New Kids on the Block - Transcend Commercial Real Estate Brokerage

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May 13, 2021

New Kids on the Block

New Kids on the Block

How the Pandemic Rocked the Career Paths of Younger Generations and What Changed

Chances are, if you’re reading this, you’re not a 21-year-old working from your communal futon in your first apartment shared by no less than three other 21-year-olds.

21-year-olds are not typically avid readers of commercial real estate blogs, but no offense taken here. What’s interesting to consider though, for our more “seasoned” readers (that’s you 😉 ), is how this year and the disruptions we’re seeing to our economy will impact that 21-year-old, newly-graduated guy or gal over the first decade of their career. When they are in a stage of their work-life to think about office space, or the culture of their business, or how to balance team productivity and connection, what will their options be? What will they think about their workplace? Will they even have the opportunity to reach some of the milestones that many of us (a decade or more into our careers)? Will they care about what we care about?

According to recent studies, 2020’s graduating class entered a job market crippled by a 14.7% unemployment rate— greater than the 10% unemployment rate the Great Recession saw at its 2009 peak. A year later, the economy has shifted and job opportunities abound, but the way these newbies want to work may impact their long-term contribution to businesses everywhere.

Data is showing that a few trends are emerging with younger generations in their work-life that may follow our businesses well into the future. A few prominent trends being:

  1. Job hopping
  2. Entrepreneurial leaps 
  3. They want a place to work

Job Hopping

While hopping from one job to another is not uncommon for workers in their preliminary years as they discover values and passions in a job, the rate for this generation is unusual.

A CNBC article reports, workers have been job-hopping in the hopes of attaining better pay and career mobility in the uncertain Covid-19 economy, and it is a trend that millennials and Gen Z are expected to dominate again in 2021.

One in four workers plan to switch jobs this year, an increased pace compared to last year. Of the one in five workers who switched jobs last year, 33% identified as Gen Z and 25% as millennial, according to a new study from IBM’s Institute for Business Value.

Gallup identifies millennials as the most likely among generations to switch careers and suggests that six in ten millennials are open to new job opportunities

Before you make assumptions about entitlement and instant gratification, two traits that are common labels for this generation, there are other factors at play to consider. 

Hannes Schwandt, an economic demographer, found that the problem isn’t necessarily a lack of jobs or a sense of personal entitlement; it’s that recession graduates start at “lower-quality” jobs. But even that outcome can have benefits, he said. “Over time, what you see in these cohorts is a higher degree of mobility from one employer to the next. It helps them climb up the quality ladder.”

And climbing is very important to this group, like very important.

A CCB report, which surveyed more than 1,000 Gen Z workers, found that younger workers are much more concerned about the future of their careers than their older colleagues. Some 68% of younger workers reported that they worry about their career growth potential—compared to 43% of older employees.

“It’s a period with a lot of changes and combined with strong economic growth, people are no longer afraid to switch jobs,” said according to Gad Levanon, vice president of the Labor Markets Institute at The Conference Board.

Younger Americans are updating some of the tactics in career switches for a changing world. Not only are younger workers seeking job mobility, but they’re also looking for flexible and remote work schedules, a need that’s come to the forefront amid Covid-19.

As an ambitious crew, they also aim to grow, develop competitive advantages, and take risks to climb the ladder.

Entrepreneurial Leaps

Some of this younger generation is so driven to create a path for themselves, we’re seeing a rising number of innovative and entrepreneurial solutions in lieu of job-hopping or taking lower-paying jobs.

In fact, job-hopping statistics are actually lower than the job-hopping rates of previous generations. Instead, Gen Z and Millennials tend to opt for less traditional “hops” to make a buck.

Over the last decade, many millennials have relied heavily on the gig economy which boasts jobs like ridesharing drivers, delivery workers, and freelance writers. The industry’s seen rapid growth during the pandemic and a recent study from Upwork found that gig workers contributed $1.2 trillion to the U.S. economy during the pandemic, a 22% increase from 2019.

Many 2020 grads were shocked last March to find that their long list of dream, first-time jobs was no longer an option as businesses cut back and closed their doors. So, creativity was the key.

One 2020 grad, Emma Havighorst traded her list for a paid internship, managing social media channels for Next Gen HQ, a business hub that aims to empower entrepreneurs. She hopes it can turn into a full-time role come August. As a passion-project and fun side-hustle, she also hosts a podcast, “Generation Slay.”

In her estimation, the pandemic will produce even more innovators.

“Necessity breeds invention,” she said. “We’ll be trying to figure out solutions to problems that plagued past generations.”

They want a place to work.

Wanting a place to work might seem obvious, but we’re talking “place” not just a figment of a business that appears once a week on a Zoom call. While this generation desires flexibility in their work schedules, they also know they’re missing some crucial connections being stuck at home.

Chip Hunter, dean of the Carson College of Business at Washington State University said, “Navigating remote work with little experience to fall back on has proved challenging for them, particularly when it comes to their mental health. It’s not hard to see why when we consider their typical living arrangements, their limited financial resources, and their desire for independence.”

He also points out that compared to older employees, Gen-Z employees are more likely to be impacted by pain points such as at-home distractions, decreased ability to focus, and a disrupted work/life balance. “Additionally, our Gen-Z workforce thrives on social interaction and connectedness,” says Hunter. “Having been in the workforce for such a short time, many have not had the opportunity to build meaningful career connections or experience the full breadth of their company’s culture, which can be disheartening.”

So, back to us—the old guard. 

What’s the best way to not only support the businesses we’ve invested time, energy, expertise into through a changing work environment but bring along the generation that will carry it forward years from now?

Some say it starts with meeting them where they want to be. As the economy strengthens, new workers are driving for higher wages and increased mobility. This is a signal to businesses that they need to shift how they prioritize and invest in employees to retain talent whether it’s compensation, culture, work environment or plans to help them grow in their roles. 

All in all, these newbies—like all of us once were—are a generation of people who want to make change for the better. Maybe connecting with them in new ways while they are working from that communal futon will make a difference in the business as a whole three, five or even fifteen years from now.

 

Sources:

https://www.businessinsider.com/gen-z-class-2020-graduates-future-career-recession-2020-5

https://www.businessinsider.com/remote-work-pros-cons-younger-workers-gen-z-millennials-2020-5

https://www.cnbc.com/2021/02/28/millennials-gen-z-are-job-hopping-but-maybe-not-enough.html

https://www.forbes.com/sites/markcperna/2021/04/27/ok-boomer-5-surprising-insights-into-what-gen-z-workers-want-in-a-job/?sh=72fb9c3e760b

 

 

 

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