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A disillusioned generation? How startups can overcome a new challenge in the tech industry

As the wider tech ecosystem comes under increased pressure with a burgeoning global financial crisis and talent shortage –  a new crisis is unfolding. The disillusionment of young professionals in the industry. According to the Young Generation in Tech report, under-30s in tech are feeling disappointed, disillusioned and insecure.  

It’s been reported that more than a third of young tech workers (35%) are unhappy in their role with over half (54%) considering a complete change of career plan. That’s what a recent report carried out by HRtech innovators HiBob and leading global venture fund, Eight Roads, has uncovered. And the picture looks pretty doom and gloom if we’re honest about it. 

We take an overview of the situation to provide you with actionable insights and proactive tips to address this surmounting challenge.

In recent months, one thing has consistently caught the headlines – a trend amongst young people to ‘quietly resign’, to clock in for their designated hours, and remove passion and feeling of emotional or personal connection to their work. It comes as a younger generation grows increasingly disillusioned with their careers and all out of love with the work. Whilst we don’t advocate the hustle burnout-laden lifestyle that many people befall to, we wanted to explore a little more about this growing culture of disillusionment. 

Young Generation in Tech

Commissioned by HiBob and Eight Roads, the Young Generation in Tech survey took a deep dive into how young people perceive their jobs – and the resulting figures are quite the eye-opener and a wake-up call for the tech industry. The survey gathered the insights of thousands of 20-30-year-olds working in tech startups, scaleups and enterprises Europe-wide (including France, Germany, Ireland, the Netherlands, Spain and Sweden). They were asked about their ambitions and fears. The sample included both technical and non-technical roles across engineering and product management, marketing, sales, operations and C-Suite positions. 

At a quick glance, the report finds that more than half of tech workers are considering a change of career plan, with over a third of young workers in the UK and Sweden, two startup powerhouses, saying that they expect to be laid off in this economic downturn. What’s more, 70% of respondents would not recommend their workplace to friends or family, while a fifth of young people across Europe are actively looking for another job or plan to leave

Put plainly, tech jobs are not meeting younger people’s expectations with only 19%  in France, 23% in Ireland and 27% in the UK saying their job is better than expected.

So what’s going on? 

The responses suggest that young employees may be falling out of love with the tech sector. They suggest that as the industry faces an economic downturn, companies need to urgently address issues including career development, progression, remuneration and workplace relationships if they are to keep their best talent from leaving the industry. 

Jobs not meeting expectations

Across Europe 30% of the 20-30-year-olds surveyed described their current job as falling below their expectations, leading to poor job satisfaction, with the younger age bracket (20-25) being most affected. Only 30% of respondents said they would recommend their workplace to friends or family, identifying a lack of good relationships, inadequate compensation, and poor career development as a source of unhappiness.

The measures that would encourage dissatisfied employees to stay in their roles included better career progression (37%), an increase in salary (34%) and a contract that protected them against layoffs (18%), the survey found. 

The younger generation is also more likely to demand flexible working hours – and often now find older management members to work in rigid schedules that just don’t make sense to them. The survey found that flexible hours were the most valued workplace condition among young people, with 1 in 4 joining their current company due to a flexible working model. Yet the challenges of implementing flexible working are laid bare in that nearly one in five said that lack of time in the office, and the opportunity to build relationships was one of the things they liked the least about their role. So it’s clear that companies need to do something to address this – offer flexibility but keep socialization as a  key part. 

In fact, relationships were found to play a significant role in job satisfaction across the board.  Almost half (49%) of young people surveyed said their immediate team and co-workers were what they liked most about their company. While poor relationships with their managers were their biggest dislike. 

The picture looks different across Europe. In France, only 19% of tech workers said their job exceeded expectations, while 23% in Ireland and 27% in England said their job exceeded expectations. Meanwhile, Germany has the strongest figures in this regard (if still slightly disappointing), with  30% of German workers ranking their experience at work at 9 or 10.

Lack of job security

In times of uncertainty, younger generations are craving new and refreshed job security. Let’s face it, the current world is full of uncertainty and anxiety. From getting over a global pandemic  to dealing with war in Europe and the ever-present climate crisis – and that’s not to mention the global economic downturn. 

Young people, understandably in this context, want some job security. And this is becoming a key priority. 

The Young Generation in Tech survey also shows that across Europe, Gen Z and younger Millennials are prioritizing jobs they believe will give them greater security over work enjoyment and job satisfaction.  

