In today’s competitive job market, businesses of all sizes face significant challenges in attracting and retaining top talent. A recent ManpowerGroup report highlights the issue: 71% of companies with fewer than 10 employees and 74% of those with greater than 5,000 employees report recruitment difficulties. Companies employing 1,000 to 4,999 employees face the steepest hurdle with 77% identifying recruitment as a critical challenge.
While toxic work environments, poor leadership, or dissatisfaction with managers often drive employees to leave their roles, more individuals are seeking purpose-driven work aligned with their values. This trend is particularly important for Gen-Z who are expected to overtake baby boomers in the workforce by this year.
A recent study conducted by Cone Communications underscores this point: 81% of Gen Z believes they can have an impact on social and environmental issues, and they expect their employers to share this commitment. Furthermore, the study finds that Gen Z is also willing to make decisions based on their ethics, such as declining assignments with negative environmental impacts, non-inclusive practices, or projects that conflict with their values around mental health and work-life balance.
Why is this generation so socially conscious?
Gen Z’s heightened awareness stems from two key factors. First, they have grown up with unprecedented access to global issues through social media, giving them a front-row seat to societal challenges. Second, as socially conscious consumers, they actively choose to engage with companies making a positive impact.
The Cone Communications study also reveals that:
- Ninety-eight percent of Gen Z employees prefer to buy from companies addressing social and environmental issues.
- Ninety-two percent would switch to brands associated with a good cause, assuming similar price and quality.
What Does This Mean for Employers?
Gen Z employees have strong expectations about how businesses should address social impact. Additional research provides further insight into their mindset: 75% of Gen Z and Millennials say an organization’s societal impact is an important factor when considering employment according to the following research studies:
- When employees say they feel good about the ways their company contributes to the community, they are 60% more likely to report high levels of well-being according to research by Great Place To Work.
- The Gen Z Activism Survey report conducted by the United Way found that 32% of all Gen Zers and 40% of Gen Z college students are regularly involved in activism or volunteer work.
- Seventy-four percent of Gen Z employees are more likely to buy from companies that are committed to social responsibility.
- Ninety-one percent of consumers are likely to switch to a brand supporting a good cause, showcasing the potential for increased customer loyalty according to market research company Kadence International.
- According to the DeVere Group, a survey of Millennial investors around the world found that some 77% of them say that environmental, social, and governance concerns are their top priority when considering investment opportunities.
Given these insights, having a companywide commitment to social impact has become a competitive advantage for businesses of all sizes. Social impact does not just benefit communities—it strengthens company culture, boosts employee morale, and enhances productivity. Employees who take pride in their company’s social contributions are more engaged and motivated at work, leading to higher retention rates.
Building a Sustainable Social Impact Program
To build a meaningful and sustainable social impact program companies can partner with nonprofit organizations on projects that align with their values. These partnerships can take many forms, including providing resources such as mentors and volunteers or contributing a portion of the company’s profits to local organizations.
Additionally, businesses can empower employees to get involved by offering paid time off to volunteer at the non-profit of their choice. This approach is effective for both large enterprises and small businesses with limited donation budgets. At UKG our Global Volunteer Time-Off Policy encourages employees to engage in meaningful volunteerism by offering all U Krewers at least two paid days off annually to volunteer in their communities. UKG and its customers can log their volunteer hours in UKG Pro Workforce Management or UKG Ready to help measure the company’s collective impact, drive progress toward annual goals, and continually increase their volunteer contributions.
It is clear that Gen Z employees expect their employers to embrace social impact. According to the Deloitte 2024 Volunteerism Survey 90 percent of respondents said their participation in workplace volunteer activities led to them participating in additional, independent volunteering activities, whether through the same organization or with other organizations within their community.
By integrating purpose-driven initiatives into their operations, businesses can attract and retain top talent, foster a positive work environment, and enhance their reputation – all while making a meaningful difference in the communities they serve. Importantly, companies committed to social impact can become a force multiplier for good.