Are your Gen Z employees struggling more or just saying so more?

It is apparent that employers may not particularly favor young employees right now: More than a third of American managers are actively avoiding hiring recent college graduates, opting instead for older candidates. Nearly half say they would take an overqualified older hire just to avoid the overhead. Three in four managers say Generation Z is harder to work with than any previous cohort they have managed.

Research by FranklinCovey in 2025 found that almost 40 percent of managers would rather delegate a task to an artificial intelligence tool than work through it with a Gen Z employee.

That is a striking signal about where employer confidence in the youngest generation of workers currently stands.

The data from those workers own perception tells a different story. Seventy-four percent of Gen Z employees said they had needed to take time off work due to stress in the past year, but only 43 percent actually did, according to Deloitte's 2025 global survey of more than 23,000 respondents. Peak burnout now hits Gen Z workers at 25, compared with 40 for older generations. Only 23 percent of Gen Z adults rate their mental health as "excellent," against 31 percent of Gen X and 39 percent of Baby Boomers, according to Gallup's 2025 data. That figure has declined by roughly 15 points since the pandemic began.

Mental health-related absences have increased approximately 33 percent since 2020, with workers aged 18 to 34 accounting for a disproportionate share of that rise.

John Burn-Murdoch, the Financial Times's chief data reporter, published an analysis this week that offers a way to understand why neither account is wrong -- and why most workplace mental health programs are failing to close the gap between them.

A Diverging Signal

Working across American, British and international data, Mr. Burn-Murdoch found that the share of young people reporting a mental health problem has risen sharply over the past decade. The share who say that condition limits their day-to-day functioning has barely moved.

In England, one measure has risen steeply while the other stayed nearly flat. He found the same divergence in United States data.

When Americans were asked whether someone experiencing "broad happiness but occasional moments of worry, frustration or loss of confidence" has a mental illness, more than half of young Americans now say yes. Fifteen years ago, one in five said the same. The views of older Americans have not changed.

The rise in reported mental health problems is also higher among those who identify as politically left-leaning than right-leaning. But that gap disappears entirely when the same question is asked about physical health. The divergence, Mr. Burn-Murdoch concluded, is not about underlying health. It is about how different groups label the same experiences.

This does not mean younger workers are fine. Hospitalization rates for self-harm among teenage girls and young women have risen sharply across multiple countries, including the United States -- a concrete signal that exists entirely independent of how people choose to describe their feelings. That is real distress at the severe end of the spectrum.

The trouble is that most of the caseload employers are managing sits somewhere between that extreme and ordinary working life.

The Numbers at Work

Mental health-related leaves increased 33 percent year over year in 2023, with over 60 percent of HR leaders reporting increases in the past year, according to Spring Health's 2026 Workplace Mental Health Annual Report. Presenteeism -- showing up to work without being productive because of poor mental health -- now affects 47 percent of American employees. The World Health Organization estimates that depression and anxiety cost the global economy $1 trillion a year in lost productivity.

The generational pattern is specific in ways that matter for employers.

One in five Gen Z men have taken mental health leave -- a higher rate than any other generation of men now in the workforce. Gen Z men and women are taking mental health leave at the same rate, a significant departure from historical patterns where women have been considerably more likely to seek support.

Gen Z men are also 35 percent less likely to return to work after taking mental health leave than women of the same age, according to a 2026 survey by The Standard. That is a retention risk that most organizations are not measuring.

Organizations with comprehensive mental health programs see roughly 30 percent fewer disability claims than those without, according to the Center for Workplace Mental Health. The W.H.O. puts the return on mental health investment at $4 for every $1 spent.

The Labeling Problem

Some portion of the rise in reported mental health problems reflects a genuine deterioration in the psychological well-being of young people. Some portion reflects something different: a generation that has come to believe, sincerely and not unreasonably, that ordinary difficulty -- a difficult week, a critical manager, financial anxiety, the uncertainty of early career -- constitutes a diagnosable mental health condition.

Read next: "Toughen up, buttercup": Michelle Obama talks Gen Z

Mr. Burn-Murdoch describes this dynamic as "systems medicalisation." Inflexible binary frameworks in workplaces and benefits systems force employees with any level of difficulty -- whether serious or mild, chronic or temporary -- into a disability classification that rarely fits their actual situation. If the only path to support runs through a formal mental health claim, more employees will file formal mental health claims.

The result is a system that generates some of the caseload it is supposed to treat.

Stigma compounds the problem in a specific way. Forty-six percent of American employees worry about losing their job if they disclose a mental health concern at work, according to Mind Share Partners' 2025 Mental Health at Work Report. Eighty percent of employees with mental health conditions do not seek help at work at all.

The people who most need clinical support are not accessing it. Meanwhile, the pipeline of adjustment disorder claims -- stress responses to life transitions that are real, but not clinical -- keeps growing.

What the Generation Actually Wants

The assumption that Gen Z has simply checked out is not borne out by the ambition data. Eight in ten Gen Z workers say their goal is to reach the top of their field -- a higher share than either millennials or Gen X expressed at the same career stage, according to an analysis of SurveyMonkey research reported by HRD. More than half respond to messages sent outside office hours immediately.

Corey Seemiller, a professor of Leadership Studies at Wright State University and co-author of "Generations in the World of Work" (Routledge, 2025), found in her research that Gen Z responds best to managers who set clear expectations and explain their reasoning, rather than those who rely on hierarchy or assumption.

To be sure, the frustrations managers report are not imaginary. A generation that entered the workforce largely in isolation, without the informal social learning that office environments have always quietly transmitted, arrived with real gaps in the soft skills that previous cohorts absorbed without anyone needing to name them. PwC U.K. recognized this directly when it launched a dedicated resilience training program for its 2025 graduate cohort.

But the managers choosing older hires to sidestep the difficulty are making a rational short-term decision and an expensive long-term one. Gen Z will make up roughly 30 percent of the American workforce by 2030. The organizations learning now how to manage this cohort effectively will have a structural advantage over those waiting for the problem to resolve on its own.

Beyond the Benefits Package

The clinical infrastructure matters. Early intervention for anxiety disorders reduces absenteeism by roughly 40 percent, according to consistent research. Only 11 percent of American workplaces require mental health training for managers, despite evidence that such training meaningfully improves outcomes.

But the gap that training and therapy benefits cannot close is a cultural one.

The productivity loss difference between employees who feel supported by their workplace culture and those who do not runs to roughly 28 days per employee per year in workforce mental health research. That gap is not driven by how many sessions an employee completes through their EAP. It is driven by whether managers set clear expectations, give feedback before the annual review, and connect the hard assignment to the longer arc of the employee's development.

Michelle Obama, speaking at the SXSW festival in London this year, described adversity at work as a curriculum -- the difficult boss, the tedious assignment, the raise that did not come when an employee believed it was earned. The observation is correct. A curriculum teaches only when the student can see what they are building toward. Without that structure, the same experience produces a mental health claim and a resignation letter.