How will your decisions today shape the future for generations to come?

Demographic and technology shifts are changing how we work, spend and communicate. Rethinking generational dynamics can unleash growth.


In brief
  • The workplace of the future is here now, and it’s home to five generations, encompassing a wide range of experience and knowledge.
  • The newest generation, Gen Z, has a new view on the workplace and is rewriting the rules, using technology earlier generations could have only dreamed about.
  • Organizations that rethink structural models of the past can unleash the power of a multi-generational workforce for growth.

The decisions leaders take today will impact the world for years and decades to come. This is nothing new, but the consequences, and legacy, of these choices are particularly stark, especially around artificial intelligence, sustainability and social equity. As leaders build the tomorrow for future generations, they have an opportunity to listen to the concerns and hopes of Gen Z, already entering the workplace, and Gen Alpha after them.

But the current fascination with generational dynamics isn’t all about legacy. It is also caused by five generations working together for the first time. That adjacency is highlighting the differences in experiences, skills and outlook, just as technology is accelerating the pace of change and bringing all generations closer together. Moreover, this multiplicity of generations co-habiting the workplace is no blip: In advanced economies, aging populations and falling birth rates are creating a squeeze on skilled talent that will continue through 2050. The opportunity to harness diverse skills and viewpoints across generations has never been greater, just as the challenges rising to meet us are more complex, more interdependent and more intractable than in the past.


However, the study of generations is an inexact science: generations have fungible boundaries; they are not homogenous groups; culture and geography have a profound impact. The range of recent EY research studies separates the myths from the meaningful. This paper pulls together insights from this broad research base as well as drawing on external data to explore generational dynamics in the workplace, in consumer behavior and in society more generally. Gen Z is exerting an increasing gravitational pull across generations, changing the mood music for everyone.

Throughout history, new generations jettison the orthodoxies of the past, allowing clogged pipework to be cleared and new ideas to flow. Since Aristotle, older generations have bemoaned the state of the young. But Gen Z has attracted more than its fair share of pejorative labeling: lazy, anxious, distracted and disloyal are well-worn media headlines. In “Industry,” HBO’s high-octane Gen Z workplace drama set in the heat of a fictitious London investment bank, the fledgling financiers are just as scheming, as ruthless and amoral as their forbears, Bud Fox or Gordon Gekko in the 1987 movie “Wall Street.”

In our interviews with first jobbers and senior partners within the EY organization, we find both consistencies and differences in how they see (and saw) their careers. It may have been over a decade since Daniel Pink wrote his 2011 bestseller, Drive, but his three motivators – autonomy, mastery and purpose – continue to resonate with the youngest generations to enter the workplace.1 Human psychology has not fundamentally changed. However, in the latest EY 2024 Work Reimagined Survey, we find sharp differences in what different generations value at work. If we look across our 15 major generational research studies, we see patterns emerge that play out in our behaviors and preferences as consumers and citizens; in how we envisage success, in who we trust, in the importance of family and community and in our attitude to technology and its impact on the future.

For all that unites us across generational divides, major shifts are not just accelerating change, they are opening doors to new possibilities. Shaping the future of employees, consumers and citizens through a generational — and profoundly human — perspective requires a deep and strategic understanding of emerging societal needs. Together, we’re not just witnessing the future; we are all in on actively participating in its creation.



Chapter 1:

The polycrisis of demographics

As populations across the developed world are getting older, the workforce is shrinking.




The global distribution of generations is becoming more and more unequal, as developed economies as well as those on the rise see their populations age and diminish, while the poorer areas of the world are also the youngest. Demographic pressures are at their most intense in countries with shrinking populations such as Japan (where 30% are aged 65 or older), the EU (22%), South Korea (18%) and China (14%). At the same time, birth rates are plummeting in countries across South America; in Colombia, for example, births have declined by 22% over five years.2 Overall, competition for young, skilled talent is intensifying, prompting countries to implement targeted immigration policies and incentives to shore up workforce participation.


