Generation Z, comprising over 2 billion individuals born between 1995 and 2012, represents about 30% of the global population. In 2025, this demographic makes up approximately one third of the global workforce, stepping in to replace retiring Baby Boomers. While their influence is growing, so are their challenges, particularly when it comes to mental health and well-being.

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Understanding the Gen Z Mental Health Crisis

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Mental health challenges among Gen Z have reached concerning levels, with financial and employment instability playing a significant role. Compared to older generations like Baby Boomers, Gen X, and Millennials, Gen Z faces disproportionately higher unemployment rates in almost all OECD countries; nearly double that of their predecessors. In a 2024 report, the Resolution Foundation explored the link between unemployment and mental well-being, finding that people in their early 20s with mental health conditions are more likely to be out of work or in low-paid jobs than those in their early 40s. Data from 2021-22 further underscores this connection, showing that 34% of individuals aged 18 to 24 reported symptoms of mental disorders, including anxiety, depression, and bipolar disorder.

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Gen Z’s mental health challenges are largely shaped by their formative experiences as the first fully digital generation. Growing up with constant access to technology, they have benefited from increased global interaction and adaptability but have also been exposed to cyberbullying, unhealthy comparisons, and other negative effects of social media. A study by King’s College London and the Orygen Institute found that two-thirds of people in the UK attribute the rise in youth mental health problems to social media use. While Baby Boomers and Gen X tend to associate these issues with drug and alcohol use, Millennials and Gen Z cite financial pressures and social media as primary factors.

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Within this same digital landscape, Gen Z faces a heightened awareness of global crises, including climate change, wars, and economic inequality, which amplifies feelings of uncertainty. These concerns, combined with self-comparison, social expectations, and the lasting effects of austerity and rising living costs, create a complex web of pressures affecting their mental well-being. Understanding these intersecting challenges is essential to developing meaningful support systems that address the unique struggles of this generation.

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Gen Z and Work: Unique Challenges and Expectations

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As Gen Z enters the workforce, many are finding that traditional work environments are not equipped to support their well-being. The 2024 Voice of the Workplace Report by Calm revealed that 90% of Gen Zers report feelings of stress and anxiety, and 74% feel down or depressed. The report also highlighted that Gen Z employees often face a lack of built-in social support systems, a stark contrast to previous generations who benefited from more communal workplace structures. This gap in support is contributing to a range of mental health issues. Notably, 35% of Gen Zers report frequent anxiety due to the rapid pace of technological change in the workplace, and higher levels of career uncertainty compared to other age groups, adding to their stress levels.

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Despite these difficulties, Gen Z is actively reshaping the workplace to better suit their needs. Over 75% of Gen Z employees advocate for improved workplace benefits and a stronger focus on mental health support. They are also 60% more likely than other generations to push for diversity and inclusion initiatives, reflecting their desire for workplaces that prioritise equity and representation, challenging employers to rethink how they address the well-being of their employees.

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Recommendations for Workplaces

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Given the significant challenges faced by Gen Z in the workplace, several actionable strategies can help organisations better support employee well-being, as suggested by existing literature:

 

• Address Financial Stress: Offer financial planning resources, budgeting workshops, and adjust wages to reflect cost-of-living increases.

• Promote Diversity and Inclusion: Foster a culture of inclusivity and celebrate diverse perspectives. Research shows that this approach attracts Gen Z talent.

• Provide Mental Health Resources: Expand access to therapy, digital self-care tools, and mental health days. Train managers to identify mental health challenges and establish work-life boundaries.

• Build Social Support Systems: Create mentorship programs and interest-based social clubs to reduce loneliness and foster connections among employees.

• Adapt to Technological Changes: Provide training to help employees manage workplace technology effectively. Implement policies to limit after-hours communication and prevent burnout.

 

Although these changes require time and a strategic plan to ensure they are both sustainable and measurable, together these strategies offer a holistic approach to addressing Gen Z’s unique needs in the workplace, fostering a healthier and more supportive environment. However, the challenges facing this generation do not impact only individuals — they also have significant implications for businesses. Companies are increasingly having to make redundancies and cut costs while also contending with high turnover rates, decreased engagement, and workforce instability. Striking a balance between meeting employee expectations and maintaining financial sustainability has become a pressing challenge for many organisations.

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One key generational shift influencing workplace dynamics is the delay in major life milestones. Today, young UK adults are waiting longer to marry and start families, with heterosexual couples now typically having their first child in their 30s, compared to their parents’ generation, where the norm was between ages 24 and 25. This postponement — or in some cases, the decision to remain child-free — has given Gen Z greater freedom to leave jobs that do not align with their values or lifestyle.

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This shift in priorities has contributed to the rise of ‘job-hopping,’ with Gen Z employees staying in roles for an average of just 2 years and 2 months, less than half the tenure of Gen X (5 years) and a quarter of the average for Baby Boomers (8 years). Unlike previous generations, where long-term 'company loyalty' was common, retaining young talent today requires a different approach. Beyond implementing broad initiatives, employers should actively listen to their workforce, seeking input on their needs, expectations, and areas where the organisation falls short. Ultimately, workforce retention is not just about providing career growth opportunities or competitive salaries but also about fostering an environment where employees feel valued, supported, and engaged in their day-to-day experience.

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Looking Forward

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The challenges faced by Gen Z signal a fundamental shift in workplace dynamics — one that requires a proactive, nuanced approach from employers. As this generation navigates financial instability, mental health concerns, and shifting career expectations, businesses must recognise that supporting employee well-being is not just a ticking exercise but a strategic necessity. Organisations that fail to adapt risk higher turnover, disengagement, and long-term uncertainty.

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While financial support, mental health resources, and inclusive policies are crucial, real change comes also from actively listening to employees and fostering a workplace where they feel valued. Striking a balance between meeting Gen Z’s expectations and maintaining financial sustainability will be key, but organisations that prioritise well-being today will build a more resilient, engaged workforce for the future.