Climbing the Ladder or Burning Out? Employers Miss Gen Z’s Overwork Problem

Overview

Employees are showing clear signs of burnout—even as many employers believe workloads are balanced and work-life initiatives are improving. According to the State of Workplace Report 2025, 71% of employers say employees work the “right number of hours,” only 56% of employees agree. Burnout is rising fastest among younger generations, with Millennials and Gen Z reporting steep jumps in overwork and after-hours “ladder climbing.”

Key Report Findings:

• Workload disconnect: Nearly 1 in 4 Millennials say they work too many hours—more than double what employers perceive.
• Generational strain: Gen Z reports the lowest work-life balance (5.0 on a 7-point scale), while Baby Boomers report the highest.
• After-hours pressure: Half of Gen Z employees say they work late to advance their careers, but only 34% of employers recognize this.
• Cultural mismatch: Employers believe perks and teamwork initiatives improved in 2025, but employees cite declines in PTO, flexibility, and teamwork.

What small business leaders can do:

• Listen to generational feedback instead of relying on averages.
• Redefine “hard work” around outcomes, not hours.
• Offer real schedule flexibility, not just hybrid days.
• Encourage PTO use and model balanced behavior.
• Train managers to identify early signs of burnout and disengagement.

Bottom line:
Younger workers are signaling burnout through longer hours, lower satisfaction, and weaker connection to leadership—signs employers can no longer afford to overlook.

Burnout is not a new workplace phenomenon, but what is new in 2025 is the widening optimism gap between employers and employees. Leaders believe workloads are largely manageable and that work-life balance is steadily improving. Employees, however—especially Millennials and Gen Z—tell a different story. They report longer hours, more late-night “ladder climbing,” and weaker connections to their teams and managers.

This disconnect matters. For small and midsize businesses (SMBs) with fewer layers of management, underestimating burnout can have an outsized impact on retention, productivity, and employer brand. Understanding where perceptions diverge is the first step toward building a more sustainable workplace.

Employers Think Workloads Are Balanced—Employees Don’t Agree

When asked about workload balance, 71% of employers and 56% of employees say employees are working the “right number of hours.” On the surface, this seems encouraging: both sides are closer than they were a year ago, when only 13% of employees reported working a standard 36–40-hour week, compared with 28% of employers who assumed this was the norm.

But a deeper look reveals trouble brewing. Nearly one in four Millennials (23%) now say they work “too many hours,” a sharp jump from just 7% in 2024. Gen Z isn’t far behind, with 22% reporting overwork, up from 5% the year prior. In other words, younger workers are ringing alarm bells that employers may not be hearing.

For small business leaders, this suggests that “narrowing gaps” in perception may not reflect improved reality but rather shifting averages that mask significant strain within specific employee groups.

The Burnout Generation: Millennials and Gen Z

While overall work-life balance satisfaction is rising, the gains aren’t shared equally. In 2025, 89% of employers report some level of satisfaction—up from 87% last year—and employees also saw a modest improvement, climbing 2 points to 77%.

Generationally, however, the picture is far more uneven. Baby Boomer employers posted the sharpest increase, with over 90% now satisfied with their work-life balance—a striking 16-point jump from 2024. At the other end of the spectrum, Gen Z employees saw the steepest decline. Only 63% report being satisfied in 2025, a drop of five points year over year. Millennials also continue to lag, frequently citing long hours and diminished personal time as ongoing challenges.

The data suggests a generational divide: younger employees feel compelled to prove themselves, logging late nights not because they want to, but because they believe that’s what it takes to advance. Nearly half of Gen Z workers report working after hours specifically to “climb the ladder.” Yet only 34% of employers recognize this dynamic.

This underestimation is risky. Employers who view work outside the standard business hours as a “personal choice” may overlook that may be a sign of overwork, cultural pressure, or unspoken expectations.

Employers Believe They’ve Improved Work-Life Balance—Employees Don’t See It

Employers report strong improvement across every category—especially teamwork (+16%), balance culture (+13%), and workflow management (+13%)—suggesting that organizations believe they’ve meaningfully expanded their work-life balance initiatives. From their perspective, the investment is paying off.

Employees, however, see a more complicated picture. While there are slight gains in habits and overall healthy culture, satisfaction has slipped in core areas: teamwork (-5%), PTO (-3%), and flexibility (-3%). The can lead to a growing disconnect—while employers often see view work-life balance as a success, many employees may still experience its limitations in their day-to-day routines.

For small business leaders, the lesson is clear: what looks like progress on paper may not translate into lived experience. Employees tend to evaluate work-life balance not by new policies or wellness campaigns, but by whether they can genuinely take time off, disconnect outside of regular business hours, and collaborate without feeling stretched too thin.

Off-Hours Work: Choice or Cultural Pressure?

