When recruiting, training, and optimizing Gen Z, business as usual isn’t going to cut it, and with Gen Z now matching (and soon to exceed) Baby Boomers as a proportion of the total workforce, employers would be wise to adjust accordingly.

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It is no secret that the competition for talent on the labor market has been historically tight for a long time now, with average unemployment nationwide below 4% for the past 2 years straight.

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These conditions have had wide-ranging impacts across industries throughout the labor market, including upward wage pressure that resulted in a 4.5% increase in average hourly pay over the last year, which outpaced the 3.4% increase in inflation that accumulated over 2023. 

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While there was some softening in the labor market during the summer and early fall, the last few months have once again seen huge additions of new jobs being added to US company payrolls, despite the Federal Reserve’s nearly two-year-long interest rate hiking campaign designed to cool the demand for labor.

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With the Fed signaling that those interest rates have hit their near-term peak and will likely begin coming down soon, however, demand for labor may well outpace the labor supply for the foreseeable future absent some kind of disruptive event.

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As Gen Z makes up an increasingly large share of not only the labor supply, but also the supply chain, and customer base, how can employers transition their business practices to better accommodate and capture value as business norms, sensibilities, and expectations change with the times?

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Gen Z Job Applicant Perception Problem - By The Numbers

A recent survey from ResumeBuilder.com highlighted by BizWomen illuminates some of the main issues surrounding the entrance of Gen Z into the workforce, and how best to address them. 

• Hiring Managers Prefer Older Workers: Nearly 1 out of 3 hiring managers (31%) report having a preference for hiring older workers over Gen Z applicants, which of course is an ultimately unsustainable strategy. 

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A closer look at some of  the underlying reasons why almost one-third of respondent hiring managers are inclined to steer clear of Gen Z workers, however, reveals that differences of perception are often a source of conflict and misunderstanding. 

The most common reasons listed for why hiring managers rejected Gen Z applicants were:

• Entitled Attitude: 41% of respondents claimed Gen Z interviewees acted too entitled;
• Poor Communication: 39% of respondents claimed Gen Z interviewees were poor communicators;
• Unpreparedness: 36% of respondents claimed Gen Z interviewees were unprepared; and
• Unrealistic Compensation Expectations: and 42% of respondents claimed Gen Z interviewees were asking for too much money. 

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When analyzing this list of top hiring manager complaints with Gen Z job interviewees, the lack of objectivity that characterizes most of the issues is hard to overlook, especially given how so many aspects of assessing entitlement, communication, and preparation are quite subjective in nature. 

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For example, many interviewers complained that Gen Z applicants were not dressed appropriately, and/or they failed to make appropriate eye-contact, and or they used inappropriate language. 

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Rooting all of these perceptions is the idea of what is and what is not appropriate in a given setting, which are understandings that are very much in flux generationally. 

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Similarly, what some hiring managers may perceive as entitlement may reflect different career-related priorities and/or the different labor market/social conditions that each generation may have found upon their entrance into the workforce

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Even the reasonableness of one’s compensation expectations, while more objective given market ranges, may be reflective of an underlying generational divide in light of the fact that dollars today earned by Gen Z workers have 86% less purchasing power than the wages brought home by Boomers at the same age. 

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Ultimately, company leadership will have to set the parameters and define what is appropriate when it comes to applicant and employee behavior, but the narrower that those parameters get relative to the broader understanding of what is and isn’t appropriate among the workforce and society in general, the harder it will be for companies to continue meeting their talent needs from an increasingly restricted labor pool. 

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You can read more about Gen Z in the workforce here.

Once again, US companies outperformed expectations last month, adding 353 thousand net jobs across their collective payrolls. 

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At the same time, the unemployment rate remained at 3.7% for the third consecutive month,  which marks 2 full years now that the national unemployment rate has been below 4%.

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That said, the report wasn’t exclusively good news, with the number of people who have been unemployed for more than 27 weeks rising by about 30 thousand to approximately 1.28 million last month, and that figure has grown by 200 thousand over the course of the last year, which is an increase of almost 20% year over year.

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There has also been a noteworthy uptick in the number of people who want a job but are not currently counted as unemployed because they weren’t actively seeking or were unable to take a job over the prior 4 weeks. That figure rose by about 120 thousand over the last month, climbing to about 5.8 million, which is up by about 475 thousand over the last 12 months.

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Still, the total number of people who want a job but don’t have one for whatever reason makes up less than 7% of the prospective labor force, which remains historically low, and the labor force participation rate continues to hold steady at 62.5%.

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With regard to job growth, professional and business services saw the largest increase in new payroll entries at plus 74 thousand, followed closely by the healthcare industry at 70 thousand. 