In the US, the “Peak 65” demographic benchmark shows that over 4 million will reach 65 this year and then every year through to the end of the decade.3 Not all will retire: in fact, we see a growth of over-65-year-olds staying on. One study by Johns Hopkins University estimates that up to 2% of the US workforce belongs to the Silent Generation, born before 1946.4 Even at the very top of corporate leadership, we can see demographic forces at work. While the average age of Fortune 500 CEOs is 59.2, almost half (47.6%) are over 60 and over 5% are over 70. Younger CEOs (under 45) tend to be concentrated in big tech, green energy or young, online businesses. While later retirement across the workforce can be a short-term fix to stop up a talent gap, it also threatens to lead to stasis in keeping a status quo in place at the expense of younger cohorts. Organizations need to ensure older workers are upskilled and able to use new tech tools, while channeling knowledge transfer to younger generations.


There are signs this inter-generational flow is breaking down. Significant numbers of Gen Z are not in the workplace at all. The so-called NEETs (not in education, employment or training) are a growing trend in North America and across Western Europe. According to International Labour Organization data, about a fifth of 15-24-year-olds worldwide are NEETs.5 The numbers are significant: 500,000 in Spain; 3 million in the UK, for example. And this disengagement is leading to levels of stress and anxiety among 18- to 24-year-olds significantly higher than in Millennials at the same age.6


The gender gap at work is another challenge. Much ink has been spilled diagnosing the continued leaching out of female talent from our organizations. Lean In’s 10th Workplace Report (2024) shows that women’s experiences at work have not improved after a decade of gender-focused efforts. Women are far more likely to have their judgment questioned in their area of expertise than men (38% vs. 26%); more likely to be mistaken for someone at a much lower rank (18% vs. 10%), and twice as likely (39% vs. 20%) to be spoken over or interrupted.7 There is a growing generational divide too: younger men are the least committed to gender diversity while younger women are the most. And among senior leaders, while 79% of men think that women are well-represented, that view is shared by only 55% of women.


Providing meaningful economic opportunities for disengaged communities wherever they are is critical for the economic and social health of local economies and the world. When one in six of us will be over 60 in 2030, demographic pressures will require rethinking many of the certainties of the past 100 years.


These gender dynamics are especially visible in the C-suite. While just over 10% of Fortune 500 CEOs are women (double the percentage in 2018), an EY analysis of more than 4,000 public companies worldwide reveals a much less diverse reality. Here only 6% of chief executives are women. The lack of female leaders at the very top can be traced to a leaky pipeline in which women are leaving key roles at two significant points in their careers – in their mid-30s and then again aged 45-55, when promotion to senior management typically occurs.
 

As the shortage of talent in developed economies continues to put pressure on growth, we can’t afford for great swaths of talent to lie idle. Rebecca Robins, author of Five Generations at Work, suggests we need longer-term thinking and investment in the shape and structure of our organizations. “That begins today with being more intentional about how we wire our organizations with ways in which to build more collaborative muscle across roles, disciplines, subject matter and generations. Managers are one of our most powerful enablers of better intergenerational collaboration – if we empower them.”
 

The demographic issues of the global North are in stark contrast to those in other parts of the world. Youth bulges primarily in sub-Saharan Africa, where populations under 25 exceed 60%, will drive immigration and increasingly shape domestic and global political dynamics. Displacement has become a major feature of today’s geopolitical landscape: approximately 184 million people (2.3% of the global population) now live outside their country of citizenship.8

 

Providing meaningful economic opportunities for disengaged communities wherever they are is critical for the economic and social health of local economies and the world. When one in six of us will be over 60 in 2030, demographic pressures will require rethinking many of the certainties of the past 100 years.



Chapter 2:

Shared experiences, growing mistrust

Gen Z are more likely to connect with their peers – and less likely to put stock in authority.



“The core principle of generational theory is that shared experience drives shared behavior and consumer mindset,” says Zak Dychtwald, CEO of Young China Group. “If the experience isn’t shared, then nor will be the behavior.” For significant populations across the world, particularly pre-internet, these generational drivers were siloed by economic context, access to technology and geography.


For example, in the United States while Baby Boomers were witnessing the Vietnam War, moon landings, The Pill and Beatlemania, their peers in China were in the heat of the Cultural Revolution. Moreover, the drivers of generational experience are accelerating, so while the post-war Baby Boomer generation spans 18 years, that drops to 15 for Gen X and Millennials and just 10 for Gen Z. The experiences that define a generation are becoming both more uniform across the world and short-lived, as the pace of change accelerates.

