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Generation Z is About to Enter the Workforce. Here’s What You Need to Understand About Them

Have you seen the current list of things that Millennials have ruined? Before I even filled in the Google search bar, it suggested that they had ruined not only brunch and America, but everything. We’ve ruined wine corks, hotels, movies, the retail industry, handshakes, the European Union, American democracy, professional sports, both the Democratic and Republican parties, and the Internet. For as many prattling articles as there are describing the ways in which society as we know it is being reshaped in the hands of Millennials for the worse, there are just as many extoling their virtues and countering claims made against them.

While Millennials are the target generation du jour for marketers, politicians, corporations, and Baby Boomers, they are quickly becoming replaced in conversation by Generation Z. This young cohort of individuals born after Millennials. While the cutoff dates are hazy among any generational definition, Gen Z typically refers to those born 1996 and after. As of 2017, Gen Z’ers are 21 and younger. In the United States, they make up roughly 25% of the population.



Who is Generation Z?

So who is Gen Z? An age range alone doesn’t tell us much about their habits, relationships and ways they interact with the world. Thankfully, this question is one that people in all kinds of sectors, from government and policy to retail and marketing, are asking themselves. Market research, demographic studies and self-reporting studies are attempting to answer this question for us.

While the cutoff dates are hazy among any generational definition, the young cohort typically referred to as Gen Z is generally comprised of individuals born in 1996 and after. As of 2017, Gen Z’ers are 21 years of age and younger, making them the youngest defined generational group right now. In the United States, they make up roughly 25% of the current population, a larger percentage of the population than Millennials and Baby Boomers.

Called the digital generation, Gen Z is often defined by their relationships with technology, particularly mobile and digital. They are digital natives, meaning that there has never been in a time in their lives when they weren’t in direct contact with some form of Internet technology. Gen Z is the most technologically comfortable generation and use technology at higher daily rates than other groups. They rely on mobile technology even more than Millennials, and are four times more likely than Millennials, Gen X, and Baby Boomers to say that 13 is the right age to get your first smart phone.

Technology is a large part of their lives and they use it as a way to interact with the world and with each other. As a growing cohort, their demand for new and better technology will shape consumer demands in t he coming years. By 2019, millions of Gen Z’ers will have entered the workforce, and will hold roughly $3 trillion in purchasing power by the following year. Generally the children of Generation X and Millennials, Gen Z differ from their parents and older generations in significant ways, both in terms of their demographics and their consumer behaviors and preferences.

How do they engage with brands and companies?

The media habits of Gen Z are similar to Millennials, but differ in a few important ways. Gen Z’ers are major consumers of media, spending hours each day consuming both branded and user generated content. A full 86% of Gen Z’ers say that they check their smart phones periodically throughout the day, making them the most technologically connected generation yet. This is incredibly important for startups and small business to take into account.

Your mobile presence is the most likely platform with which Gen Z will engage with your brand. As the popularity of mobile purchasing and use increases, your site needs to be compatible with mobile and the value of ecommerce channels will rise. Test your site on a variety of different mobile devices to ensure that your design is optimized for mobile viewing and consider adding ecommerce options so mobile users can directly purchase your products and services from the comfort of their smart phones. Keep in mind that Gen Z are twice more likely to want to shop on their mobile devices than even Millennials and make purchases accordingly.

Mobile ads are also rising in popularity. The traditional celebrity influencer is being replaced with real people as 63% of Gen Z’ers say that they’d rather see regular people in ads than celebrities. Visual content is still king, and relevant images and videos appeal to Gen Z, who are accustomed to digesting information quickly and have little patience for long winded spiels. According to Hubspot, social media posts that have a relevant image garner 94% more engagement than the same post sans photo. The rate of 94% more engagement reflects patterns among all generations, and it may be safe to assume that the engagement rate for Gen Z is even higher.

Determining how much of your marketing budget should be allocated to social media ad buys should reflect your current engagement on these platforms and whether you are reaching your target audience. If you are looking to target Gen Z, the platform you choose is critical. Gen Z is less likely to use Facebook, and more likely to use Instagram and YouTube. Linking posts back your website will drive traffic between your owned and paid media. A frictionless experience between ecommerce and your platforms is essential, as Gen Z’ers have little patience for poorly optimized sites and devices.

Gen Z as a pluralist group

In the United States, Gen Z is the most ethnically diverse generation in the history. Reflecting changing patterns in American demographics, nearly 50% of Gen Z are ethnic minorities. Social norms have been flipped from past generations and Gen Z is more likely to challenge stereotypes and characterize themselves as inclusive than other generations. They are challenging tradition and they’re not afraid to speak their minds and to share their thoughts with others online. Gen Z uses social media and the power of technology as a way to voice their beliefs and to call for change.