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Retail employment also had a great month, adding 45 thousand jobs, while government, social assistance, and manufacturing jobs grew by an average of about 30 thousand jobs per industry. The information sector also added about 15 thousand new jobs.

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There was little change in the net payroll figures across the construction, wholesale, financial activities, leisure and hospitality, and transportation and warehousing industries, although there was a net loss of about 5 thousand mining, quarrying, oil and gas extraction jobs.

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The average workweek fell another two-tenths of an hour to 34.1, which is down a half hour in total over the last 12 months, while average hourly earnings rose 19 cents to $34.55.

Mployer Advisor’s Take

On top of the additional 350 plus thousand new jobs added last month, this latest economic report also upwardly revised the job figures from the prior two months by more than 30%, accounting for an additional 126 thousand new jobs that had gone previously unreported.

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Further, a closer look at the very stable 3.7% unemployment rate reveals that the true figure is closer to 3.66% - down from 3.74% the month before, and predictions of imminent recession are far more scarce and less severe than they were at the beginning of each of the past 2 years.

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For the time being at least, the economy and the labor market continue humming along and the prospect for continued stability appears more likely than a near-term downturn. 

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Perhaps what has changed the most over the last few months is that people are finally taking greater note of these favorable economic conditions and are feeling somewhat more optimistic that these conditions will remain favorable than they had been in the past.

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As always, these positive economic trends are always vulnerable to unknown factors ranging from international conflict to viral resurgence, but as has been the case for many months now, the trends look good for the time being at least. 

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Eager for more exclusive content? Check out the Mployer Advisor blog here.

Employee benefits have become not only an increasingly large component of total compensation packages, but they have also in many ways come to symbolize the amount of interest that an employer maintains in the well-being and productive longevity of their workers.

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As a result, employee benefits packages in the eyes of many employees, both current and prospective, reflect the degree of reciprocity they may be able to reasonable expect for their loyalty and dedication, which in turn can have major impacts on everything from recruitment and retention to productivity.

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As the employee benefits landscape continues to evolve right alongside work-life balance shifts and reexamined employer/employee relationships, this recent piece from BenefitsPro highlights 5 of the top trends that companies competing for top talent are leaning into in order to gain an edge over the rest of the field.

Top Focal Points In Employee Benefits 2024

• More Choices: One of the best ways to ensure that benefits packages can be tailored to the needs of your employees is to offer a wide array of less common voluntary benefits offerings, such as financial services, tax preparation assistance, and stress management counseling in addition to supplemental insurance options like critical illness, cancer, accident, and identity theft coverage. 
• Education Debt: About 40 million Americans are currently saddled with outstanding federal student loans, meanwhile payments and interest accrual having resumed in the wake of the three-year-long pandemic pause. For employers that are unable to offer loan repayment assistance or contribution matching similar to retirement account contributions, employers can still offer meaningful assistance to their employees by directing them toward some of the resources and opportunities made available from the Save Plan - including payment reductions from 10% of discretionary income to 5% in some cases, loan forgiveness after 10 years of payments for debts that were less than $12 thousand when originated, and the potential for reduced interest accrual for enrolled borrowers.
• Housing: Employer-Assisted Housing (EAH) programs are helping bridge the gap in the market between workers who wish to buy homes and those that are financially capable of doing so. EAH programs can enable employees to set aside a portion of their income pre-tax to be used as a downpayment. These kinds of programs can also include services that assist employees in qualifying for rental units and downpayment contributions, as well. 
• Family: The pandemic caused a lot of people to reevaluate their work-life balance, resulting in a large number of workers who now prioritize their family life and well-being perhaps to a greater degree than they may have in the past. Not every family has the same needs, however, which makes it vital that offerings are as diverse as your employee pool. Fertility benefits can be coupled with adoption support and day care offerings can be coupled with senior care and pet care services, for example.
• Retirement: Though retirement planning and account contributions are not equally prioritized by all employees, with older workers unsurprisingly much more concerned with retirement than younger workers, complaints about retirement benefits across generations seem to pretty consistently stem from disappointment that employer contributions aren’t larger. Employers that are unable to raise the dollar amount of their contribution matching program, however, can still provide significant additional value simply by providing additional resources that can help employees better navigate some of the advantages that accompany the SECURE Act  2.0, which can help employees both better plan for retirement and better financially manage emergencies when they arise during pre-retirement years. 

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You can read more about this topic and employee benefits on the rise in 2024 here.

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‍Each month, Mployer Advisor collects and presents some of the most relevant and most pressing recent changes in law, compliance, and policy in areas related to employee benefits, health care, and human resources. 

Employee vs. Independent Contractor Classification

Beginning on March 11, 2024, the Department of Labor will effectively revert back to ‘the economic reality’ test for determining whether a given worker should be classified as an employee or as an independent contractor.