Generational influence graphic

“In Gen Z, there is more convergence than there’s ever been in human history,” says Dychtwald. “The critical factors uniting this generation across geographies are access to the internet, the affordability of smartphones and data. While the internet was the era of information, social media is all about community.”

But just because there is more convergence in the characteristics that mark out Gen Z from previous generations, doesn’t mean there aren’t significant differences. The 2023 EY Gen Z Segmentation Study (via EY.com US) reveals a number of distinct groups or segments among US Gen Z, for example. This cohort may only make up 15% of the US population, but it is already challenging societal norms and changing perceptions.

The critical factors uniting this generation across geographies are access to the internet; the affordability of smartphones and data.

Financial pressures at the forefront for Gen Z

According to the 2023 segmentation study, less than a third (31%) of Gen Z in the United States feel financially secure, describing their present situation as good or excellent.9 Most (69%) rate their financial situation as only fair or worse, with 32% dropping into the poor or very poor categories. This translates into anxiety for the future, with over half (52%) reporting they are very or extremely worried about not having enough money — the highest increase among any of their critical concerns since 2021. No surprise then that research by Experian (2023) shows that more than three-quarters of Millennials and Gen Z report they are somewhat or very dependent on their parents for money.10

Financial pressures aren’t a result of money illiteracy, though. Gen Z is pragmatic (85% have at least some money in savings) while over half (54%) are managing debt or loans.11 According to an analysis of US Bureau of Labor Statistics data by the Washington Post, Gen Z has been disproportionately pummelled by rising prices, higher housing costs, larger student loan balances and more overall debt than the Millennials before them. While both generations came of age in the midst of economic upheaval, Gen Z is spending more on necessities than Millennials did at the same age.12

This is one of several factors driving Gen Z’s passion for earning money on the side. In a UK Visa survey (July 2024), 45% of Gen Z had a side hustle, with over a third (37%) managing more than one, and the overwhelming majority (69%) were doing so to earn extra income.13 “Portfolio careers are the norm now in western economies,” says Danielle Farage, a Gen Z public speaker and consultant, although new research shows this is not true in Asian countries.

But financial security isn’t the only force driving Gen Z’s attitudes to work. This generation has a stronger global mindset – and appetite to travel – than previous generations. Among the 10% of Chinese who own a passport, for example, half belong to Gen Z. The EY organization, employing almost 400,000 people across the world, is seeing many of these shifts in its own workforce. Trent Henry, EY Global Vice Chair, Talent notes, “This generation is significantly more global in their thinking. They join EY to experience the world: not a city.”

Portfolio careers are the norm now in western economies.

Authenticity and transparency build trust
 

Over the past five years, EY longitudinal research and studies such as the Edelman Trust Barometer have shown an ever-weakening level of trust in the establishment. Trust in traditional sources of truth (political leaders, media, scientists) is in general decline, with ever-greater anxiety that they are intentionally misleading us, while peers are increasingly a trusted source. This shift is being driven by Gen Z and the accelerated rate of tech adoption by this generation.14
 

The EY 2021 Gen Z Segmentation study shows big differences between China, Japan and western economies where levels of trust remain high. In the US, for example, over two-thirds (67%) of Gen Z say that most people can’t be trusted. The larger the organization, the more suspicious Gen Z is of its intentions. When asked how much of the time they think they can trust organizations to do what is right, large businesses and federal government scored significantly lower (34%) than smaller entities like state government (41%), local government (47%), and small businesses (71%).