They watched as Millennials helped to legalize gay marriage and elect the first African American president. They also have seen the nasty side of politics, racial inequality, and social divisiveness and how it can affect their communities both at home and elsewhere. Gen Z’ers see themselves as individuals, but also as a part of a collective society that can work together for good. This reflects their purchasing habits as well. 60% expect brands to align with and support causes that they agree with and want brands to be transparent about their beliefs.

While the majority of Gen Z members are not of legal voting age yet, those that are have been following Millennial trends and voting in high numbers. The Pew Research Center found that Millennials and Generation Xers cast the majority of votes in the 2016 election, the first election that Baby Boomers and older generations were the largest electorate. The Pew Research Center included older Gen Z voters, those that were over 18, in the Millennial category. Young voters, including Gen Z and the Millennials, are more likely to describe themselves as independents, but they tend to vote as Democrats. In 2016, 55% of all Millennials and Gen Z voters identified as Democrats or Democratic-leaning independent, compared to just 33% that identified as Republicans and Republican-leaning independents.

The new entrepreneurs

Gen Z is also perhaps the most entrepreneurial generation yet. According to a study of Gen Z’ers done by Millennium Branding, 72% of high school students and 64% of college students want to start their own businesses. As they consume massive amounts of media, they see other Gen Z and Millennial influencers who have built a following out of social media platforms, startups, and by generally disrupting the corporate world.

Over 40% of Gen Z’ers think that they’ll work for themselves at some point in their careers. Keep in mind that according to the U.S. Census, about 10% of Americans work for themselves. This speaks to how entrepreneurially motivated this generational cohort is, and how they envision their vocational futures. Moving past the Boomer generation that often worked the same corporate job for the entirety of their career, this upwardly mobile generation sees entrepreneurship and self-employment as a goal to work towards.

They have access to resources to help them along the way to becoming their own bosses, and they take advantage of them. Gen Z will likely be the most educated generation in history, as indicated by their higher rates of on-time high school graduation, and their high levels of engagement open them up to networking and finding freelance clients more easily. They grew up during the Great Recession and are keenly aware of the struggles their parents faced in the face of economic uncertainty. Being privy to the largest financial crisis in recent memory has left Gen Z more risk adverse than other generations.

The Economic Impact of Gen Z

The high rates of entrepreneurship and desire to be their own bosses may stem from Gen Z’s experience of growing up during economic crises. More than 1 in 5 members of Gen Z lived in poverty in 2014, despite rising employment rates as the economy rebounded from the Great Recession. Economic security is valued across generations, but Gen Z seems to be turning towards entrepreneurship, independent and freelance work, and startups as a way to secure their own financial futures.

Despite living in a recovering economy, they are more individualistic than older generations and see themselves as the influencer of their fates. Highly ambitious and motivated, even though Gen Z is still coming of age, they cannot be counted out. Patrick McCarthy, President and CEO of the Annie E. Casey Foundation, which has conducted significant demographic research on this generation, says about Gen Z, “This generation of teenagers and young adults are coming of age in the wake of the worst economic climate of nearly 80 years, and yet they are achieving key milestones that are critical for future success. With more young people making smarter decisions, we must fulfill our part of the bargain, by providing them with the educational and economic opportunity that youth deserve.”

The current climate of our world is a challenging one. Even at their young age, Gen Z has seen both crises and successes play out on their digital screens in real time, which is both a privilege and a burden. With an entrepreneurial drive and goals that are often strongly correlated with career achievements, Gen Z is poised to make major splashes in the startup and corporate world.

Even before they have fully entered the workforce, Gen Z commands significant influence over their family spend along with their own purchasing power. It’s time for startups and corporations alike to start paying attention to Gen Z not just as the young teens of the world, but as savvy customers who are skilled at navigating between platforms and using technology to inform their purchasing.

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Staff Writer: Cassidy Welter is a Chicago based researcher at a consulting firm specializing in nonprofits. When she's not working, she's reading anything she can get her hands on, debating politics, watching the Pittsburgh Penguins and eating her way across the city's food scene. See more from Cassidy on Twitter at @CassidyWelter.

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Staff Writer: Cassidy Welter is a Chicago based researcher at a consulting firm specializing in nonprofits. When she's not working, she's reading anything she can get her hands on, debating politics, watching the Pittsburgh Penguins and eating her way across the city's food scene. See more from Cassidy on Twitter at @CassidyWelter.

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