new” concepts, frameworks and words we’ve never heard of. But when you strip it back, most of these conversations centre around the same fundamental goal: creating workplaces where employees are happy, and organisations can perform well.

Yes, businesses need to meet their basic legislative requirements. But a common thread underpinning all this focus on psychological health and wellbeing is a desire to keep employees satisfied and create environments conducive to employee wellbeing and high performance. What we find especially intriguing is how the newest workforce generation, Gen Z, is changing the way we view, carry out and value work.

How Gen Z is changing the world of work

A recent report by Deloitte says that as they move into their 30s, Gen Z will make up around one-third of the world’s population.

Gen Z is starting to pave the way for how we approach and value work. Noting some of the conversations around their work ethic and attitudes, there are many articles and debates online about their supposed poor work ethic and being labelled as “lazy”.

However, looking into the research and trends in the workplace, we are seeing Gen Z changing jobs more frequently than previous generations. Not because they’re lazy, but because Gen Z is putting greater importance on job satisfaction (and money and wellbeing) as a big motivator for career changes.

Some recent New Zealand data (courtesy of Jarrod Haar’s wellbeing@work research), found that Kiwi Gen Z report lower job satisfaction, less meaningful work and less work-life balance than everyone else.

How can organisations and people leaders better support the incoming generation of workers? Organisations that fail to prioritise this will risk losing the race for tomorrow’s best talent.

The top values for Gen Z workers

If given the choice of a better-paid but more boring job versus work that was more interesting but didn’t pay as well, which would you choose?

Gen Z are fairly evenly split over the choice. While salary is often the most important factor in deciding on a job, Gen Z tend to value salary less than every other generation.

So, what is Gen Z valuing? They are putting more importance on aspects of work such as meaning and purpose, growth, mental health and wellbeing, flexibility, and work-life balance.

Researchers suggest that Gen Z are looking for a company where they are not just a number, but are in a position and place to make a significant contribution, where work is meaningful and sustainable (Kennedy, 2024; Popaitoon, 2022).

The 2024 New Zealand Health Survey also revealed that young adults (aged 15 to 24 years) are most likely to experience psychological distress, and that this has been increasing over the last five years. What does this mean for organisations?

Prioritise psychological safety

Prioritise psychological safety. High levels of psychological distress in young people is a “wicked problem”, meaning there are many causes, contributors, and factors that are interconnected – making it complex. However, if we can start to address one piece of the wicked problem, we can start to create momentum on generating positive change.

Psychological safety is important for creating a judgement-free environment, where employees can come to work as their true selves, can express their ideas, ask questions openly, speak about their concerns and admit to their mistakes. A study from University College London, on low socio-economic status young adults, found that a common theme among them was their sense of feeling disconnected, based on the “fear of being judged, rejected, or viewed in the ‘wrong way’ by others” (Fardghassemi & Joffe, 2022, p. 7).

Given that psychological safety is a modifiable factor in organisations, this is one area that can make a big difference when it comes to enabling people to be who they are, and to learn and share information in a safe space, to maximise performance.

Leaders and team members all play a role in developing the culture. Psychological safety is particularly important for Gen Z. A work environment where people can “fail” in a safe space, take risks, make mistakes, and build skills and confidence to learn and grow taps into their core values. These values include personal growth and development, having purpose, and making meaningful contributions in their work.

Below we cover some key action points for improving psychological safety in teams and some general tips for organisations and leaders to better support the Gen Z workforce.

Six strategies to support the Gen Z workforce

Understand your employees’ values (Gen Z and others)

Aligning the organisation’s values with people’s specific roles helps to provide clarity to employees about how they contribute to the wider goal and vision of the company – which adds to their sense of purpose. When there are clear connections between team members’ daily contributions and the organisation’s mission, values and goals, people feel more engaged, invested and derive more meaning from their work. An example of this might be having conversations with employees and encouraging them to reflect on what energises them. This way, we can start to unpack what aspects of work are more meaningful to them.

Invest in training and development

Provide opportunities for professional development, mentorship and clear career pathways. Equipping employees with the tools and resources they need, connecting them with networks of professionals early on, and providing shadowing opportunities is essential for attracting and retaining the “talent of tomorrow”.

Promote psychological safety

Leaders, especially immediate managers, play a critical role in developing and improving the psychological safety of teams. Employees spend significant time with their leaders and look to them to model acceptable behaviours. Leaders can promote psychological safety in their everyday interactions by encouraging open communication and diverse perspectives, demonstrating vulnerability and accountability, and recognising and celebrating people’s unique contributions. You can also check out our popular half-day workshop designed for leaders on “Creating Psychological Safety”.

Support flexibility as an expectation

Gen Z employees are a group who entered the workforce during a time when remote and hybrid work boomed and there isn’t much excitement about going back to five days in the office (something they may have barely experienced). Flexibility is a top priority for many Gen Z workers. It’s not about doing less work, but more about having autonomy and trust, while still delivering on the outcomes expected of them. Examples of this include providing flexible working arrangements and implementing anchor office days rather than mandating five office days a week, a trust-based approach where employees can flex their hours or location to suit them best, duck out for a doctor’s appointment without sideways glances.

Prioritise diversity and inclusion

Gen Z value cultures that are authentic and enable people to express their true selves in an environment where employees feel valued and included, regardless of identity, background or perspective. Diverse teams and cross-collaboration are great ways to foster creativity and innovation. Building the cultural competency of leaders and staff members is also a common area we’re seeing more organisations focusing on.

Build mental health awareness

Mental health support for Gen Z employees isn’t optional. This appears to be the case for many employees, not just Gen Z. However, recent data from Te Hiringa Mahara (the Mental Health and Wellbeing Commission) indicate that those aged 19 to 24 have experienced the largest relative decrease in access to specialist mental health and addiction services (despite increasing rates of distress for young people). Not only is it critical for employees who may be struggling to access the support they need, but workplaces and managers have a responsibility to be equipped to have open and honest conversations about mental health. A key part of this is managers also knowing how to point employees in the right direction for resources/support for help if they need it. Another great initiative is to ensure your leaders and team members have done a psychological first aid training in the workplace to learn how to effectively and compassionately navigate mental health and illness at work.