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What the needs of Gen Z mean for HR controlling

The millennials have now almost arrived in professional life, and the next generation is already waiting in the wings: Gen Z.

You hear a lot about those born after 1997 – aspiring to be influencers or YouTubers, no motivation and generally so spoilt that there’s nothing to do with anyone. But what expectations does Gen Z really have of the world of work and employers? A study by Zenjob from 2022 gets to the bottom of this question.

Changing values and desires

Gen Z is in a balancing act between security and self-determination. Requirements that used to be clearly defined can no longer be generalised. Young employees need to be seen by companies more as individuals with their own needs than perhaps their predecessors. On the one hand, this is a challenge for managers, but the employer itself must also adapt its structures and planning accordingly.

Work-life balance: flexibility or structure?

Gen Z defines a completely new understanding of work-life balance. While for many it means a strict separation between work and private life, young employees are not opposed to work-life blending. In concrete terms, this means that Gen Z also likes to separate work and private life, but has nothing against being available on days off.

This also has to do with the urge for flexible time management. 67% of those surveyed consider it important to find their own working rhythm. Nevertheless, opinions are divided when the question of fixed working hours becomes more concrete. Flexibility may be nice, but it carries risks, especially for career starters, due to the high degree of self-organisation and time management.

In contrast to workaholics from Gen Y, young people no longer strive too hard for a career. “Work doesn’t define us, it enriches our lives.” The job becomes the security in a fulfilling life and does not fulfil life. It is therefore not surprising that 68% of respondents do not want to mix their professional and private lives.

[…] in the competition for talent, what counts in the end is the overall package, which in addition to soft factors and “good salary” also includes working time models and holidays. – Hanns-Dirk Brinkmann, CEO Software4You Planungssysteme GmbH

Money does(n’t) play a role

Even if togetherness and work-life balance are important to the younger generation, the most important point is still a good salary. Particularly in times of inflation and crises, even career starters realise that traditional benefits such as fruit baskets and company parties do not finance a flat. The trend is moving towards applications to employees. The external image of companies is becoming increasingly important, and salary is the number one issue.

It is therefore hardly surprising that “Honesty and open communication” is in second place. A thing said is not immediately done. Gen Z wants to know where it stands and what to expect. Meanwhile, flat hierarchies, company celebrations and diversity in the workforce are the order of the day.

Favourite: The medium-sized company

All of the above unites one type of company in particular: the classic SME. Familiar interaction, structure and meeting at eye level. But above all: safety!

For this reason, start-ups have slipped far down the rankings. Waves of redundancies and cost-cutting measures are damaging its appeal, with the result that only 13% (10% less than in the previous year) are still interested in working in a start-up.

Despite all this, there is also a great deal of interest in self-employment – 21% of those surveyed could imagine going down this route. Only 17% of young employees see themselves in large corporations.

What the needs of Gen Z mean for HR controlling

According to the Zen study, the most important characteristic of an employer for Gen Z is “good salary”. However, this wish should not be interpreted too one-dimensionally; in the competition for talent, what counts in the end is the overall package, which in addition to soft factors and “good salary” also includes working time models and vacation.

In order to meet the needs of Gen Z, employers must therefore make more flexible offers in the areas of working hours, vacation and remuneration. In the future, we will therefore see an (even) higher degree of individuality and therefore also complexity in personnel cost planning and further HR controlling. As companies’ offerings will differ and become more individualized, a flexible and quickly adaptable system for planning and HR controlling, such as 4PLAN HR, will be needed even more than today.

Key figures in relation to Gen Z

Furthermore, key figures must be redefined to ensure comparability. In a time when every employee had 30 days of vacation per year (part-time analogous), this aspect could be ignored when determining FTE or effort per FTE. As soon as employees can choose whether they want 30 or 40 days’ vacation, this must be taken into account in the remuneration planning and FTE calculation. This also applies to other offers such as sabatticals, alternative remuneration components, etc.

Conclusion

We don’t have to reinvent HR controlling for Gen Z, but we do have to make it more flexible and adapt it. The increasing importance of soft factors (diversity in the workforce, social values, sustainable action) will lead to these being incorporated into HR controlling. HR must set appropriate targets, implement measures and monitor their success.

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