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From recruiting to office culture, it’s no secret that millennials have dominated conversations about the workplace. Just when we thought we had begun to understand millennials, a new cohort entered the workforce: Generation Z. Gen Z, consisting of those born between 1995 and 2015, is the single largest generation in the U.S., accounting for nearly 61 million people and 26% of the current U.S. population. It’s time for us, as employers, to turn our attention to them and begin preparing for this incoming workforce. Let’s take a look at how Gen Z will shake things up.
Gen Z: What’s Different?
When millennials entered the workforce, they fundamentally changed the future of work. Unlike past generations, they don’t stay with an employer longer than a few years, aren’t afraid to ask for what they want from their careers and they want to feel a connection with their employer that goes beyond a paycheck.
As a result, voluntary employee benefits — i.e., any benefits outside of and complementary to core medical, dental and vision insurance, including student loan repayment assistance, supplementary health insurance and pet insurance — became the de facto way to cater to those employees. Over 90% of millennials surveyed reported that they would prefer additional benefits over a pay raise.
Not to be underestimated, Gen Z is next in line and poised to further disrupt the future of work. From communication to how they make decisions, they are comfortable with using technology in every avenue of their lives. Voluntary benefits will become even more important to Gen Z as they seek out employers that are complementary to and support their lifestyles.
Employers Must Brace Themselves For A New Challenge: Personalization
Knowing what we do about Gen Z and the motivations behind how they approach their careers, employers must be ready to yet again make fundamental changes to the way they approach benefit offerings to attract and retain Gen Z employees. With Gen Zers more likely than their millennial counterparts to hop from one job to the next, employers must be prepared to provide holistic work experiences and engage with their Gen Z employees to keep them happy. I recommend discussing with potential new hires the types of benefits they are looking for because this will bridge the gap between you (the decision-maker) and them (the employee) and give you the chance to be culturally competitive.
The problem is that, rather than facilitating employee benefits to meet the unique needs of their employees, employers (and by extension, HR teams) have become gatekeepers. Because employers are typically risk-averse when it comes to employee benefits, they usually only provide benefits offerings they are familiar with, such as core benefits like medical or dental insurance, and only from providers they have known for ages — typically large, national brands. This outdated approach to benefits administration limits the employee’s ability to pick and choose the benefits that will best support their lives and discounts how savvy and sophisticated employees are. I recommend giving new employees the opportunity to choose their own voluntary benefit package, much like they choose their own core benefits package. This gives each employee the opportunity to make decisions based on what’s best for their lifestyles. Take the risk here; personalization truly is the future, and by laying the groundwork now, your company will retain happier employees.
Another new challenge that began with millennials is also poised to grow with the newest generation. Millennials are much more open about money; over half of American millennials reported discussing their wages with friends and/or coworkers. Many Gen Zers who are considering job offers will discuss compensation and benefits with those around them. If friends or family have better benefits or are offered voluntary benefit packages, it may be a deterrent to your potential employee to accept your job offer. Discuss the benefit process with a potential employee openly and honestly. Remember that, for many Gen Zers, this may be their first job where benefits are offered. Allow them the opportunity to understand the process and what your company can offer them.
Employers must also trust Gen Zers to make choices for themselves when it comes to benefits offerings. They are used to being presented with an over-abundance of options in nearly every facet of their lives, from picking the next Netflix show to buying the best food for their dog on Amazon. And studies show that Gen Z is not brand loyal; only 36% of Gen Z respondents surveyed by IBM felt a strong connection to brands. Instead, they prefer to have freedom of choice in vetting myriad options and making the right decisions for themselves. A recent report by the Center for Generational Kinetics found that “over 50% of Gen Z reads at least three ratings or reviews before making a first-time purchase.”
Employers should approach benefits with a focus on offering a wide variety of voluntary benefits that supplement core benefits and present them in such a way that employees can easily review, vet and make their own decisions. By putting the power of choice in employees’ hands, they are happier and it frees up time for HR teams to be dedicated to other tasks and further improve employee culture.
Gen Z will challenge norms and demand more from their employers than millennials did. I believe a major shake-up is on the horizon as this generation enters the workplace and makes known their expectations and desires. Employers must listen and encourage outside-the-box thinking from their HR teams to ensure their workplace, office culture and benefits offerings match up with what Gen Zers are looking for and start putting in place the groundwork if they want to stay competitive in the fierce battle for top talent.
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“How To Offer Benefits To Gen Z Employees” | Written By: Neil Vaswani, CommunityVoice / Forbes – Entrepreneurs
November 19, 2019 at 08:02AM
VIEW ARTICLE ON Forbes – Entrepreneurs >> https://www.forbes.com/sites/forbesbusinesscouncil/2019/11/19/how-to-offer-benefits-to-gen-z-employees/