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The economic reality test will take into account the following 6 factors when evaluating a workers employment status and classification:

• Whether it is possible for the worker to either profit or lose money as a result of the arrangement;
• What investments have the employer and worker each made toward completing the work;
• Is the work relationship a more permanent arrangement or more temporary;
• How much control does the employer exert over the worker’s process;
• How crucial is the worker’s output to the employer’s business; and
• The levels of skill and initiative possessed by the worker.

You can find more information from the DOL on determining employee and contractor status here.

Employers Rejecting Job Applicants Due to Credit Reports Must Provide Credit Rating Agency Info 

Beginning March 20, 2024 enforcement begins for Consumer Protection Bureau’s rule requiring Employers that reject job applicants due to information obtained through a credit report to provide the rejected applicant with information about the credit reporting agency from which the report was obtained, including name, address, and telephone number.

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This rule, which went into effect in April of 2023, is an update to 2018’s Summary of Your Rights Under The Fair Credit Reporting Act.

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You can read more about the new rule, its impact, and enforcement here. 

New Safety Reporting Regulations

There are a number of changes to Federal Law including updated mileage reimbursement rates and workplace safety standards that took effect when the new year began, January 1st, 2024. 

• IRS Mileage Reimbursement Rate Increase: The Internal Revenue Service raised the rate at which miles driven for business purposes are reimbursed up to $0.67 per mile for 2024, which is an increase of 1 and a half cents per mile over the 2023 mileage reimbursement rate of $0.65. As a reminder, this reimbursement rate is a recommendation and sets a generalized standard but is not required or enforceable.
• OSHA Electronic Submission Reporting Requirements: In addition to submitting form 300A, firms that have at least 100 employees and operate in industries that have been designated as hazardous must electronically submit data from their injury and illness logs. According to the general submission timeline, submissions regarding incidents that occurred during the calendar year of 2023 will be due on March 2, 2024.
• Minimum Wage Increase for Federal Contractors: For federal contracts that fall under Executive Order 13658, which were entered into on or after January 1, 2015, employees must now be paid a minimum of $12.90 per hour for wage workers and $9.05 per hour for tipped workers. Minimum wage for employees servicing contracts that fall under Executive Order 14026, which were entered into on or after January 30, 2022, is now set at $17.20 per hour for all employees, and contractors are no longer permitted to pay a lower rate to tipped workers under contracts governed by this Order. You can click here for an additional resource from the Department of Labor to help differentiate and distinguish between federal contracts that fall under Executive Order 13658 and Executive Order 14026.

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You can find additional information about the new IRS mileage reimbursement rate changes, OSHA electronic submission requirements, and minimum wage increases for federal contractors, including frequently asked questions about Executive Order 13658 and Executive Order 14026, in the embedded links.

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Secure Act 2.0 Takes Effect January 1, 2024

The Secure Act 2.0, which was signed into law in the closing days of 2022 and will take effect at the beginning of the new year, ushers in some sweeping changes to retirement planning and savings administration in the US, including: 

• Mandatory 401k Enrollment: Most companies with more than 10 employees that have been in operation for at least 3 years will be required to automatically enroll employees into their 401k plan with between 3% and 10% automatic contributions. There’s also a tax credit available for many companies to cover the additional administrative burden of automatic enrollment.
• Starter 401ks With No Employer Match Requirement: The expense of matching employee contributions has deprived many employees over the years of the benefits of having a 401k account even in the absence of matching employer contributions, which should no longer be an issue under the new law. 
• Increased Catch-up Contributions: The amount of annual contributions that employees can begin putting into their 401ks at age 50 is being increased by 50% from $6,500 to $10,000, and that limit is now indexed to inflation to ensure it keeps up with the cost of living.
• Increased Emergency Savings Account Flexibility: Despite more than 4 in 10 US workers expressing a desire to be automatically enrolled in an emergency savings account program through their employer, only about 1 in 10 employers offered such an opportunity as of 2022. The Secure Act increases the flexibility and ease with which employers can now offer such account via withholding as much as 3% of opting-in employees’ paychecks up to $2,500 to be placed into said emergency savings accounts, from which employees can then withdraw their money untaxed up to four times a year with no penalties whatsoever. 

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My mom was an airline stewardess in the glory days of PanAm. People would dress up to go on the plane. That is a distant memory if you have flown in the past two decades. The rise of hybrid work has been well-documented both here and elsewhere, but often less publicized is the massive effect that the proliferation of off-site work arrangements has had on work attire expectations, taking an already occurring evolutionary trend and massively accelerating it.

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Where a worker is conducting their work can make a substantial difference in how they dress, of course, and it is no surprise that nearly 4 out of 5 employees (79%) who work hybrid schedules dress differently depending on their work location - whether that be at home, on-site, or in a third place.