Research by Roberta Katz at Stanford University goes further. Members of Gen Z “don’t necessarily see elders as experts,” she says. “They want to understand why something is done in a certain way. ... Authenticity is about trust. Words and actions need to match.”15
 

Trust in public institutions among Gen Z is particularly low. A US study from Gallup and the Walton Family Foundation (2023) into the attitudes of 12-26-year-olds shows how political institutions, the media and Big Tech are severely mistrusted while science, the military and medicine fare better.16
 

As Edelman’s Gen Z Lab reports, “For Gen Z, social media is the battleground for trust. Among those who were upset by a brand in the last year, Gen Z and Millennials are most likely to have learned about it on social media. Any bad news about a brand is going to spread on social media.”17
 

Transparency is the gateway to trust: for example, the global EY Global Consumer Health Survey found that 73% of consumers would agree to share their medical information electronically but want transparency on how it’s protected and used.18
 

Against this background of low trust in figures of authority, our research shows that many members of Gen Z do trust their workplace leaders. The EY US Gen Z Live Work Play Study reports that 80% of Gen Z feel positively toward their supervisor at work and 71% trust them a lot or completely.19 Gen Z depends on personal experience rather than received opinion in forming their views and is particularly focused on demonstrable authenticity.



Chapter 3:

Making work work: the challenge for employers

Leaders are learning that Gen Z sees work differently from previous generations, and this is influencing the total workforce.



Joanne Su, a Beijing-based senior tax partner and sector lead with Ernst & Young (China) Advisory Limited, reflects on her early career when first entering the workforce in 1994 in Singapore. During her first year seconded to audit, she recalls “lugging heavy box files and taking crowded public buses from the office to client locations.” For younger Millennials, the internet and accelerating digitalization were already changing their early career experiences while today, the seemingly tedious labor that for many characterized their early careers is all but eliminated, in part by generative AI (GenAI). “Technology has the ability to get rid of mundane tasks,” says Henry. “Nothing really compares to GenAI and how it’s freeing up time.”

Gen Z is alive to the potential of AI to cut through low-level tasks. In the EY Gen Z AI Literacy study, 58% of respondents in this global survey expect their AI usage to increase in the coming year, and 51% expect it to increase in their personal life. They rate the top three benefits: saving time on repetitive tasks (58%); analyzing large amounts of data effectively (53%) and reducing human error in important processes (41%). But the same study shows that while optimistic about AI and its potential, Gen Z may not have the skills to access it fully and can overestimate their own skill levels.20

“It’s dangerous to make presumptions about GenAI skills based on age,” says Henry. “Some of the best use cases we have on how GenAI is being used across the EY organization actually come from our oldest employees.” Encouraging self-directed skills training and a curious mindset for the whole workforce is essential in the race to keep pace.

Having a mission driving the work I’m doing really matters.

In spite of widespread acknowledgment of the productivity gains of GenAI in the workplace, many employers struggle to keep their tech tools updated: clunky old methods of recording time, sharing documents or conducting video calls do little to engage a generation used to the easy interface of TikTok. “Employers don’t think about the impression they give when they use these outdated tools,” argues Farage.21 The larger the organization, often the more complex is its tech architecture. “The lack of agility in approaching change can be frustrating,” acknowledges Grace Kilroy, a 25-year-old EY Forensics consultant working in Boston. “Even when you can see something is inefficient, there are so many layers of approval and so much complexity, you can’t initiate change.”

Job security redefined

When Su first entered the workplace 30 years ago, she envisioned her career as an “iron rice bowl” – a symbol of job security and stability. “This was at a time when the Asian Financial Crisis was bubbling beneath the surface.” That is echoed by US-based 27-year-old audit senior Kwame Nkrumah-Ababio, Ernst & Young LLP, who says “Job security is huge for me. I want to know, ‘Is this firm going to weather significant storms in the economy?’” This year’s Universum study polling university students globally underlines the same point: secure employment is ranked third (up three points on 2023) by IT students and fifth for engineers,22 as the roaring job market of the aftermath of the pandemic begins to cool. The Big Stay is replacing the Great Resignation – 3 million US workers quit their jobs in January 2024 (US Bureau of Labor Statistics), 30% down from a peak quit rate in January 2022.23

But the importance of job security doesn’t mean employers can assume their young talent is glued to their desks. In the latest EY 2024 Work Reimagined Survey of over 17,000 employees in 23 countries, 38% of employees say they’re likely to quit their jobs in the next year, a 4-percentage-point increase on last year, rising to 52% of those in the energy and natural resources industry. “Talent churn, once a gold standard measure of organizational health, is no longer relevant. Today’s top employers need, instead, to manage talent flow and focus on providing a rich and promotable experience for their people while they are with them,” says Roselyn Feinsod, Principal, People Consulting, Ernst & Young LLP. While less than a quarter (23%) of Baby Boomers are likely to quit their jobs in the coming year, that rises to 40% of Millennials. In a recent EY US Live Work Play Study of 3,000 members of Gen Z, over half (52%) of Gen Z respondents say the idea of losing their job doesn’t worry them.24 According to the US Bureau of Labor Statistics, the median number of years that employees aged 20-24 stay with their company is 1.2 years, compared to a median 9.8 years for employees aged 55-64.25

