Gen Z Earnings Growth Surpasses Millennials at the Same Age
For years, younger workers were expected to face the same financial struggles as millennials. However, new research shows that Gen Z Earnings Growth is breaking that pattern. A recent report from the Resolution Foundation found that today’s young workers are earning more than millennials did at the same age, offering a rare piece of positive economic news.
The findings suggest that people born in the early 2000s are benefiting from stronger wage growth than many previous generations. While challenges remain, the data points to a more promising start for Gen Z workers entering the labour market.
What Gen Z Earnings Growth Reveals About Young Workers
First, the research compared the earnings of workers across different generations. The study found that 24-year-old Gen Z workers earn around 12% more in real weekly wages than millennials earned at age 24.
This marks a significant shift from the experience of millennials, who entered the workforce during the aftermath of the 2008 financial crisis. Many faced years of weak wage growth, fewer job opportunities, and rising living costs.
According to researchers, people born in the early 2000s are now earning more at age 24 than any generation born since the 1950s. This improvement highlights the changing economic conditions that have benefited younger workers in recent years.
Why Gen Z Earnings Growth Is Outperforming Millennials
Next, it is important to understand why Gen Z workers are seeing better results.
Millennials entered adulthood during one of the toughest economic periods in recent history. The global financial crisis slowed hiring, reduced wage growth, and created long-lasting effects on career progression.
In contrast, many Gen Z workers joined the labour market during a period of labour shortages and increasing demand for workers. Employers have been forced to offer better wages to attract and retain staff.
At the same time, rising competition for skilled employees has pushed salaries higher across several industries. This has helped younger workers secure stronger starting wages than previous generations.
How Minimum Wage Policies Support Gen Z Earnings Growth
One of the biggest drivers behind Gen Z Earnings Growth has been increases to the UK’s minimum wage. National Minimum Wage and National Living Wage rates
Since 2016, significant rises in the National Living Wage have boosted earnings for lower-paid workers. The report found that workers in the bottom 10% of earners experienced the largest gains.
Their real earnings increased by approximately 36% between 2012 and 2025. This represents one of the strongest periods of wage growth for lower-income employees in decades.
Meanwhile, workers aged between 22 and 29 earning around the median wage saw hourly pay rise by 15% over the same period. By comparison, workers in their thirties experienced growth of only 4%.
These figures suggest that younger employees have benefited more from recent wage increases than many older workers.
The Economic Factors Behind Gen Z Earnings Growth
Several economic trends have helped support stronger earnings among younger workers.
First, unemployment levels have remained relatively low compared with the years following the financial crisis. This has given workers greater bargaining power when negotiating salaries.
Next, many industries have faced recruitment shortages. Sectors such as healthcare, technology, hospitality, and logistics have all struggled to fill vacancies.
As a result, employers have raised wages to attract new talent. Younger workers entering these sectors have often benefited from higher starting salaries and better employment opportunities.
In addition, remote and flexible working arrangements have expanded job options for many people. This has increased competition among employers and contributed to stronger wage growth.
Challenges That Could Slow Gen Z Earnings Growth
Despite the positive findings, economists caution that several risks remain.
Rising inflation continues to place pressure on household finances. If prices increase faster than wages, workers may see their spending power decline even if salaries continue to rise.
Energy costs also remain a concern. Ongoing geopolitical tensions and global market uncertainty could contribute to higher living expenses in the months ahead.
Furthermore, housing affordability remains a major issue for younger generations. Although wages have improved, many young workers still struggle to save for a deposit or purchase their first home.
These challenges mean higher earnings do not automatically translate into greater financial security.
Why NEET Levels Threaten Gen Z Earnings Growth
Another issue highlighted by the Resolution Foundation is the growing number of young people who are not in employment, education, or training.
Around one million people aged between 16 and 24 currently fall into this category. Economists warn that this trend could create long-term economic problems.
Young people outside the workforce are unable to benefit from rising wages and career progression. If these numbers continue to increase, the gap between employed and unemployed young people may widen further.
The thinktank argues that tackling youth inactivity should become a national priority. Supporting more young people into work could strengthen future economic growth and improve living standards.
What Gen Z Earnings Growth Means for the Future
Finally, the report provides cautious optimism about the future of young workers in the UK.
For much of the past decade, concerns focused on whether younger generations would experience lower living standards than their parents. The latest earnings data suggests that may not be the case.
Strong wage growth, higher minimum pay rates, and increased demand for workers have helped create a more favourable environment for many Gen Z employees.
However, maintaining this progress will require stable economic conditions, continued investment in skills, and policies that support employment opportunities. Employment and labour market.
While challenges remain, the current data shows that Gen Z workers are beginning their careers from a stronger financial position than many millennials experienced. If these trends continue, younger workers could enjoy greater earning potential throughout their working lives.
The Importance of Gen Z Earnings Growth
The latest findings offer encouraging news for Britain’s youngest workers. Gen Z Earnings Growth has outpaced millennials at the same age, reversing years of concern about declining opportunities for younger generations.
Higher wages, minimum pay increases, and strong labour demand have all contributed to this improvement. Yet policymakers must continue addressing inflation, housing affordability, and youth inactivity to ensure these gains are not lost.
For now, the evidence suggests that Gen Z is entering the workforce with stronger earnings prospects than many expected.
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