Gen Z and Millennials: All About the Benefits, Not Just the Benjamins

Competition for employees is fierce, but if employers are trying to attract Gen Z to their workforce by focusing on perks like free avocado toast and ping-pong tables, they’re going about it all wrong. A recent study from Lincoln Financial Group (NYSE: LNC) and the Center for Generational Kinetics shows that traditional benefits like retirement plans and insurance are most important for attracting and retaining Gen Z and Millennials1. Benefits open the door The oldest members of Gen Z are 23 years old and are joining Millennials, who are the largest generation in the workforce2, in the working world. Both generations are all about the benefits, not just the Benjamins. Both Millennials and Gen Z rank salary as most influential when making job decisions, but 60% of Gen Z workers say they would accept a 10% lower starting salary in return for a better benefits package, while 65% of Millennials would take a job that paid 10% less but offered much better benefits. “The recession in 2008 was a formative experience for many Millennials and Gen Z-ers. Many either watched their parents face the challenges it created, or they experienced it themselves during their early years in the workforce,” said Jamie Ohl, Executive Vice President, President Retirement Plan Services, Lincoln Financial Group. “These are generations who now focus on what their employer can offer to help them save for retirement and protect their financial future.” Gen Z ranked perks as the least important factor when they’re considering a job, and 62% said the benefits offered by a potential employer are very or extremely influential to their decision to accept a job offer. And 44% of Millennials have turned down a job because it didn’t offer the benefits they wanted. Benefits drive retention Strong benefits packages — including retirement plans and insurance offerings beyond health insurance, such as dental, vision, life, disability, accident and critical illness insurance — don’t just get younger generations in the door. They keep them there. Many Gen Z-ers are just now taking their first full-time positions, but 91% say that being offered a great employee benefits package would make them work longer at that first gig. After salary (73%), Millennials said that benefits most influence keeping them at their job (51%), and 57% have stayed at a job longer than they wanted to — even though they didn't like the job — because the job offered good benefits. “Gen Z and Millennials aren’t just thinking about the now — they’re thinking about tomorrow,” said Eric Reisenwitz, SVP and Chief Operating Officer, Group Protection, Lincoln Financial Group. “Benefits have to meet the needs people have today, but also what they are looking for three to five years from now.” Millennials say the benefits that will be more important to them in three to five years are a retirement savings plan, long-term disability insurance and life insurance. “These generations are focused on the substantive offerings an employer provides,” said Reisenwitz. “They are looking for employers that will help them achieve their financial goals, and protect their financial futures.”