The Gen Z Dilemma: Why Pay Isn't Enough to Keep Gen Z at Big Brand Employers

In recent years, big brand name employers have been facing a significant challenge: retaining Gen Z employees. Despite offering competitive pay packages, many of these companies are finding that their young employees are leaving after only a few months on the job. So, what's driving this trend, and how can employers adapt to keep their Gen Z talent?

One of the key reasons Gen Z employees are leaving big brand name employers is that they are prioritizing more than just a paycheck. While higher pay might initially attract them to a job, it's not enough to keep them engaged and devoted to their company in the long run. 'Conscious quitting' is the norm, seeking jobs that align with Gen Z's values. Large Enterprises find that retaining new younger talent is becoming their biggest challenge that they face as they try to cope with 'conscious quitting'.

Gen Z employees want more than just a job; they want purpose and meaning in their work. They want to feel like they are making a difference and that their contributions matter. Unfortunately, many big brand employers struggle to provide this sense of purpose, leaving their Gen Z employees feeling unfulfilled and disengaged.

Another factor contributing to Gen Z's short tenure at big brand employers is the rise of remote work. While remote work offers flexibility, work life balance and convenience, it also comes with its drawbacks, particularly for young employees who are just starting their careers.

One of the most significant drawbacks of remote work for Gen Z employees is the lack of opportunities for networking, building colleague relationships, and making real connections for the future. In past generations if there was a layoff, workers had the ability to reach within their network and seek assistance. That skill and network is all but lost for Gen Z as they have only known colleagues behind a 30 minute team video call and have never had a single 'water cooler' moment. Without the chance to interact face-to-face with their colleagues, Gen Z employees may feel isolated and disconnected from their company, making it harder for them to envision a long-term future there... or anywhere.

Retention rates among Gen Z employees are dropping significantly, with many leaving their big brand employers after only 3-4 months on the job. Companies moving to an in-office requirement of four or more days are finding it’s a real point of contention to Gen Z. However, the ability to network is almost impossible with all remote. This is quite the dilemma!

Business Insider stated, " Among the key findings: 90% of Gen Zers and 92% of millennials said they were considering moving on from their jobs in 2024." This high turnover rate is a significant concern for employers, as it can be costly and disruptive to constantly be hiring and training new employees. From the employees point of view, “a lot of younger workers understand that their jobs aren’t secure, and they might have to find a new one tomorrow — that kind of attitude can breed confidence in a person, because they’re prepared for the worst outcome,” stated CNBC. While this is great resilience, it does leave big brands in a position where younger workers have no allegiance and will quit without a second thought having learned in the past a hard lesson of "at will" employment with the recent rounds of layoffs.

So, what can big brand employers do to retain their Gen Z talent? It all starts with the onboarding process.

The onboarding process is vital for welcoming and setting the stage for new employees to dive into company culture, meet colleagues, upskill and get certifications. It's also an opportunity to create communities of practice where employees can connect, collaborate, and learn from one another in a more relaxed setting that will foster mentorships and a real life colleague network. Onboarding is more than just paperwork and orientation sessions; it's a critical opportunity!

By investing time and resources into a better, more comprehensive onboarding program, big brand employers can give their new hires the best chance at success and convince them to stay and enjoy their work. A well-designed onboarding process can help new employees feel welcomed, supported, and engaged from day one, increasing their likelihood of staying with the company for the long term.

In conclusion, while higher pay might initially attract Gen Z employees to big brand employers, it's not enough to keep them engaged and devoted to their company in the long run. Remote work exacerbates this issue by limiting opportunities for networking and making real connections with colleagues or to gain mentorships. To retain their Gen Z talent, big brand employers must reevaluate their onboarding programs and the dull SaaS platforms they've invest in thus far. They must instead help HR by making investments into a new comprehensive onboarding processes and platforms that sets the stage for long-term success and engagement.

Key Take Aways:

1. Building Company Culture: The onboarding process is the first real introduction new employees have to your company culture. It's an opportunity to showcase your values, mission, and vision and help new hires understand how they fit into the bigger picture. By emphasizing company culture during onboarding, you can help new employees feel connected to your organization and invested in its success.

2. Creating a Sense of Belonging: Starting a new job can be intimidating, especially for Gen Z employees who are just entering the workforce. A well-designed onboarding process can help alleviate some of that anxiety by creating a sense of belonging from day one. By introducing new hires to their colleagues, providing opportunities for team-building, and fostering a welcoming environment, you can help them feel like part of the team from the very beginning.

3. Setting Expectations: Clear communication is key to any successful relationship, including the relationship between an employer and employee. During the onboarding process, you have the opportunity to clearly outline your expectations for new hires, including their roles and responsibilities, performance goals, and career development opportunities. Setting these expectations early on can help prevent misunderstandings and ensure that new hires are set up for success.

4. Training and Upskilling: The onboarding process is also an opportunity to provide new hires with the training and resources they need to excel in their roles. This might include job-specific training, as well as opportunities for professional development and upskilling. By investing in your employees' growth and development from the very beginning, you can help them feel valued and motivated to succeed.

5. Fostering Human-to-Human Relationships: In an increasingly digital world, virtual human-to-human interaction is more important than ever. The onboarding process provides an invaluable opportunity for new hires to build relationships with their colleagues, mentors, and supervisors. These personal connections not only make the workplace more enjoyable but also foster collaboration, communication, and a sense of community. By prioritizing virtual human-to-human interaction during onboarding, employers can help new hires feel connected, supported, and engaged from day one, increasing their likelihood of long-term success and retention.

6. Increasing Retention: Perhaps most importantly, a strong onboarding process can help increase employee retention, especially among Gen Z employees. Research has shown that employees who go through a structured onboarding program are more likely to stay with the company long term. By investing in your employees' onboarding experience, you can help ensure that they stick around for the long haul.