Some speculate that due to the recent uptick in Gen Zers’ turnover rates, benefits like pensions are unsuitable for young workers. A recent article published by the Sunlight Policy Center claimed that younger generations seek “mobility” over stability, a claim not only meant to deter employers from investing in younger workers, but also to deny the viability of pensions as a benefit to both employees and employers. While some people disagree that pensions are suitable for this “job-hopping” generation, there is plenty of evidence why pensions are beneficial for this generation of workers and their potential employers.
Gen Zers are defined as those born between 1997 and 2012. While some are still too young to hold jobs, the older range of the generation is entering the workforce. Unfortunately, they are also being painted similarly to Millennials as uninterested in staying in a job long-term. The trend to change jobs while young is not new. According to an article by CNBC, “every generation job hops in their youth in the search for the right career fit.” However, there are plenty of other reasons that today’s younger workers–and their older counterparts–are bouncing around the workforce. When Millennials entered the job market, they faced several financial and economic obstacles, such as the Great Recession. Gen Z is entering the workforce during the Great Resignation–meaning there are more opportunities to pursue while finding their fit.
Student loan debt has “ballooned in the past two decades with Americans holding more than $1.7 trillion in student loan debt.” The situation has not improved for Gen Z, with 74% of survey respondents reporting delaying major financial decisions due to student loan debt, as opposed to 68% of Millennials and 54% of Gen X. With the high cost-of-living and student loans, Gen Zers are constantly seeking opportunities to make higher wages. CNBC also notes that higher wages have become “a growing need as employer pension plans become a thing of the past and workers need to devote more of their incomes to retirement savings.” They also note that according to the Labor Department, “Between 1975 and 2017, pension plans dropped from more than 103,000 to just about 46,700.”
With all these factors coming into play, pensions are exactly what public employers need to combat the changing workforce trends and meet the needs of the younger workers. While Gen Zers are young and still figuring out where they fit in their careers, this is no reason to deem them ineligible for pensions. One of the benefits of pensions is that they are portable, proving that they are suitable for younger workers. Pensions could help incentivize young workers to join the public sector by providing retirement security that private-sector employers fail to offer.
Current workforce trends should not deter employers; instead, they should be looking for ways to combat them. Guaranteeing pensions is an excellent place to start.