This apparent contradiction in Gen Z between the importance of job stability and appetite to quit is the difference between being on the receiving end of change or the driver of it. The cost-of-living crisis in the US and Europe, impacting younger generations disproportionately, has raised levels of financial anxiety. This was revealed in the voting patterns of young Americans in the 2024 presidential elections, in which the impact of inflation and the cost-of-living crisis played a significant role. Early analyses of exit polls showed 56% of first-time voters chose President-elect Donald Trump over 43% who voted for Vice President Kamala Harris. This contrasts with the voting patterns of the young four years ago, when President Biden attracted double the number of votes by first-timers as did Trump (64% vs. 32%).26


What do employees value?
 

Willingness to quit isn’t in itself a negative sign as talent flow becomes the norm, but levels of satisfaction at work are. In the EY 2024 Work Reimagined Survey, only 29% of Gen Z feels highly motivated compared to 41% of Boomers. This is echoed in the 2024 EY US Gen Z Live Work Play Study, which reports that two-thirds of Gen Z (64%) feel partially or completely burned out at work.27


The EY 2024 Work Reimagined Survey notes that younger employees find more value in drawing lines around their work schedule and style. But such burnout-avoidance boundaries can be hard to maintain: While Gen Z respondents ranked paid time off as their first priority, health and wellness tied for second with performance-based incentives. There is an almost unavoidable tension, especially in high-octane, competitive environments. “I’m innately an overachiever,” says Kilroy, “so I feel I always have to be working and doing something. I probably could work less, but I haven’t quite figured out how to do that.”
 

For those moving into more senior roles, managing a healthy work-life balance may become easier. “I rarely work super-long hours,” says Su. “I believe that balancing work with personal interests outside of the office is not only possible but essential for overall well-being. Working smart, rather than just hard, allows me to achieve this balance.”


The importance of collaboration and getting on with your immediate work colleagues is critical for Gen Z. Nkrumah-Ababio says, “I’m passionate about any efforts to bring about community in the workplace; things that bring together a sense of belonging, culture, inclusiveness. I don’t need to be best friends, but I want to be in a very respectful relationship with my colleagues, a collaborative relationship.”


“I think the megatrend of this generation,” says Henry of EY, “is personalization. It’s up to us to deliver what [employees] want individually. And this is just as important to Baby Boomers as it is to Gen Alpha.” This organizational recognition of the needs and unique capabilities of the individual can deliver dividends to the progressive employer but is also visible in consumer choice.
 

The burgeoning “pre-loved” market may partly be driven by climate concerns but is also a manifestation of the Gen Z focus on self-expression. According to a RealReal report, the second-hand luxury market is now worth US$50 billion, driven largely by Gen Z. Pre-loved is financially sound, good for sustainability, and in the case of high-end goods, a way that Gen Z can buy into longer-lasting, higher-quality purchases.28 It’s also a market that thrives on peer recommendations, savvy price comparison, influencers and personal curation. For a generation that is constantly creating and expressing an individual identity, the scarcity that luxury brands offer has high status.
 

As Robins says, “We have greater generational diversity at work, and with it the responsibility to better understand that human difference and turn it to the problems and opportunities that we need to solve for.”29

Purpose drives engagement
 

It’s been said that for Gen Z it’s not about the role, it’s about the goal. All generations are motivated by mission and purpose, but not to the extent we’ve seen in this generation. The US 2023 Gen Z Segmentation Study shows 76% of Gen Z values trying to change the things that are wrong with the world; 36% have participated in a political rally or protest and 50% have used social media to share a message about a cause they support.30


Kilroy says, “having a mission driving the work I’m doing really matters.”
That Gen Z is turned off by many sectors critical to powering the energy transition is not news for those operating in these markets. The Colorado School of Mines, one of a handful of elite global centers of mining education, reports falling enrollments (numbers in 2022 were down about 35% on the previous decade), and this pattern is repeated globally. Mining engineering enrollment in Australia has fallen by an eye-popping 63% since 2014.31

 

This seems to be less of an issue for China’s Gen Z, for whom there’s high status in being employed in government-backed strategic emerging industries powering the EV industry and the computing power for AI. “Energy,” says Dychtwald, “is having a very sexy moment.”