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Perhaps more interesting, however, is how on-site and in-office dress codes are becoming increasingly more casual at the same time. For example, the most recent polling data from Gallup indicates that only about 3% of US workers wear a suit to work - down 4% from the 7% of respondents who did so in 2019. 

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Another survey indicates that the proportion of offices with formal dress codes in the US has fallen from 1.2% to just 0.2% over the last 4 years.

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What was once a widely observed professional standard across an array of industries has now become an outlier, and the trend lines for business casual wear in the workplace, while not nearly as drastic, may ultimately lead to a similar fate. 

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This recent piece from BizWomen takes a broad look at some of those trends that are emerging with regard to workplace attire:

Work Attire By The Numbers

• Current Work Attire Breakdown: As of the most recent data from Gallup, about 41% of US workers currently dress in business casual attire, while about 31% wear casual clothing, and 23% wear uniforms on the job. 
• Employee Perspective: Nearly 3 out of 4 employees believe flexibility in dress code expectations is vital, which includes just about the entire respondent pool if you exclude employees who wear uniforms at work. Further, in a separate poll almost 1 in 4 workers claimed that they would be willing to accept a cut in salary or wages in exchange for the loosening of attire-related restrictions and a more informal dress code generally.
• Talent Attraction: There was a 20% swing in the number of job postings that mentioned business-casual work attire between 2019 and 2022. In January of 2019, about 40% of job postings referenced business-casual attire, but only 3 years later in January of 2022, just under 20% of job listings did so. Over that same time period, the percentage of job postings that referenced casual attire climbed from about 60% to nearly 80%. 
• Dress Code Evolution By Gender: 85% of men respondents reported noticing a casual evolution in their professional in-office work attire while 77% of women said the same.
• Back-to-Office Perk: Nearly a quarter of respondents (24%) claimed that their resistance to spending more time in the office would be reduced significantly if they could wear the clothing of their choosing within reason.

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You can read more about this topic and find additional insight on the subject from industry professionals here.

In the digital age, where transparency and corporate reputation are increasingly scrutinized, the significance of an employer's Glassdoor rating has become a topic of much debate. Glassdoor, a platform where current and former employees anonymously review companies, has transformed into a crucial tool for job seekers and a barometer for companies' workplace cultures. But does this rating genuinely matter, especially in the context of hiring new people and retaining current employees? Moreover, how does it compare with other metrics like the 'Best Places to Work' awards in the United States, which, intriguingly, have shown a strong correlation with organizational success?

Firstly, Glassdoor ratings play a pivotal role in shaping a company's image in the eyes of potential hires. In an era where candidates often research a company as rigorously as their potential employers scrutinize them, a low Glassdoor rating can be a red flag. It can deter top talent from applying, as these ratings are perceived as reflections of employee satisfaction, management style, and company culture. Conversely, a high rating can enhance an employer's brand, making it more attractive in a competitive job market. This aspect is particularly crucial in industries where talent is scarce and highly sought after.

However, it's essential to approach these ratings with a nuanced understanding. They can be subject to bias, as disgruntled employees might be more inclined to leave reviews than satisfied ones. Therefore, while these ratings offer valuable insights, they should be considered alongside other factors like company achievements, industry reputation, and direct feedback from current employees.

Regarding employee retention, Glassdoor ratings can serve as a useful barometer for internal health. A sudden drop in ratings can be an early warning sign of underlying issues, such as poor management practices or declining job satisfaction. Proactive companies monitor these ratings not just for external branding but also to gauge internal sentiment and address potential problems before they escalate.

Interestingly, when it comes to predicting a company's success, the 'Best Places to Work' awards in the United States offer a surprisingly accurate metric. These awards, determined through comprehensive employee surveys and an audit of company policies and practices, provide a more holistic view of an organization. They consider factors like employee engagement, job satisfaction, benefits, and work-life balance, which are crucial for long-term organizational success.

Companies that consistently rank high in these awards often demonstrate strong financial performance, lower employee turnover, and higher levels of innovation. This correlation suggests that a positive work environment is not just beneficial for employee morale but is also a critical driver of business success. For potential employees, these awards offer a reliable insight into a company's culture and values, often more so than standalone reviews on platforms like Glassdoor.

In conclusion, while an employer's Glassdoor rating is an important metric in the modern job market, influencing both hiring and retention, it should be viewed in context and supplemented with other information. The 'Best Places to Work' awards, on the other hand, provide a more comprehensive overview of a company's workplace environment and are a surprisingly effective predictor of organizational success. As the corporate world evolves, these tools and metrics will continue to shape the landscape of employment, emphasizing the growing importance of transparency and employee satisfaction in the quest for business excellence.

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