Is Gen Z really a risk to businesses?
A lazy, entitled and narcissistic generation, more interested in TikTok than hard work. The stereotypes about Gen Z have, apparently, become so pervasive that managing a young workforce is now considered the biggest business threat by CEOs.
Just 38 per cent of executives are “very confident” in tackling demands for better pay and benefits from young workers, according to data from the PHA Group, shared exclusively with City PM. The report also said that jobseekers under 30 prioritise supportive team cultures, flexible working and a commitment to DEI when looking for a role.
For what it’s worth, City PM has always found our Gen Z staff to be as diligent and ambitious as anyone else. But if that’s peculiar to our organisation perhaps it’s worth asking why. People who grew up in the aftermath of the financial crisis have never experienced a healthy economy. Since 2008, the 2.9 per cent GDP growth Britain needs simply to keep paying for our current welfare state has only been achieved three times, two of which were during the post-pandemic rebound. While the levels of growth Britain enjoyed in the 80s and 90s more or less ensured that Gen Z’s parents and bosses had better lives than their predecessors, today’s young people have no such guarantee.
Policy decisions have put adult milestones increasingly out of reach
This is compounded by policy decisions that have put adult milestones, particularly home ownership, increasingly out of reach. Failure to build has driven property prices up 173 per cent in real terms since 1997, meaning a Londoner on an average salary would now need to save 10 per cent of their take-home pay for 30 years to afford an average property.
Added to this is a tax system that too often actively disincentives ambition. Thanks to loan repayments, a graduate earning £35,000 faces a marginal tax rate of 46 per cent, meaning that for every extra £1 they earn they will only take home 54p.
The reason Gen Z want employee benefits and jobs that align with their values isn’t because they’re spoiled and demanding, it’s because they know work doesn’t pay – at least not enough to afford things older people took for granted. Britain’s competitors are already waking up to this. Luxembourg is offering bonuses and tax exemptions for people under 30 starting their first job and Portugal has more favourable tax thresholds for under-35s to try to attract younger workers.
The real ‘threat’ to CEOs is that a generation without any capital loses faith in capitalism – on which all their profit and all our prosperity depends.