And while “China’s Gen Z is significantly more purpose-driven than their parents, particularly on environmental issues,” this is much less than peers in the US and Europe, Dychtwald says. In China, the empty jobs are in low-level manufacturing: “this generation doesn’t want to make the world’s shirts anymore.”
 

Nkrumah-Ababio is clear that what matters to him is “playing a significant role in my team; being given challenging work that will increase my skillset. I want to make an impact internally and externally.” Henry sees that playing out across the workforce as a whole. “When we ask our people what they would do with more time,” he says, “Gen Z want to spend time counseling others: a demonstration of empathy and care.”

You can’t put tomorrow’s talent into yesterday’s jobs. The next generation of workers expect to be digitally enabled in their roles and to do work they find rewarding – creative, strategic and interesting.

As Stefanie Coleman, Principal, People Consulting, Ernst & Young LLP, puts it in a study of Gen Z’s attitudes to a career in banking, “You can’t put tomorrow’s talent into yesterday’s jobs. The next generation of workers expect to be digitally enabled in their roles and to do work they find rewarding – creative, strategic and interesting.”32

Unleashing generational dynamics to build a meaningful legacy

In the next 20 years, according to demographic forecasts by 55/Redefined, the European workforce (age 15-64) will have shrunk by 25%.33 “In 2006, there were four people of working age (15-64) for each person aged 65 or over; by 2050, this ratio is projected to be just two people,” explains Lyndsey Simpson, CEO.

Harnessing the individual talents of a multi-generational workforce, upskilled and AI-literate, will be essential to close that productivity gap. Leaders need to build new architectures that enable collaboration between the generations. Hierarchical pyramid structures that typically have newest generations at the bottom and oldest generations at the top, won’t deliver in this new environment. Instead, organizations need to rethink their structural models to unleash the power of multi-generational teams, driven by a common purpose and empowered by GenAI tools, to bring together the unique perspectives, experience and skills of each generation.

Meanwhile Gen Z’s influence in the swing toward authenticity, peer communities and personalization impacts employee, consumer and citizen behavior across generations. The signs are already here, and like a postcard from the future, give business leaders a clear set of priorities to position themselves to win in that future.

Actions to take

  • Enhance your employee value proposition (EVP) so it meets the expectations of the contemporary workforce. This means taking a more personalized approach to working methods, benefits and tools.
  • Embed self-directed training as a constant expectation of all generations. Share examples of use cases of GenAI; build prompt libraries; encourage an ever-curious mentality across the workforce.
  • Embrace new technologies: outdated tools do little to engage generations used to agile and intuitive applications.
  • Guard against a “say-do” gap in your organization. Don’t promise what you can’t deliver. Transparency is key to authenticity. Words and actions need to match.
  • Acknowledge the importance of personal choice, whether that is in working practices, consumer options, or interactions with government and public bodies.
  • Identify and remove barriers to adoption. Friction points in an employee’s day, a buyer’s experience, a citizen’s interactions with government bodies – these are potential exit doors. To build loyalty, you must build trust.
  • Ask what your organization will look like in 10 years’ time. Create intentional multi-generational teams or workstreams that cut across vertical hierarchies, where two-way mentoring is enabled and collaboration is encouraged.
  • Provide a rich and promotable experience to motivate new entrants and manage talent flows.
  • Consider establishing a Next Generation Advisory Board, or shadow board, to enable two-way communication between the youngest in your organization and leadership.

Summary 

Our priorities as employees, consumers and citizens are changing at a time of tectonic demographic and technological shift. As a result, many of the certainties of the past are no longer valid models for the future. By rethinking organizational architecture, challenging assumptions and creating new tech-enabled ways to unleash the power of generational dynamics, we can drive new pathways to growth.

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