Nearly 60% of employers say employees work outside normal business hours by choice, while fewer than half of employees (46%) agree—down sharply from 58% in 2024. Employees cite other drivers: company culture (29%) and advancement pressure (27%).

Gen Z is again the outlier. Half say they work after business hours to climb the ladder—evidence of cultural signals that hard work must be visible to count. Employers underestimate this by 16 points, assuming ladder-climbing is far less common.

For SMBs, this misalignment is critical. Smaller companies often lack the buffer of large HR departments to monitor burnout. Leaders may mistake visible effort for engagement, when in reality it may be employees pushing themselves unsustainably in hopes of recognition.

The In-Office Disconnect

The office debate adds another layer of strain. Employers are converging on three days in-office as the “sweet spot,” with 26% naming it ideal—up from 21% in 2024. Employees, however, disagree. Only 14% see the three days as optimal, unchanged from last year.

Flexible hours emerge as the strongest incentive for returning to the office. Employees want a choice over when they come in, not just how often. Yet employers consistently overestimate the appeal of perks like team-building events (+18-point gap) and underestimate more practical supports, such as childcare, which Millennials in particular value highly.

Small business leaders should note: cultural perks alone may not enough to bring employees back to the office. Tangible supports and flexibility often carry more weight.

The Connection Gap: Leadership, Managers, and Meaning

Connection is another area where optimism diverges. Employers see strong improvements in employee connectedness across leadership, management, and mission. Employees report the opposite trend.

• Leadership connection: 79% of employers believe employees feel connected to leadership, up 4% from 2024. Employees disagree, with only 64% feeling connected—a 5% decline.
• Manager connection: 45% of employers think employees feel “extremely connected” to their managers, up from 37% last year. Employee responses remain flat at 36%.
• Connection to work: 82% of employers believe employees are connected to their work, up from 77% in 2024. But only 74% of employees agree, down 6 points year-over-year.

This disconnect reveals how employers may equate organizational initiatives with employee buy-in. Employees, however, often evaluate connection based on daily experiences—how much autonomy they have, how fairly workloads are distributed, and whether leadership is transparent.

What This Means for SMB Leaders and HR Teams

For small and midsize businesses, the data provides both a warning and an opportunity. The warning is that leaders may be unknowingly fostering burnout cultures by assuming satisfaction is higher than it is. The opportunity is that smaller organizations can act faster to close perception gaps.

1. Listen Beyond the Averages

While overall numbers may look positive, breakdowns by generation reveal where opportunities may be most acute. Gen Z and Millennials are raising red flags on hours and burnout. SMB leaders should consider pulse surveys, anonymous feedback tools, and open forums to hear directly from employees.

2. Measure Outcomes, Not Inputs

If long hours are seen as the ticket to advancement, employees may sacrifice balance for visibility. Leaders should consider redefining “climbing the ladder” in terms of outcomes—innovation, collaboration, and results—rather than face time or late-night emails.

3. Prioritize Real Flexibility

Flexibility isn’t just remote vs. office—it’s about control over schedules. Flexible hours are the top incentive employees cite for coming into the office. Small businesses can experiment with staggered start times, compressed workweeks, or hybrid schedules tailored to team needs.

4. Revisit Work-Life Balance Programs

Policies alone don’t equal balance. If employees feel discouraged from taking PTO or pressured to respond after hours, formal programs won’t matter. HR teams should reinforce that leaders model balanced behavior, encourage time off, and track PTO usage.

5. Strengthen Manager Training

The flat scores on manager connection suggest that frontline leadership may be an area needing further support for development. SMBs should invest in manager development programs, focusing on empathy, workload management, and spotting early signs of burnout.

6. Bridge the Communication Gap

Employers may overestimate the value of perks while underestimating supports like childcare. Regular dialogue with employees can align investments with actual needs, ensuring that resources aren’t wasted on initiatives that fail to move the needle.

Conclusion: The Future of Work Requires Closing the Gap

The story of 2025 is not simply that employees are burnt out—it’s that employers may not fully see it. Optimism among leaders is rising, but employees, particularly younger ones, are signaling distress.

For SMB leaders, the takeaway is not just to acknowledge burnout but to recalibrate how they measure engagement, advancement, and connection. Small companies, with their flatter structures and faster agility, are uniquely positioned to listen carefully, act quickly, and create cultures that sustain—not drain—their people.

Because when it comes to burnout, perception gaps aren’t harmless—they’re warning signs. And the businesses that thrive will be the ones that close those gaps before they become chasms.

*This article draws from the TriNet State of the Workplace 2025 report and reflects TriNet’s perspective based on survey data from over 1,000 participants. The findings offer insights into employer and employee views within the U.S. small business community, highlighting trends in engagement, wellbeing, AI use, and benefits understanding. Data may not represent all industries or regions, and while accuracy is a priority, applicability may vary by organization.

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