Gen Z: Entrepreneurial Hustlers or Why Work?
Recent editorials about Gen Z say they frame life as all about forging an entrepreneurial career where you can be your own boss. Should we expect a radical departure from current patterns? US Census Bureau data shows that the average age of an entrepreneur is 42 and has been for decades. Are Gen Zs the real Hustle Generation? Will they finally bring this number down? Among a slew of recent statistics touting Gen Z's entrepreneurial tendencies are
62% of Gen Z respondents either have their own business or are open to starting one (Microsoft Corporation)
72% of Gen Z respondents reported having a side hustle (Bank of America)
54% of Gen Z respondents believe they'd be happier owning their own business than working a normal day job (CNBC and Survey Monkey)
Before we expect a surge of entrepreneurship, we should reconcile how this fits the stereotype that Gen Zs eschew work and the 9-to-5 grind.
Hustle or get left behind?
Some stories about Gen Zs paint a dark picture of what's driving entrepreneurship. The Business Insider's "Gen Z is the Hustle Generation" suggests Gen Zs are forging their own career paths because of the broken social contract between individuals and society. Society is not meeting its expectations of mutual responsibilities and benefits, such as a government providing equitable opportunities to its citizens in return for legal compliance. In this environment, Gen Z is striving to "achieve personhood." Kylie asked Chat GPT what this means. The AI told her it relates to legal and social recognition, moral and ethical considerations, and biological and cognitive attributes. Gotcha!
What me hustle?
The Economist describes data suggesting "Generation Z is unprecedentedly rich," as measured by household income by generation, after accounting for taxes, government transfers, and inflation. Gen Zs spend less time on work and work-related activities than previous generations, producing fewer innovations than millennials at the same life stage. One Gen Z in Christina's household mused that getting a job during the summer between high school and college might ruin the last months of childhood. Gotcha!
A broken social contract? Higher generational wealth? Disinterest in work? Achieving personhood? We can explain. Our surveys of Young Americans, in partnership with the Wake Forest University Center for the Study of Capitalism and YouGov, ask 2,000 millennials and Gen Z about business ownership, aspirations to own a business, self-perceptions of entrepreneurial tendencies, ideas about work, and more.
Here's our take, with stats below. Pay matters. Gen Zs want a good salary. 60% aspire to own a business, 38% see themselves as entrepreneurial, and 7% actually own a business. Most, quite reasonably, say vision and work experience matter the most when starting a business.
On most metrics, they look like millennials. The Gen Zs in our surveys scored lower than millennials on several psychological indicators related to entrepreneurship, including sentiment around optimism, risk, and agency. Psychologist Jean Twenge shows Gen Zs score lower on these measures than older generations when they were at the same stage of life. By some measures, Gen Zs grow up more slowly. They also receive a constant stream of negative messaging about the state of the world.
So, aspirations might not match reality now, but what about the future? We don't see Business Insider's view of Gen Zs spinning in circles: They want to leave traditional work to achieve personhood but lack the mental tools to do so, which fosters even more dissatisfaction with conventional work and less chance of attaining personhood.
Entrepreneurship that's not a grind?
Most Americans, no matter where they are in the quest for financial security and "personhood," work because it contributes to a sense of personal well-being. It should not be surprising that Gen Zs are interested in a good salary and spending less time at work than previous generations. Thanks to capitalism, living standards in the United States have risen for 50 years while we've spent less time at work. Today, it's about 35 hours.
In terms of aspirations, self-perception as being entrepreneurial, and owning a business, Gen Z doesn’t look too different from millennials. Gen Zs (and millennials) sound reasonable in thinking that combining vision, passion, and relevant work experience is one road to entrepreneurial success. The Gen Z “bonus” of being unprecedentedly rich and experienced in their 40s may be a good jumping-off point for trying entrepreneurship.
Leading Gen Zs: Entrepreneurship, intrapreneurship, and hustle
Americans are the quintessential entrepreneurs. Side hustles will rise and fall with pay level, inflation, how much time someone has, and a kind of personal drive that's hard to define.
If you are a fan of entrepreneurship and are leading Gen Z employees, we suggest two things. First, why discourage a side hustle if it does not conflict with engagement and accomplishment? A side hustle is one path to help an aspirational entrepreneur get closer to their dream of business ownership. And they might ask you to invest in a great idea!
Second, encourage intrapreneurship through psychological safety. Do your Gen Zs have entrepreneurial tendencies? Great! How can you promote intrapreneurship within your organization? Do some Gen Zs struggle with risk-taking? We like Amy Edmondson's perspective in The Fearless Organization on creating psychological safety for teams. She defines this as an environment where team members are encouraged to speak up, take intelligent risks, and admit mistakes without negative consequences.
While descriptions of Gen Z's views of entrepreneurship and work can range from head-scratching to contradictory, we are sure that the quickest path to personhood is less mulling and more doing.