Gen Z is about to enter the job market as the largest wave of young professionals ever: By 2020, people born after 1996 will make up 40% of the workforce. Beyond its size, Gen Z is also the most ethnically and racially diverse generation. Employers need to invest in the next generation of employees now to stay competitive.
Until October 2008, I was chief executive officer of MF Global, then the world’s leading broker of exchange-listed futures and options. After three decades in finance, I started First Workings to give underserved and underrepresented high school students in New York City paid internship opportunities in competitive industries as a way to help them garner the social capital needed to succeed in college and beyond.
I’ve had the privilege of not only helping these students prepare for their summer internships at companies like Morgan Stanley, White & Case and Mount Sinai, but also received a glimpse into what our future workforce will look like before they enter the job market. Here are three things I’ve learned from them that might benefit your business.
- Gen Z brings interdisciplinary perspectives
Gen Z is much less likely to specialize in a single industry than previous generations. 80% of today’s college students change their major at some point during their degree program according to the National Center for Education Statistics. Students also seek more multidisciplinary fields of study and graduate with a wide breadth of knowledge rather than a single speciality.
A lot of our students at First Workings don’t yet know what they want to do with the rest of their lives, partially because they don’t know what’s out there yet. Many of them might end up in jobs that don’t even exist today. But they are excited to explore new fields and learn what different industries have to offer.
Seek out these students to bring interdisciplinary perspectives to your business. Industry-specific skills can be taught, but motivation and initiative come from an innate curiosity. When you find someone who is eager to learn, invest in them. You’ll find a lot of that in Gen Z.
- Offering paid internships ensures you’re not missing out on untapped talent
Interns who are paid are 72% more likely to get a job offer than those who are unpaid. Compensation is particularly important for students from low-income backgrounds who often can’t justify working without pay, regardless of future benefits.
According to a study by Georgetown University, students from a low socioeconomic status (SES) with high test scores are 40% less likely to be in a high-SES bracket by age 25 than students from a high-SES bracket with low test scores. Simply put, if you are from a low SES, you are less likely to “make it” despite academic promise. Paid internships allow businesses to access talent they would otherwise miss out on.
Many of our partner companies, including Nasdaq, Hart Media and RAND Engineering & Architecture, have repeatedly sourced diverse interns from our pool of students. LCM Commodities, a partner since 2015, was so impressed by how their First Workings intern Lemuel Bergos picked up financial and energy derivatives that they sponsored him to take exams that would qualify him to play a more client-facing role.
- Gen Z is redefining “work-life balance” and workplace culture
The rules of the workplace are shifting and businesses must begin to shift their company culture to attract and retain talent. Work-life balance has been steadily declining, to the dissatisfaction of many employees. Gen Z is more focused on work-life balance than their millennial or Gen X predecessors. Many of the students I talked to said they want more flexible work options.
Culture is another common theme our students are concerned about. Gen Z wants to feel comfortable to authentically express themselves in the workplace. One question that came up among our students was if natural hair was “allowed” in a professional setting. As Gen Z enters the workforce — along with their workplace values — businesses will need to allow more freedom of expression in their dress codes.
Companies in the top quartile for racial and ethic diversity are 35% more likely to outperform national industry medians, making them more profitable than their competitors, according to a report by McKinsey and Company. In the US, the relationship is linear: the more diverse a company’s workforce, the greater its financial returns. Re-evaluating “traditional” company culture is a small price to pay for higher earning potentials.
As Gen Z assumes a larger role in the workforce, companies need to shift the way they recruit and train talent. My experience has taught me that it’s well worth the investment.
Written by Kevin Davis.
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