Executive Summary

Gen Z – those born between 1997 and 2012 – s expected to make up 30% of the US workforce by 2030. As older generations like Baby Boomers and Gen X retire, Gen Z is set to become the driving force behind the labor market, taking center stage in a transformative era marked by this “silver tsunami” of retirements coupled with technological advancements in broadband, cybersecurity, energy, artificial intelligence, and quantum computing. At the same time, the US continues to grapple with workforce shortages: over 6.95 million jobs remain unfilled as of January 2026. Although Gen Z is smaller in size compared to previous generations, their distinct characteristics as the first generation raised in the digital age makes them uniquely positioned to address workforce challenges and drive economic solutions. Modern workforce development programs must empower Gen Z with the tools necessary to thrive in evolving sectors, ensuring the continued advancement of American excellence as the leading economy in innovation and opportunity.

Background 

More than 12 million Americans will be retiring between now and 2027, averaging 11,000 retirements each day. Over the next ten years, Gen Z (the youngest of whom are just entering high school) will surpass Millennials to become the dominant participants in the workforce. This generational transition coincides with rapid technological advancements that are reshaping the labor market, creating new opportunities while replacing traditional roles across various sectors. The 2025 U.S. Energy and Employment Report (USEER) found that the energy sector employed 8.5 million workers in 2024, accounting for 5.4% of all jobs in the U.S. The sector continues to offer high-quality opportunities, with a median wage of $58,810, which is 18.8% higher than the national median. As the United States sets to quadruple nuclear energy capacity by 2050, building the infrastructure to meet these goals requires specialized workers; currently, Nuclear Electric Power Generation employs 57,900 workers, with employers in that subsector anticipating a 2.2% growth in jobs through 2025. 6 Additionally, the Fiber Broadband Association reports that nearly 180,000 workers are needed to complete federally and state-funded broadband networks. 7 US manufacturing, which employs 13 million Americans, is projected to create 3.8 million high-value jobs by 2033, yet faces a potential shortfall of 2.1 million skilled workers by 2030. Recognizing these advancements in technology and shifting labor market trends, employers have been turning to public-private partnerships to equip workers with the adaptable skills vital to remain agile and innovative for future challenges.

To bridge the gap between traditional education and cutting-edge expertise, upskilling initiatives incorporate hands-on learning, mentorship opportunities, and certifications that align with industry standards. The Workforce Innovation and Opportunity Act (WIOA), our nation’s largest federal investment law for workforce development, was designed to strengthen workforce development systems and increase labor participation through skills training and employment services. During Program Year 2023 (July 1, 2023 through June 30, 2024), WIOA served nearly 2.7 million participants. In the 118th Congress, its reauthorization through the “A Stronger Workforce For America (ASWA) Act” passed the House of Representatives with strong bipartisan support, but narrowly fell short in the Senate. Despite this setback, Congress has not given up on making WIOA a priority this term, with renewed bipartisanship interest fueling recent discussions in both chambers to strengthen workforce development and address labor market challenges. During a Higher Education and Workforce Development Subcommittee hearing in March 2025, Subcommittee Chairman Burgess Owens (R-UT-4) emphasized the need to reform WIOA to address skills gaps and fill the nearly 8 million job openings. Similarly, Senate Health, Education, Labor, and Pensions (HELP) Committee Chair Bill Cassidy (R-LA) and Ranking Member Bernie Sanders (I-VT) both publicly expressed their commitment to reauthorizing WIOA at their first committee organizing meeting at the start of the 119th Congress. As the job market shifts toward digital occupations in emerging sectors such as AI, quantum technology, and energy, the future workforce will not only require digital literacy and access, but also the tools and training necessary to support themselves, their families, and the broader economy.

