The Economic Landscape for Young Adults: A Challenging outlook

Recent findings from the 2025 McKinsey American Opportunity Survey paint a concerning picture for young adults entering the workforce. The study, which surveyed nearly 10,000 Americans, reveals significant disparities in economic opportunity, especially for those aged 18-24, also known as Gen Z. These insights underscore the critical importance of addressing skills gaps and providing extensive career support to ensure a more equitable future.

While ambition remains high, Gen Z faces considerable headwinds. Consider the experiance of Sarah, a recent high school graduate eager to enter the tech industry. Despite her enthusiasm, she found herself struggling to secure even entry-level positions due to a lack of specific technical skills and relevant internship experience. Stories like Sarah’s are increasingly common, reflecting a broader trend of skills mismatches in the current job market.

Unemployment and economic Anxiety Among Gen Z

The McKinsey American Opportunity Survey highlights a concerning trend: the unemployment share [of young workers, ages 18-24] is more than 2.5 times higher than the general population. This elevated unemployment rate underscores the challenges faced by young individuals as they attempt to establish themselves in the professional world. Furthermore, the survey indicates that nearly half (45%) of Gen Z workers express concerns about job stability and financial security, while almost one-third (31%) harbor doubts about their ability to retire comfortably. A significant majority (70%) also believe that homeownership will remain out of reach.

These anxieties are not unfounded. The rising costs of living, coupled with stagnant wages and increasing student loan debt, create a perfect storm of financial uncertainty for many young adults. This situation is further compounded by the perception that traditional career paths are becoming less secure, leading to a sense of unease about the future.

The Skills Gap: A Major Barrier to Employment

One of the most significant obstacles to employment for young people is a perceived lack of skills and experience. According to the McKinsey American Opportunity Survey, nearly 50% of unemployed 18-24 year olds attribute their job search struggles to this deficiency. This highlights the urgent need for targeted training programs and educational initiatives that equip young adults with the competencies demanded by today’s employers.

However, the survey also reveals a strong desire among Gen Z to pursue educational pathways that can enhance their career prospects. In fact, they are 1.5 times more likely than individuals aged 25-54 to seek out education and training opportunities, driven by the potential for increased income. This eagerness to learn and grow represents a valuable asset that can be leveraged to bridge the skills gap and empower young people to achieve their professional goals.

Addressing Diverse Barriers: Gender, Accessibility, and Beyond

The challenges faced by young job seekers are not uniform. A lack of relevant experience disproportionately affects women, who also cite additional barriers such as limited knowledge of job search resources, childcare responsibilities, and physical health concerns. Young men, conversely, more frequently report accessibility issues related to transportation, financial resources, internet access, and housing options.Both genders identify mental health and access to financial support as significant hurdles, while older Americans often point to a lack of time as a barrier to training.

These findings underscore the importance of adopting a holistic approach to workforce progress, one that addresses the diverse needs and circumstances of individual job seekers. For example, providing access to affordable childcare, transportation assistance, and mental health services can significantly improve the employment prospects of young people facing these challenges.

The Plight of Justice-Impacted Individuals

The McKinsey American Opportunity survey also sheds light on the employment challenges faced by individuals with a history of involvement in the justice system.This group is twice as likely to be unemployed compared to the general population, largely due to accessibility barriers such as limited access to technology, transportation, and stable housing.

Compared to the general population, justice-impacted respondents cited these barriers:

• Access to internet ~2.7x more than others
• Access to transportation ~2.3x more than others
• Access to housing 2x more than others
• Access to childcare ~1.6x more than others
• Access to financial support ~1.2x more than others

These statistics highlight the need for targeted interventions that address the specific challenges faced by justice-impacted individuals, such as providing job training, expungement services, and assistance with housing and transportation.

Goodwill’s role in bridging the Opportunity gap

Organizations like Goodwill Industries International are playing a crucial role in addressing the opportunity gap and empowering individuals to achieve economic self-sufficiency. As the largest nonprofit provider of job training and career placement services in North America, Goodwill is uniquely positioned to connect job seekers with the resources and support they need to succeed.

The Goodwill Opportunity Accelerator® is a proven workforce development framework that equips job seekers with the resources needed to pursue and advance their careers by connecting individuals to career pathways, job training, certifications, apprenticeships and mentorships for continued career growth.

Each of the Goodwill network’s 153 local nonprofit organizations provide job training and support services based on community needs. Every single day, Goodwill helps more than 350 people find jobs.

According to Steve Preston, president and CEO, of Goodwill industries International, the biggest roadblock for today’s youth in landing good jobs isn’t a lack of ambition—it’s the lack of skills, credentials and experience needed to make them appealing to employers. To give people a fair shot at the American Dream,there is a critical need to provide skills training and career navigation,especially to young people who will help shape and power the future workforce.

Preston also added, Investing in overlooked job seekers, such as young people without college degrees and justice-impacted individuals, will help close talent gaps across many of our most vital sectors and help businesses to better thrive and prosper over the long term.

Breaking the Low-Wage Cycle: The Importance of Career Coaching

Providing career coaching and navigation to young people at the beginning of their career journeys is essential for breaking the cycle of low-wage work. Data from the Brookings Institute reveals that only 43% of workers in low-wage occupations leave their jobs within a 10-year period, and their chances of advancement decrease with each passing year. By their tenth year, the likelihood of escaping low-wage work drops to a mere one percent.

