Gen Z is entering a very different labor market than Millennials did nearly two decades ago. Young Gen Z adults are less likely to participate in the labor force or be employed, but those who enter the workforce face lower unemployment, and those working full time earn more in real terms.
Zety, a leading resume builder, released its Early-Career Labor Market Report, analyzing U.S. Bureau of Labor Statistics data for adults ages 20–24 during two comparable early-career periods: Millennials from 2005–2008 and Gen Z from 2021–2024.
The comparison looks at labor force participation, employment, unemployment, and inflation-adjusted weekly earnings to show how the early-career labor market has changed across generations.
Key Findings
- Gen Z is less present in the labor force: Gen Z adults have an average labor force participation rate of 71.1%, representing those working or actively looking for work, versus 74.5% for Millennials at the same age.
- A smaller share of Gen Z is employed: Gen Z’s employment-population ratio averaged 65.8%, below the Millennial average of 67.9%.
- Gen Z labor-force participants experienced lower unemployment: The unemployment rate averaged 7.5% for Gen Z, compared with 8.9% for Millennials.
- Full-time Gen Z workers outpace Millennials on pay: Inflation-adjusted median weekly earnings averaged approximately $756 for Gen Z and $674 for Millennials.
Gen Z Has a Weaker Connection to the Labor Force
The share of young adults participating in the labor force was consistently lower during the Gen Z period.
From 2021 through 2024, labor-force participation among adults ages 20–24 averaged 71.1%. When Millennials were the same age from 2005 through 2008, the rate averaged 74.5%.
That 3.4-percentage-point difference means a greater share of Gen Z adults are outside the labor force entirely, neither working nor actively looking for work.
A similar, although narrower, difference appears in employment. Gen Z’s employment-population ratio averaged 65.8%, compared with 67.9% for Millennials. In other words, a smaller percentage of Gen Z adults ages 20–24 held jobs during the period studied. Early-career metric
| Millennials Ages 20-24 (2005–2008) | Gen Z Ages 20-24 (2021–2024) | Gen Z Difference | |
| Labor force participation | 74.5% | 71.1% | −3.4 pp |
| Employment-population ratio | 67.9% | 65.8% | −2.1 pp |
| Unemployment rate | 8.9% | 7.5% | −1.4 pp |
Source: U.S. Bureau of Labor Statistics Current Population Survey, Table 3, annual averages.
Gen Z’s Lower Unemployment Rate Tells a Different Story
Despite having lower participation and employment rates, Gen Z did not experience higher unemployment.
The unemployment rate averaged 7.5% during the Gen Z period, compared with 8.9% during the Millennial period. That represents a 1.4-percentage-point advantage for Gen Z.
The distinction is important. The unemployment rate measures the percentage of labor-force participants who are jobless, available to work, and actively looking for a job. It does not include people who are outside the labor force.
In other words, Gen Z adults are less likely to participate in the labor market overall, but those who do participate are less likely to be unemployed than Millennials were at the same age.
Full-Time Gen Z Workers Earn 12% More
Gen Z also has an earnings advantage.
Inflation-adjusted median weekly earnings for full-time wage and salary workers ages 20–24 averaged $756.25 from 2021 through 2024. For Millennials in the same age group from 2005 through 2008, the average was $673.50.
That amounts to approximately $83 more per week, or a 12.3% difference in Gen Z’s favor.
Source: U.S. Bureau of Labor Statistics Current Population Survey, Table 17, annual averages.
On an annualized basis, these weekly earnings equate to approximately $39,300 for Gen Z and $35,000 for Millennials, a difference of roughly $4,300 per year. Because the comparison is expressed in 2024 dollars and adjusted for inflation, the difference reflects higher inflation-adjusted weekly earnings rather than simply the effect of rising wages and prices over time.
A Mixed Early-Career Picture
Taken together, there is no clear indication that either generation had a stronger start overall.
Millennials were more likely to participate in the labor force and more likely to be employed at ages 20–24. Gen Z labor-force participants, however, experienced lower unemployment, while full-time Gen Z workers received higher inflation-adjusted weekly pay.
The result is a divide between access and outcomes. A smaller share of Gen Z has established a place in the workforce, but those working full time are earning more than Millennials did at the same age.
The comparison does not establish why Gen Z participation is lower. Factors such as school enrollment, economic conditions, caregiving responsibilities, delayed workforce entry, and decisions about whether to look for work may all affect whether young adults participate in the labor force. For detailed insights on the Early-Career Labor Market Report, access the full study at https://zety.com/blog/early-career-labor-market-report.
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