Challenge 

While WIOA has made strides in addressing employment challenges, its focus on traditional training programs and credentialing pathways has not kept up with emerging demands in the digital age, especially with the unexpected challenges brought by disruptive events like the COVID-19 pandemic. The workforce landscape has rapidly evolved since WIOA was first enacted in 2014. With the resurgence of nuclear energy, alongside groundbreaking advancements in artificial intelligence and quantum computing, employers face difficulties in recruiting skilled workers while existing workers struggle to meet the demands of increasingly tech-centric roles. A recent Gallup survey found that, while Gen Z is apprehensive about AI, they also recognize its benefits with improving efficiency and learning: 66% of GenZers believe that AI can help them work faster, and 52% of Gen Zers said schools should be required to teach students how to leverage AI. Gen Z is already starting to embrace AI, but current workforce development systems lack the training models and resources to provide the necessary skills for these new technologies. Furthermore, the ongoing workforce shortages make it especially important to harness Gen Z’s unique characteristics and tailor programs specific to their needs. Approximately five million Gen Zers are considered opportunity youth–individuals between the ages of 16 and 24 who are neither enrolled in school nor participating in the labor market–and remain the hardest to reach segment of the population. WIOA falls short in funding targeted services for individuals like opportunity youth to complete high quality training programs, with barriers such as access to reliable broadband connectivity, transportation, and childcare limiting program participation. Without robust investments to close the skills gap and reach all Gen Zers, including opportunity youth, the ongoing workforce shortage will only be exacerbated.

Solution 

Addressing workforce gaps requires a coordinated effort among government, industry, and educational institutions to ensure Generation Z is prepared for the jobs of tomorrow. Prioritizing workforce development involves expanding training programs through greater investment in apprenticeships, technical training, and digital skill development, equipping Gen Z with the expertise needed for in-demand careers. Strengthening public-private partnerships between educational institutions, industry leaders, and government agencies will create clear career pathways in emerging fields like broadband, nuclear energy, artificial intelligence, and quantum computing. Incentivizing STEM education through scholarships, loan forgiveness, and grants will further develop a robust talent pipeline, while AI literacy and reskilling initiatives will prepare workers to collaborate with AI tools rather than risk being displaced by them. To ensure equitable access to high-growth opportunities, workforce development programs must also prioritize underrepresented communities, ultimately strengthening the nation’s workforce pipeline.

Policy Recommendations 

Federal investments are crucial for funding high quality training programs that prepare Gen Z to navigate the labor landscape, ensuring they remain competitive in the ever-evolving job market. Developing skills-based programs that include Science, Technology, Engineering, and Mathematics (STEM) requires a collaborative approach involving educational institutions, community-based organizations, industry leaders, and government agencies. Strengthening these private-public partnerships plays a vital role in bridging skills gaps resulting from access barriers like the digital divide, with efforts like AT&T’s $5 billion commitment to expand their Connected Learning Centers that provide free and low-cost digital access and broadband to underserved communities serving as a model for industry leadership. Along with connecting individuals to broadband, programs like DigLit 2.0 in the City of Boston have enhanced digital literacy by equipping job training and education programs with digital tools, benefiting 3,500 students annually and creating a library of over 70 instructional routines. The city’s exemplary partnership with the nonprofit organization World Education, along with a federal grant from the Department of Labor, has led to an expansion that supports 20 additional Boston-based organizations. Harnessing the power of collaboration between public and private stakeholders opens a range of resources, expertise, and innovation to build robust workforce development initiatives centering worker readiness in the digital age.

Policy Recommendations 

To prepare Gen Z for the future of work and maintain U.S. leadership in key tech sectors, ZETA urges policymakers to expand support for technical education, AI literacy, and industry-aligned training programs. This includes funding for workforce development, tax incentives for reskilling, and greater access to alternative education programs like coding boot camps and apprenticeships. WIOA must be reauthorized with provisions tailored around these supportive solutions while also being responsive to Gen Z’s unique characteristics not previously considered when the legislation was first enacted more than a decade ago. Among the amendments proposed is the bipartisan “Digital Skills for Today’s Workforce Act”, which would amend WIOA by adding a grant program to help workers build digital skills and improve access to stable careers. ZETA urges Congress to pass the “Digital Skills for Today’s Workforce Act,” along with similar skills-focused legislation such as the “Cybersecurity Hiring Modernization Act”, as amendments to WIOA’s reauthorization. Leadership from the Senate HELP Committee and the House Education and Workforce Committee must join forces to drive the markup of WIOA, ensuring meaningful progress in modernizing workforce development programs to unleash Gen Z’s potential.