Compensation is a Top Priority for the COVID-Era Gen Z Job Seeker
Changing priorities for Gen Z since the beginning of the pandemic have caused students to focus on compensation during their job search. In our latest report on what current Gen Z candidates are looking for in the workplace, we found that compensation was a major factor in everything from the overall reasons students would choose a job, to why they would renege on a job offer, to why they’d consider relocating for a job. Here are some of the key insights we uncovered related to compensation and the Gen Z job seeker.
Compensation and benefits is the most important factor for Gen Z candidates when searching for a full-time role
An analysis of RippleMatch survey data compiled from 2019 through 2021 found that compared to pre-pandemic times, Gen Z candidates are now more likely to select “compensation and benefits” as a top factor when applying for jobs. More specifically, college students in Spring 2019 prioritized their career growth, selecting professional development, company culture, and career advancement as the top three factors they considered when looking for a job. Interestingly, compensation and benefits was the least likely factor to be selected during this time.
Students’ priorities changed significantly as COVID-19 disrupted work, education, and life. For the students surveyed during Fall 2020, Spring 2021 and Fall 2021, compensation and benefits was either the most selected or second-most selected factor when considering what was most important during a job search. In a further departure from the pre-pandemic trend, professional development has become one of the least selected factors that Gen Z’ers are considering during the COVID-era job search.
High salaries relative to cost of living are the most important component of compensation and benefits
Looking more closely at a compensation and benefits package, RippleMatch data clearly shows that salary is the main focus for students. In our Fall 2021 survey, 70% of student respondents chose “high salary in relation to cost of living” as one of the most important criteria when evaluating compensation and benefits in a job offer.
Although salary takes the top spot, other types of benefits are still valuable to students. The following factors that students considered most important were affordable healthcare coverage (47% of respondents), 401(k) matching (46% of respondents), and flexible work options (45% of respondents). When extending an offer to your entry-level candidates, it helps to communicate the value of benefits in addition to the base salary, like a 401(k) match or low health insurance premiums, so candidates are better equipped to make an apples-to-apples comparison among different job offers.
Strong compensation can also attract Gen Z candidates for relocation
Likewise, competitive salaries relative to cost of living is a major factor in Gen Z candidates’ willingness to relocate for a role. In our Spring 2021 and Fall 2021 surveys, 75% of students said that an “affordable cost of living in relation to salary” would be important to their enjoyment of living and working in a specific location. Other factors that ranked highly included a great office/workspace (63% of respondents) and easy access to outdoor activities (53% of respondents).
For companies with offices in areas with a lower cost of living, it may be beneficial to highlight the location’s affordability, in addition to offering a competitive salary.
About half of interns returning for a full-time job indicated that higher compensation from another company would be the main reason they would renege on their current offer
So after a Gen Z candidate has accepted a job offer, their search is over, right? Not so fast.
Some students can be lured away by a different offer with higher compensation. In fact, the Gen Z candidates in our report indicated that higher compensation offered by another company would be the main reason for them to renege on a full-time position they accepted after completing an internship with their current company. Among interns who accepted a return offer for a full-time position, 51% indicated that if they were to rescind their acceptance, it would be for a position with a higher salary.
In addition to offering competitive compensation for returning interns, think about ways to keep them engaged with the company before their first official day. You may consider sending out a newsletter, setting up virtual meet-and-greets, or pairing new employees with a mentor to guide them through the onboarding process.
The biggest takeaway is that Gen Z job seekers are prioritizing financial security–specifically in the form of a high salary–during their job search. With the labor market tightening and the Great Resignation still in full swing, it pays to make sure your compensation package is competitive for your entry-level candidates.
For more actionable insights on how to appeal to Gen Z job seekers, download our new report.
