We all know one. You know, the recent (or not so recent) college grad living in his or her parents’ basement. Maybe it’s your cousin with the philosophy degree and $50,000 dollars of debt. Maybe it’s your next-door neighbor’s kid with the MBA who works at the mall. They may be victims of the economy waiting for their big break. Or they may be entrepreneurs in the basement taking charge of their own fate.
Today’s entrepreneurs are more likely to be 18 to 24 year-olds than 35 to 44 year-olds, according to The Global Entrepreneurship Monitor. And why not? Let’s face it. Landing your first real job is tough these days. When you’re lucky to get one interview for every 50 or 100 resumés sent; when you’re competing with professionals who have years of experience to your four-year degree and two summer internships; when your dreams, creativity and exuberance outpace the progress of technology; why not risk it all to make those dreams a reality and put some cash into your pocket? (And hopefully pay off those pesky college loans in the process.)
The Great Recession has hit Generation Y hardest out of all age groups. Last year the national unemployment rate was approximately 10%, but the rate for Gen Yers was closer to 16%. To break the numbers down even more, unemployment for teens hovered around 21%. Approximately 37% of 16 to 29 year-olds were either unemployed or underemployed, according to The Pew Research Center. Those are grim numbers for even the most optimistic graduate.
Thankfully, there is an option. Don’t work… for someone else, that is. Create your own job.
That option is becoming more and more popular among young people, as evidenced by the boom in college entrepreneurship courses. The Kauffman Foundation reported that in 1985 there were about 250 entrepreneurship courses offered at U.S. colleges. Today there are over 5,000. There is even a program at Champlain College in Vermont called BYOBiz, designed specifically for young entrepreneurs. Students are encouraged to bring their start-up businesses to school and learn the skills to be successful.
A bad economy isn’t the only factor in the Gen Y entrepreneurship equation, although it likely has accelerated it. Much of what Gen Yers look for in a long-term work environment can be found as an entrepreneur: flexible hours, meaningful responsibility, creative freedom and the opportunity to follow dreams. These “youngsters” are also best poised to take on the risk of starting a new business. Most have no mortgage, no kids, no valuable 401ks, no hard-earned seniority and no shortage of ideas.
The unbeatable combination comes when you add the ability to live at one’s parents’ house–rent free. Roughly 40% of 2008 grads still live at home, according to a MonsterTRAK survey. The U.S. Census Bureau reported that 65% of all new grads live at home. More than the chance to get on one’s feet, this becomes the opportunity to start a new business.
Next time you are sitting around wondering what that kid next-door could possibly be doing in his parents’ basement, now you know. He might be the next Mark Zuckerberg.
In many ways, it’s symbolic that Generation Z is named after the last letter in the alphabet because their arrival marks the end of clearly defined roles, traditions, and experiences. After all, Gen Z is coming of age on the heels of what has been referred to as the most disruptive decade of the last century. America has become an increasingly changing and complex place.
Members of this generation have undoubtedly been shaped by crisis and disruption. This generation will largely be responsible for confronting the aftermath of the Great Recession, high youth unemployment, the effects of climate change, terrorism, energy sustainability, and more. These dark events have undoubtedly made this generation more cautious and pragmatic, but they have also provided this generation with the inspiration to change the world – and their grit will likely allow them to do it.
Coming of age during disruption means that most Zs will be comfortable being the disruptors. While Millennials tend to be collaborative and innovative, this generation tends to be sincere, reflective, thick-skinned, and self-directed, and will likely approach work in much the same way.
In the era following World War II, Boomers (1946-1964) were born and eventually became the wealthiest, most prosperous generation in history. Raised to aspire for the American Dream, this very large generation moved into positions of power and influence, and served as the workforce majority for 34 years.
With the American Dream alive and well, Boomers had no reason to teach their children, mostly Millennials, about competition. Instead, they taught them to focus on academic achievement and to be team players because if everyone works hard, everyone can win.
Enter Generation X (1965-1981). In contrast Boomers, Xers came of age during a time when change and economic and political uncertainty began to take root. They have lived through four recessions, struggled with debt and economic decline most of their lives, and watched the best educated and accomplished generation of all time (Millennials) graduate during the Great Recession and become the most debt-ridden generation in history.
Gen Xers can be defined by their independence and anti-status quo approach to life, and they have taught their Gen Z children to be competitive, believing only the best can win. They have encouraged their children to be realists, finding something they are good at and aggressively pursuing it.
Xers have raised their Zs with an intense focus on competitiveness -- in academics, sports, and other activities. This approach to parenting has many implications, but one stands out in terms of business: Gen Z is likely to lead.
Millennials in the workplace created and aggressively advocated for collaborative work environments. In fact, their aversion to leadership has been so strong, some Millennials sought out companies that boasted boss-free or team-managed workplaces.
In contrast, Zs have been raised with an individualistic, realistic, and competitive nature. They have been taught the skills to successfully defy the norm. This means we’re going to see the pendulum shift away from collaborative workplaces towards a widespread demand for, and pursuit of, leadership development.
While Millennials have been criticized for their “delayed adulthood”, Gen Z is showing signs of “early adulthood”. Educators and parents often describe this generation as being more serious and contemplative about the world. Zs are thinking about their career paths and exposing themselves to career training at an earlier age than Millennials. It’s probable that some of this early onset of adulthood is caused by parents, who are pressuring their children to be competitive and successful and to avoid the debt that plagued both the Gen Xers and Millennials.
The numbers from our global research found 46% of Gen Z said they know what career to pursue and 51% have taken a class at school focused on their career interests. Forty percent joined an extracurricular program (team, club) based on their career interests.
Zs have been shaped by the aftermath of the Great Recession. They watched Millennials become debt-ridden and are concerned about falling into the same trap. XYZ University’s survey results show 66% of Zs said financial stability is more important than doing work they enjoy, which is the exact opposite of Millennial survey results. Also, 71% of survey-takers have a paying job.
When presented a list of leadership traits, Zs ranked positive and trustworthy the highest. While Millennials and Gen Zs both value trust in a leader, Millennials usually cite collaboration and vision as most important. In other words, Millennials focus on the outcomes leaders inspire, whereas Zs are more likely to consider leaders’ attitudes and personalities. To Z, what leaders encourage others to do isn’t as valuable as how they make them feel.
Both Millennials and Gen Zs place a very high value on feeling challenged and appreciated in the workplace. However, according to our survey results Millennials rank appreciation slightly higher than challenge, whereas Zs rank feeling challenged slightly higher than appreciation.
Time will tell how Zs go down in history, but we know this generation’s influence on history will be unlike any other.
Does your organization have what it takes to engage the next generation? Take this quiz to find out.
Sarah Sladek is CEO of XYZ University. Our generational intelligence can assist you with engaging and retaining young talent and members.
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