This underscores the importance of early intervention and ongoing support to help young people identify their strengths, explore career options, and develop the skills and networks necessary to achieve upward mobility. Mentorship programs, career counseling services, and access to professional development opportunities can all play a vital role in empowering young adults to chart a course toward a more fulfilling and financially secure future.

The Evolving Economic Landscape for Gen Z

The economic challenges confronting Generation Z (born 1997-2012) are multifaceted. A 2023 survey by the New York State Society of CPAs revealed that 83% of Gen Z workers consider mentorship crucial for their career progress, yet only 52% have access to such guidance.([nysscpa.org](https://www.nysscpa.org/news/publications/nextgen/nextgen-article/gen-z-workers-crave-mentorship-and-training-survey-finds-092823?utm_source=openai)) This gap underscores the pressing need for structured mentorship programs to equip young adults with the skills and confidence required in today’s competitive job market.

Addressing the Skills Gap: A Pathway to Employment

The disparity between the skills possessed by young adults and those sought by employers remains a critically important barrier. Nearly 50% of unemployed individuals aged 18-24 attribute their job search challenges to this mismatch. To bridge this gap,initiatives like Goodwill Industries International’s LifeLaunch: Ignite program are expanding to provide holistic career advancement services for young adults with prior justice involvement. ([prnewswire.com](https://www.prnewswire.com/news-releases/goodwill-builds-skills-and-expands-career-opportunities-for-young-adults-301438591.html?utm_source=openai)) Such programs offer tailored training and support, enhancing employability and fostering economic self-sufficiency.

Inclusive Hiring Practices: Opening Doors for All

Inclusive hiring practices are essential for integrating justice-impacted individuals into the workforce. Employers are increasingly recognizing the value of diverse backgrounds and experiences.By revising job descriptions,reevaluating background checks,and providing training to reduce bias,companies can tap into a broader talent pool. This approach not only promotes social equity but also drives innovation and growth within organizations. ([opportunityarchitects.org](https://www.opportunityarchitects.org/post/best-workforce-development-strategies-for-justice-impacted-individuals?utm_source=openai))

Mentorship and Support Networks: Catalysts for Success

Mentorship plays a pivotal role in the professional development of young adults. A 2023 survey by the New York State Society of CPAs found that 83% of Gen Z workers consider mentorship crucial for their career development, yet only 52% have access to such guidance. ([nysscpa.org](https://www.nysscpa.org/news/publications/nextgen/nextgen-article/gen-z-workers-crave-mentorship-and-training-survey-finds-092823?utm_source=openai)) Establishing robust mentorship programs can provide guidance, encouragement, and practical advice, helping individuals navigate workplace challenges and build confidence. Support networks, including colleagues, human resources professionals, and community organizations, further enhance the chances of long-term success for justice-impacted individuals.([opportunityarchitects.org](https://www.opportunityarchitects.org/post/best-workforce-development-strategies-for-justice-impacted-individuals?utm_source=openai))

Government Initiatives: Investing in Workforce Development

Government initiatives are increasingly focusing on preparing justice-involved youth and young adults for workforce success. in January 2023, the U.S. Department of Labour awarded $33 million in Growth Opportunities grants to programs in 11 states, aiming to help justice-involved young people develop leadership skills, receive mentorship, and access education and training. ([dol.gov](https://www.dol.gov/newsroom/releases/eta/eta20230110?utm_source=openai)) Thes investments are crucial for creating pathways to stable employment and economic mobility for underserved communities.

Proactive Strategies: Building career pathways for Justice-Impacted youth

Organizations like NextGen Policy are pioneering efforts to build career pathways for formerly incarcerated young adults. in June 2024, NextGen Policy received a $1.78 million grant to provide complete programs that prepare participants for success in various industries,including manufacturing,healthcare,and information technology. ([nextgenpolicy.org](https://www.nextgenpolicy.org/1-78-million-groundbreaking-grant-awarded-to-nextgen-policy-to-build-career-pathways-for-formerly-incarcerated-young-adults/?utm_source=openai)) These programs emphasize personalized career planning, certification programs, on-the-job training, and mentorship, addressing the unique challenges faced by this community.

Did You Know?

Nearly 75% of formerly incarcerated individuals are unemployed a year after release.([nextgenpolicy.org](https://www.nextgenpolicy.org/1-78-million-groundbreaking-grant-awarded-to-nextgen-policy-to-build-career-pathways-for-formerly-incarcerated-young-adults/?utm_source=openai))

Pro Tips for Employers

• Implement fair chance hiring policies to provide opportunities for justice-impacted individuals.
• Offer mentorship programs to support the professional growth of young adults.
• Collaborate with community organizations to access a diverse talent pool.

FAQ

What are fair chance hiring policies?

Fair chance hiring policies are practices that provide individuals with criminal records an equal opportunity for employment, focusing on their qualifications rather than past convictions.

How can mentorship programs benefit young adults in the workforce?

Mentorship programs offer guidance, support, and practical advice, helping young adults navigate workplace challenges and advance in their careers.

What role do community organizations play in workforce development?

Community organizations provide training, resources, and support to individuals, especially those from underserved backgrounds, facilitating their integration into the workforce.

Call to Action

To contribute to bridging the opportunity divide,consider implementing inclusive hiring practices,supporting mentorship programs,and collaborating with community organizations. Together, we can create a more equitable and prosperous workforce for all.