When it comes to workplace fulfilment, it’s common to discuss employee happiness and engagement as one and the same. Yet, although they are connected, the two states of being happy and engaged are different.
Traditional definitions of happiness focus on moments of joy, satisfaction, and wellbeing. While these feelings are undoubtedly valuable, they tend to be short-lived and vulnerable to constant change. On the other hand, engagement represents a steadier, more enduring mindset – a period of focused commitment rather than a brief spell of delight.
Business leaders have a job to do in keeping their people motivated and productive across the board. But the relationship between employers and employees, what people want from leaders, and how this manifests in the workplace has changed. On top of this, managing the workforce has become harder with younger generations as business leaders are still in the process of understanding their needs and wants.
Our research of over 35,000 global employees revealed that while engagement levels continue to climb, intent to stay beyond three years is declining, especially among the most engaged cohort: Gen Z. Whether this is due to changing values, as younger employees want purpose to align with personal values; workplace dynamics as remote and hybrid work has altered how engagement is perceived; or job market fluidity as increased mobility encourages employees to explore other opportunities. This paradox highlights that measuring engagement alone no longer predicts retention.
So how can business leaders ensure they are taking the time to understand the mindset of new entrants to the workplace, and what are the measures they can put in place to ensure they are creating an environment that prioritises employee engagement?
It starts by recognising that quick happiness fixes are no substitute for an experience tailored to individual career aspirations, wellbeing needs, and values alignment.
A fresh look at Gen Z in the workplace
As we look across generations, the younger employees have increased positivity when compared with others. Despite a rapidly changing work environment and perceptions around this generation of employee – this is a very positive signal.
Our study found that 77% of individuals aged 18-24 report feeling engaged at work, compared to 70% across all other age groups. Their readiness to challenge conventional practices and introduce innovative ideas isn’t a sign of discontent, but instead a reflection of their active engagement and desire to contribute in meaningful ways.
Young employees tend to be more optimistic about their career prospects. Some 75% of 18–24-year-olds believe their current company can help them reach their long-term career goals, compared to just 67% of older workers. They’re also proud of the positive impact their companies are making, with 76% feeling good about how their employer is trying to make the world a better place. But even this optimism is tempered by a fluid job market as Gen Z remains the most likely to explore new opportunities within months – not years – of joining a company.
Gen Z’s real strength lies in their willingness to shake things up. Nearly three out of four (72%) feel confident enough to challenge the old ways of doing things. But while it’s great to share new ideas, it’s just as important to stay realistic. That means leaders should create environments that encourage fresh thinking and also help employees understand the practical elements involved in implementing innovation. This will help the workforce change the lens through which it shares new ideas, asking themselves how every suggestion links back to the company’s strategy.
Additionally, 38% of employees report feeling pressured by their employers to increase productivity, and this is undermining both engagement and retention. The current pace of change and disruption alongside rapid adaption to new processes in the workplace provides a large risk of burnout for the workforce. A truly engaged Gen Z workforce is one where personal wellbeing and reasonable workloads are embedded into daily operations, not bolted on as separate programmes.
In short, for business leaders and managers, investing in Gen Z means more than just making them feel welcome – it’s about actively supporting their growth across every stage of their career lifecycle. With challenges like ever-changing skill demands and AI playing a more central role across organisations, one way to ensure people understand their growth is being supported is through integrated employee listening programmes, which provide support and a two-way dialogue on the issues that matter to the workforce.
A new perspective on increasing workplace productivity
In 2025, the most engaged employees will be those who see their work contributing to a positive future – for their own careers and the wider world. Our research shows that 82% of employees aged 18-24 are more actively engaged when they believe in their organisation’s values, and 76% are more future focused when they are proud of their organisation’s efforts to positively impact the world. However, engagement without a sense of connection and wellbeing support can be hollow. Organisations that excel now are the ones integrating mental health resources, flexible policies, and continuous feedback loops in everyday culture
For Gen Z employees, the action needed from business leaders is clear – it’s about building trust with your people so they are more likely to act proactively, change behaviours, and advocate for the business unprompted. This requires employers to adopt an employee-centred approach to change management. The best employers involve cross-generational voices early, and adjust policies based on feedback from employees across all levels.
To meet this need from employees, business leaders must display competence, integrity, and benevolence. This means putting themselves in a position where they are actively asking for feedback and ideas from employees beyond their immediate network. Ultimately, they should create meaningful connections through personalised career roadmaps, mentorship programmes, and assignments that reflect individual aspirations.
Working this way will help them make smarter, better, and more inclusive decisions – enhancing the experience for employees, driving engagement, and increasing the likelihood that high-performing talent stays.
Organisations need to be tapping into the talent and potential of 18–24-year olds, but they risk losing this segment of the workforce if they don’t understand what it takes to keep them both engaged and able to see a long-term future at the company.
To retain their Gen Z talent, business leaders must stop prioritising quick employee happiness fixes, instead focusing on purpose, growth, and wellbeing as a way to keep their people engaged, ensuring the workforce is provided with the opportunity to work towards the meaningful accomplishments they are craving. Programmes do not need to be built specifically around Gen Z, but this group should be factored into the overall thinking.
With several years of experience in the field of Culture and Employee Engagement, Simon's main areas of expertise revolve around thought leadership and measurement tools to help deliver on People Strategies such as survey design, management and interpretation. Over the last decade, Simon has cultivated an interest in different approaches and methodologies on employee listening, and the correlation to commercial performance and other metrics.
