It’s becoming increasingly clear all of us will remember 2020 as a crucial year in history. COVID-19 has transformed the way we live and work, and there’s reason to believe many of these changes will be permanent.
While the past couple of months have brought small gains and economic optimism, even hopeful projections suggest that the U.S. is facing a long fiscal recovery.
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Though the worst of COVID-19 will pass, and the economy will eventually rebound, things will not return completely to normal as advancements, structural changes, and economic fallout will affect younger generations such as Millennials and Gen. Z for decades to come.
When the dust settles, here are some of the changes you should expect:
Millennials will gravitate towards stability
The Millennial label is often misapplied to the youngest adults. In reality, the term encapsulates those born between 1981 to 1996, with the oldest Millennials about to turn 40. While some might picture Millennials as being entry-level employees, fresh out of college, the majority are either in or entering the prime of their careers.
Millennials’ lives have been defined by three seismic events: 9/11, during which nearly all of them were under the age of 18; the 2008 Great Recession, when many were either gaining a foothold in their careers or getting ready to graduate; and now the current COVID-19 environment, as they enter prime earning years.
Millennials are often labeled as job-hoppers who rarely stay with one employer for long. This is attributed in part to Millennials being less likely than other generations to feel engaged at work. Many Millennials are motivated by purpose-driven work first and foremost and do not see a reason to be loyal to employers who no longer offer the promise of security of long-term employment.
Notably, this transient employment pattern is what helped create the gig economy.
Chasing the next best opportunity is a decent strategy during times of economic prosperity. However, this economic crisis and COVID-19 have laid bare the risks of the gig economy. Layoffs plagued most industries, and companies looking to cut costs started with temporary workers and contractors. As a result, Millennial gig workers have been hit especially hard.
This is a depression-era moment for Millennials. According to CNBC, one in four Millennial families possess more debt than assets. A generation that was either unable—or in some cases, simply unwilling—to save money during times of economic prosperity has found itself in a deep hole.
It seems inevitable that Millennials will shift their priorities toward saving and stability, bucking the trend of a consumption-driven lifestyle. We are already seeing this shift, as the savings rate among Americans has grown to 33% of income in April, up from just 12% in March, showing that saving is possible even during hard times.
When the job market finally recovers, it seems likely Millennials will be more willing to trade maximum job satisfaction in exchange for more stability. Millennials who favored job-hopping over networking and building strong work relationships may find they’ll have a longer uphill climb ahead as they seek employment. This will be especially true for workers who departed previous roles suddenly, or on poor terms, and who don’t have a strong network to lean back on. Loyalty and solid relationships are crucial in tight job markets.
Gen Z will reevaluate higher education
Gen Z comprises those born between 1997 and 2012. Like Millennials, Gen Z is aging faster than you may realize—the oldest ones graduated from college last year and a vast majority will be at or above college age in the next several years.
For many in Gen Z, the economic challenges of COVID-19 will completely reframe their decision-making on college and graduate school. Some will see their college funds slashed due to collapsing assets, others will be concerned about taking on excessive student loan debt in a recession shocked economy—especially if the job market takes years to fully recover.
Gen Zers have seen how student debt has affected the generation above them. Witnessing Millennials delaying buying a house or starting a family because of crushing debt will make many members of Gen Z uninterested in following the same path.
Gen Z students likely can’t expect their parents to absorb hefty student loans either. In 2018, only 14% of parents were willing to take on over $75,000 in student loans for their children’s college. That number will be even lower after this crisis is over.
While the most prestigious schools will always draw attendees at any cost, private universities with less cache will struggle in this new reality. Not only will public colleges become more desirable, but as students are introduced to distance learning during the COVID-19 outbreak, colleges may seek to expand their online offerings to offer lower-cost education and more free online content.
These shifts, in addition to more resounding calls to reduce student loan debt, are likely to finally burst the higher education bubble that has been expanding for years. Many schools may close as a result.
Building capacity for the new normal
For students and younger professionals, this seems like the worst-case scenario. Millions of people will be facing the same conundrum—either beginning or rebuilding a career on a shaky economic footing. To raise chances of excelling, Millennials and Gen Z should prepare for this new normal through a process called capacity building.
Capacity building is the foundation of self-improvement and has four core elements—spiritual, intellectual, physical, and emotional capacity. Among other things, building capacity involves reflecting intentionally on what we want most out of life, continuously learning, building productive physical and mental habits, and improving our relationships.
Millennials and Gen Zers who aren’t sure what to do in a frightening time can use this as an opportunity to reflect and grow. It’s important to ask yourself:
- What core values are most non-negotiable for you, personally and professionally?
- What are your long-term career and financial goals, and what short-term goals do you need to set to reach that destination?
- What personal and professional relationships do you need to invest in to help recover from this challenging time—and which relationships are not worth the energy?
Building your capacity will not make COVID-19 disappear or cause the economy to suddenly recover, but it will help you build the clarity, goals, habits, and relationships you’ll need to succeed in the new normal.
With little warning, COVID-19 is changing everything about our lives – changes that have far-reaching implications for younger generations. While it seems like we are in the early stages of an unending challenge, the crisis will pass and with capacity building, you can make sure you’re ready to make the most of your opportunities.