A generational divide over workplace burnout has less to do with work intensity and more to do with diminished expectations for career rewards, according to business author and New York University professor Suzy Welch. The 66-year-old from Portland earned her MBA as a Baker Scholar from Harvard Business School and spent seven years as a management consultant at Bain & Co. before joining Harvard Business Review in 2001, serving as editor-in-chief. Speaking on the July 24 episode of the Masters of Scale podcast, Welch argued younger workers face the same demanding schedules as previous generations, but lack the fundamental belief that hard work will lead to meaningful advancement.

Welch said this insight emerged from a conversation she had with a 25-year-old freelance worker who asked Welch to create more content about worker fatigue among young people because her friends were “just so burnt out.” When Welch told this worker she used to work “seven days a week” at that age and loved the work—and would’ve done more of it if she could—the young woman offered a striking rebuttal: “But you had hope.”

“And I did have hope. We all did have hope,” Welch told Masters of Scale host Jeff Berman. “We believed that if if you worked hard you were rewarded for it. And so this is the disconnect.”

A crisis of hope for young people, backed by data

Welch’s observations align with extensive research documenting unprecedented levels of workplace stress among younger generations, causing them to miss work as a result of physical and mental tolls. According to a 2024 Gallup poll, just 31% of staffers under age 35 say they’re “thriving,” while about 22% of staffers under 35 report feeling lonely.

“I think the distance between people is greater than it ever has been before,” Jim Harter, Gallup’s chief scientist of workplace and wellbeing, previously told Fortune. “When people become more distant physically, you become more mentally distant. That’s what’s happened with younger workers.”

Millennials are in a particularly bad spot, broadly speaking. About 66% of millennials report moderate or high levels of burnout, according to a recent report from Aflac.

“One possible explanation for the higher levels of burnout among millennials could be their unique career pressures and expectations,” the report said, which includes “more demanding work environments than other generations, defined by constant connectivity, high performance expectations and a competitive job market.” Millennial workers are also part of the “sandwich generation,” taking care of both children and their aging parents. According to a Principal Financial report, more than 60% of workers who juggle both responsibilities worry about burnout.

The context for this burnout crisis that young people are being forced to navigate multiple world-altering crises all at once: climate change, political instability, ongoing effects of the COVID-19 pandemic, economic uncertainty, and international conflicts like the Russia-Ukraine war. The psychological impact is profound and measurable: Research shows pandemic-related and climate-related distress are linked to more depression and anxiety symptoms and reduced health-related quality of life, while war-related distress was associated with greater anxiety. Notably, according to Harvard researchers, nearly half (45%) of young adults between 18 to 25 think their mental health is harmed by an overall “sense that things are falling apart.”

The sense of powerlessness—to push back against climate change, to deal with grapple with effects of the political environment like diminished public health and gun violence, and most notably to make enough money to support lifestyles, family, housing, and a future—has led to an erosion of institutional trust. Unlike baby boomers who embraced existing institutions to get rich and live a comfortable life, the younger generations do not feel that institutions—which are perceived as cumbersome, hierarchical, and a source of inequality and discrimination—can improve their situation. When combined with the economic realities Welch identified, where hard work no longer guarantees advancement, this helps explain why more than 50% of young people fear they will be poorer than their parents during their lifetime, according to Leger’s annual Youth Study.

The economic reality

Unlike previous generations who could reasonably expect homeownership and financial security through steady employment, younger workers face structural barriers that have fundamentally altered career prospects.

“Gen Z thinks, ‘Yeah, I watched what happened to my parents’ career and I watched what happened to my older sister’s career and they worked very hard and they still got laid off,'” Welch said on the podcast.

Student debt represents a significant burden, with Gen Z paying an average of $526 monthly toward loans—nearly double the overall average of $284, according to Empower. Housing costs compound these pressures, having increased 121% from 1960 to 2017 while median household income rose only 29%. Currently, 87% of Gen Z and 62% of millennials cannot afford to purchase homes.

Employment challenges begin immediately after graduation. About 58% of people who graduated last year are still looking for full-time work, according to a Kickresume report, compared to just 25% of previous generations. Only 12% of Gen Z secures full-time employment by graduation, versus 40% of earlier graduates. Those who find work earn an average of $68,400 annually while carrying approximately $94,000 in personal debt, as Fortune previously reported.

The generational divide has significant economic implications, with workplace burnout costing businesses $322 billion annually in lost productivity, according to Gallup, and generating healthcare costs between $125 billion and $190 billion. As Gen Z’s role in the global workforce continues to grow and evolve, Welch’s insight about hope provides a framework for understanding why traditional approaches to workplace stress may prove insufficient for younger U.S. workers.

You can watch the full Masters of Scale episode featuring Welch below:

For this story, Fortune used generative AI to help with an initial draft. An editor verified the accuracy of the information before publishing.

Suzy Welch says Gen Z and millennials are burnt out because older generations worked just as hard, but they ‘had hope’