You can’t fire Gen Z, they quit

More young employees want to leave the workplace due to mental health, as mass layoffs lead to decreased engagement and morale.

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Job cuts might be dominating the news headlines today. But despite this apparent lack of job security, one in four young employees is considering quitting anyway, primarily due to mental health issues.

The research, by consultancy PwC, has found that 25% of British 18-24 year olds have considered leaving the workforce in the last year.

With many firms planning to carry out further job cuts due to increases in National Insurance Contributions (NICs), younger employees could be jumping ship before they find themselves at risk of getting fired.

More young workers are quitting due to mental health

In all, PwC’s survey revealed that 19% of employees of all ages had considered quitting their jobs in the last year. However, employees under 35 were more likely to call it quits.

Julia Turney, Partner and Head of Platform and Benefits at BW, says that the PwC findings show that younger workers are “rejecting the traditional corporate ladder” and prioritising wellbeing and work-life balance.

Turney added: “Our own research of UK employees recently found that reports of stress, anxiety and burnout were at their highest among young workers, leading to two-thirds taking extended sick leave in the past five years.”

Survivor’s guilt: mass layoffs are worsening morale

According to the CIPD, 25% of employers were planning to carry out redundancies in the three months to March 2025, an increase from 21% the previous year. Most employers blame the rise in NICs and a 6.7% increase in the living wage for the reduction in headcount.

With many businesses planning layoffs this year, it might seem surprising that younger employees are choosing to exit the workforce and risk being unable to find another role in future. One explanation could be survivor’s guilt.

The high number of redundancies that have been made in the last year at UK workplaces has raised anxieties over job security and has also affected the morale of those who remain. 

Research reported by People Management found that HR leaders are deeply concerned that layoffs are negatively affecting their company’s organisational culture

27% cite the impact of job losses on employee engagement as a key concern. Meanwhile, 68% of employees report a high level of “survivor’s guilt” following mass layoffs, which could be affecting their willingness to stay in work.

Sally Bendtson, founder of Limelight HR, said: “[Layoffs can] change the shape and dynamic of the team and business and, for those who remain, there’s the loss of friends and teammates to process. 

“Many staff take on new roles or additional work while still harbouring concerns that their own job might be at risk.”

Employees may jump before they get pushed

With young employees planning to up and leave the workforce, and bosses planning to let more workers go this year, there will likely be a lot of people out of work in the next 12 months — willingly and unwillingly.

This is bad news for businesses. Firing team members may help to strengthen cash flow in the short-term, but organisations undeniably need talent to grow.

At the end of last year, we asked 531 SMEs to tell us what they thought had been the biggest contributors to their success in the last 12 months. 52% of business leaders named a talented and motivated workforce as a key factor.

Government statistics reveal that 270,000 employees aged 16-34 are already economically inactive due to long-term sickness and mental conditions. If staff turnover and unemployment continue to rise, it could be disastrous for the UK’s economic recovery.

“[With] business costs set to skyrocket in coming months, employers are now walking a financial tightrope,” Turney adds. “There is an urgent need to prioritise the health of our workforces; not just as a moral imperative, but as an economic and business necessity.”

Written by:
With over 3 years expertise in Fintech, Emily has first hand experience of both startup culture and creating a diverse range of creative and technical content. As Startups Writer, her news articles and topical pieces cover the small business landscape and keep our SME audience up to date on everything they need to know.

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