The most attractive feature when looking for a job (as chosen by 27% of those surveyed)  was the future potential of a company, closely followed by job security (25%). This motivation was highest in Spain and was higher in the older age bracket of 26-30-year-olds, in comparison to the 20-25-year-olds surveyed. Worries over job security even out-ranked the compensation packages on offer (23%), and were on par with working hours or models (25%), across all regions. In contrast,  only 18% of workers in Europe said they moved to their current role for promotion.

Job insecurity means that workers have less ability to make long-term decisions, leading over half (54%) of all tech workers in Europe to consider a complete change of career plan.  Workers in both Spain (60%) and the Netherlands (59%) consider their career plans most impacted by the downturn. 

So what can we do about it?

Rather than just point out the facts, we wanted to be more proactive and identify the ways the tech community reacted to these findings. How can tech startups attract young talent, nurture it and address these concerns of a generation?

According to the Eight Roads team, “talent is vital to the European tech industry”.

Therefore, talent needs to be nurtured and protected – and this comes with addressing concerns, not hiding from them. 

“Our findings should inspire leaders to reflect and make changes. As an ecosystem, we need to address the stability and satisfaction of workers and create an environment that will continue to attract and retain top talent sustainably. It is now time to innovate and rethink what inspires and engages the new generation in the workforce.”

HiBob, a leading HRtech startup aiming to transform how organizations work in the modern world and pace the way for a modern, future-thinking workplace, believe that having a bidirectional and agile tech stack is crucial to help HR teams navigate evolving circumstances and to build a company culture that can ride the waves of change. 

Their recommendations?

  • Create people-first culture supported by flexible HRtech

“The key to success and coming out on top no matter what’s going on in the market is a people-first culture and business strategy. Culture is critical in times of change.  Although it’s natural to be concerned about the global economy, people are resilient, and it’s critical to continue prioritizing your people as your business’s most valuable assets.” 

  • Business agility relies on your workforce – so nurture their skills

Business agility relies on your workforce’s skills, creativity, and experience, and it’s why providing a culture that supports them is essential. The right HR tech can help you tap into people’s innovation, motivate them, and help your business “identify areas where [you] can maximize profits without increasing costs,” all while retaining your top talent.” 

  • Trust and communication are fundamental

“Nothing powers a healthy culture, business strategy, and employee engagement more than frequent and honest communication, especially if you’re managing globally dispersed teams. We hear this from our customers all the time and know this from our own experience in growing our own business. No matter what decisions you may have to make, being transparent about what’s going on in the market today and how it can affect the business and every team member builds trust. Trust helps keep attrition low and retention, innovation, and productivity high. It’s the cornerstone of healthy company cultures and business resilience. Powerful communication tools empower people to bring their voices and innovations to the table. At the same time, they help companies understand who their people are, where they can improve, and how they can support their people now and in the future.”

  • Know your people

“Talent management tools are essential, and the best ones are bidirectional, supporting businesses in times of growth and cool downs. Retaining top talent is just as–or even more–important now than ever. Businesses need top talent’s innovation, resiliency, and enthusiasm to thrive.  Every tech talent tool must help companies answer tough questions, find practical solutions, and keep their best talent happy and motivated, ultimately supporting a healthy culture and business agility.

Knowing your people, the value they bring, and how their skills help propel your business forward is the foundation of an intelligent talent management strategy in any market climate.”

  • We’re in this together

“The current economic slowdown is just one more challenge that we will work together to power through. Slowdowns can be an excellent opportunity to find creative ways to run a leaner and more efficient business.  Companies spent the last two years investing heavily in people. Wherever the market might be headed, there’s still a huge shortage of skilled professionals. Now is not the time to let your investment in talent go to waste.”

While young people are going increasingly disillusioned with the world of work, companies across Europe need to be proactive and take action. They need to look after talent, nurture up-and-comers and listen to the real concerns and anxieties that young people have. By taking a thoughtful, people-first approach to HR strategy and committing to developing talent, companies can encourage employees to feel more valued and supported in their careers.

Businesses should also make sure they are allowing for a healthy work-life balance, that works in favour of and not against employees – achieving this takes some creativity and a preparedness to be flexible and agile.

Young people want to be listened to. They want to be appreciated and have some security. 

Patricia Allen
Patricia Allen
is the Head of Content at EU-Startups. With a background in politics, Patricia has a real passion for how shared ideas across communities and cultures can bring new initiatives and innovations for the future. She spends her time bringing you the latest news and updates of startups across Europe, and curating our social media.

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