In 2016, Bank Director conducted research about the retention rates of different generations within the banking space. They found that only two-thirds of banks surveyed were actively trying to attract millennials as employees at the time. However, out of those two-thirds, only half of those banks had been successful in their recruitment efforts. The remaining 33% of banks surveyed stated that attracting millennials was not a current focus. But what about now? Five years down the line? And what about Generation Z? Here’s why forward-thinking banks need to recruit Gen Z today.
Who Is Generation Z?
The truth is, the lines are blurred. Generation Z is essentially known as the generation that never experienced life without technology. Those who are a part of Gen Z were typically born between 1995 and 2010, yet this range of years is often up for interpretation.
Why Is This Generation Important?
Inc. Magazine wrote, “Just when you’d grown accustomed to Millennial employees, Gen-Z is about to enter the workforce.” And it’s true! Gen Z is extremely important. According to research done by Concordia University, St. Paul, this group brings over 61 million job seekers.
In fact, pre-COVID, Inc. Magazine predicted that Gen Z would make up 24% of the global workforce by 2020. Now, as the end of the global pandemic sits on the horizon, Gen Z is hungry—returning to the workplace with full force. The data considered, banks must be ready to hire and recruit the next (and largest!) generational cohort. But what can they offer?
Gen Z Employees Can Cater to Gen Z Customers
It’s no surprise that people typically have an easier time relating to and working with people from similar demographics. Banks and credit unions alike need to appeal to Gen Z customers, and there are many ways in which you can do so—including who you hire.
Did you know Gen Z makes up $143 billion in United States buying power? This equals out to approximately 40% of all consumer shopping! For obvious reasons, attracting and recruiting this demographic is essential to the success of your bank.
Many banks have begun to realize that they need to capitalize on this generation and attract them as customers. Traditional banking is losing ground to online banking and challenger banks—especially banks that operate exclusively online. Many of these banks are overseas at the moment, but they are quickly moving toward the states. What about your bank? Are you losing ground? You may be failing to make a connection with your customers, many of whom are Gen Z.
Today’s banking customers expect more from their financial institutions. Gen Z, born between the 1990s and 2000s, have lived their entire lives in a technology-rich world, especially when compared to older generations. As a whole, the population is more comfortable with technology and demands convenience in the form of easy-to-use mobile banking. If banks don’t keep up, they’ll be left in the dust.
Gen Z Is Superior Regarding Technology
It may come as a surprise to some, but most financial institutions are now active on social media, and not just on LinkedIn, but on Instagram, Facebook, and Twitter too. Forward-thinking banks use social media to market themselves and to provide customer service, which helps them connect to tech-savvy Gen Z and the growing number of users from all generations.
So, if banks are trying to reach Gen Z and pursuing these social media channels, who better to help make that connection than Gen Z themselves? Having Gen Z employees on your marketing team can be a great asset, and in any role, they can help drive the direction of initiatives that appeal to other Gen Zers. The bottom line: Gen Z relates to and understands the technology platforms that today’s banks must use.
With their knowledge of how today’s customers interact with social media, marketing isn’t the only area Gen Z can help out. Gen Z can be a great asset in the IT field especially for banks that want to keep up with financial technology. In today’s tech-dependent world, it’s vital to support customers using online banking services and provide them with a positive user experience. Otherwise, customers may flee to a more convenient banking option.
Knowledge of cybersecurity is also crucial in the financial technology world as your banking customers are trusting your institution with sensitive data. Cybersecurity professionals may be members of any generation, but you’ll miss out on a wealth of talent if your bank’s technology team ignores these valuable assets.
Gen Z Brings a Fresh Perspective
Let’s face it. Gen Z has a different perspective than many incumbent bankers. Current bank leadership is aging, and top talent is exiting the industry as their retirement dates approach. Retirement, however, isn’t the only reason talent is leaving. Some employees are moving into other industries with fewer regulations, or are even going to work for competitor banks. The loss of current bank employees makes it all the more vital to draw in Gen Z, who will be the next generation of bankers—and to start now.
Beyond the simple need for new employees to replace those who are retiring or leaving the financial industry, banks need personnel with fresh perspectives if they hope to move forward. Marketing and technology aren’t the only areas Gen Z can bring new ideas to banks. Every department can benefit from the input of a different generation.
Each generation has its own quirks and its own merits. Additionally, each generation comes with its own negative stereotypes. Indeed, many articles have called Gen Z overly dependent on technology and cast them as lazy and entitled. However, just as many articles have rebutted this position and cited studies showing that Gen Z is hardworking and innovative.
Instead of pitting generations against one another, we at Newcleus recommend considering what we can learn from one another. After all, Gen Z is here to stay, so seasoned bankers should focus on the merits of the younger generation and pass on the knowledge they have. While Gen Z may bring a fresh perspective to banking, there’s no substitute for years of experience. The takeaway is that generations need to work together!
The Beauty of a Well-Crafted Benefits Package
To attract Gen Z employees to your bank, you need to offer the right benefits packages in ways that attract and retain them. Gen Z cares about traditional benefits while also being interested in perks like flexible schedules and the organizational culture of their workplace. Additionally, many who are a part of Gen Z want to feel like they’re making a difference in their careers and in the world as a whole. Newcleus Bank and Compensation Advisors can help you determine how to compensate Gen Z properly.
Through our deep knowledge and extensive experience within the banking industry, we bring our clients better strategies, products, and support. Our goal is to add income to your bottom line that can be available to fund meaningful and effective compensation programs. Then, your bank can begin to attract and maintain Gen Z employees that will bring new ideas and carry your bank into the future.
Empower Your People
The bottom line: forward-thinking banks need to recruit Gen Z. The reality is that this generation makes up the banking customers and employees of the future.
According to research, Gen Z already constitutes 30% of the world population, and in ten years, they will account for a third of global consumers. This considered, banks should be engaging them from a hiring and training perspective. Gen Z can bring so much to the table. And at Newcleus, we believe it’s well worth your time and dollar to focus your efforts on recruiting them.