Reward preferences to attract and retain Generation Z

Abstract

Orientation: Generation Z (Gen Z), born between the mid-1990s and early 2000s, has become an essential part of the workforce. However, attracting and retaining this generation is challenging because of their distinct work expectations. To remain competitive, organisations must understand Gen Z’s reward preferences.

Research purpose: This study aims to explore the total reward preferences of Gen Z, identifying the factors that most effectively attract and retain this generation in the workplace.

Motivation for the study: As Gen Z enters the workforce, their unique expectations for extrinsic and intrinsic rewards present new challenges and opportunities for employers. Understanding these preferences is crucial for developing reward systems that attract and retain talent, ensuring long-term organisational success.

Research design, approach and method: A qualitative, interpretivist approach using phenomenological methodology was adopted. Semi-structured interviews provided insights into reward preferences and retention factors, with data analysed inductively to identify themes.

Main findings: The study found that Gen Z values extrinsic rewards such as compensation, benefits and recognition. However, intrinsic motivators such as personal growth, a sense of purpose and the desire to impact also significantly influence their job satisfaction and organisational commitment.

Practical/managerial implications: Organisations aiming to attract and retain Gen Z employees should implement reward strategies that balance extrinsic and intrinsic motivators, aligning with their values to enhance engagement, satisfaction and retention.

Contribution/value-add: This research offers key insights into Gen Z’s reward preferences and provides practical guidance for tailoring reward systems to meet their expectations, promoting a more engaged and productive workforce.