The Gen Z vs Millennial Salary Gap: Which Generation Is Actually Earning More at Each Career Stage?

The Starting Line: Who’s Actually Winning Out of the Gate?

The salary conversation between Gen Z and Millennials starts with wildly different expectations and realities.

Starting Salary: Expectations vs Reality

Generation	Expected Starting Salary	Actual Starting Salary	Expectation Gap
Gen Z (2025)	$101,500	$68,400	-$33,100 (-32.6%)
Millennials (2019)	$57,964	$47,000	-$10,964 (-18.9%)

According to ZipRecruiter data from 2025, Gen Z college graduates expect to earn $101,500 in their first job, but the reality is a stark $68,400 average starting salary. That’s a brutal $33,100 gap between dreams and paychecks.

Compare that to Millennials, who entered the workforce with more modest expectations. In 2019, Millennial college students expected to make $57,964 right out of school when the actual average was $47,000. While both generations faced expectation gaps, Gen Z’s disconnect is nearly three times larger.

Interview Guys Tip: Your first salary matters more than you think. Research from the Federal Reserve Bank of New York shows your first 10 years in the labor market likely shape your lifetime earning potential. Negotiate hard at the start.

Current Average Earnings by Generation

But here’s where it gets interesting. The average Millennial income in 2025 hovers around $4,500 to $5,000 per month, which works out to roughly $54,000-$60,000 annually. However, U.S. Census Bureau data places the average Millennial salary at $71,566 per year.

Age Group	Generation	Average Annual Salary	Monthly Income
18-28	Gen Z	$68,400	$5,700
28-43	Millennials	$71,566	$5,964
44-59	Gen X	$60,998	$5,083

The wide range in Millennial earnings reflects where they are in their careers. Older Millennials (now in their early 40s) have had time to climb the ladder, while younger Millennials are still establishing themselves.

The 5-Year Mark: Career Momentum Starts to Differentiate

Five years into your career is when the real salary differences start to show up.

Job Tenure & Salary Growth: First 5 Years

Generation	Average Job Tenure (Years)	Average Raise When Switching Jobs	Job-Hopping Rate
Gen Z	1.1 years	29.7%	83% identify as job-hoppers
Millennials	1.8 years	20%	50% job-hop regularly
Gen X	2.8 years	~15%	33% job-hop
Baby Boomers	2.9 years	~10%	23% job-hop

For Gen Z, those five years look dramatically different than they did for Millennials. Gen Z’s average tenure in the first five years of their career is just 1.1 years per role, significantly shorter than Millennials at 1.8 years, Gen X at 2.8 years, and Baby Boomers at 2.9 years.

This job-hopping strategy might actually be paying off. When changing jobs, Gen Z workers netted a 29.7% raise on average, while Millennials typically racked up a 20% jump. By constantly moving, Gen Z is accelerating their earning potential in ways Millennials didn’t.

About 83% of Gen Zers identify as “job-hoppers,” and 75% switch to a new role before ever getting promoted. This isn’t disloyalty. It’s strategy. Why wait for a 3% annual raise when you can jump ship for a 30% bump?

Interview Guys Tip: If you’re not getting promoted or seeing significant raises, it might be time to explore opportunities elsewhere. The data shows job-hoppers earn substantially more than those who stay put, especially in your first decade of work.

The Recession Impact on Millennials

For Millennials at the five-year mark, the picture was different. Many hit this milestone during or right after the Great Recession. Prior to the 2008 recession, Millennials earned around $3,640 per month ($43,700 annually), but two years after the recession hit, those who landed jobs earned an average monthly income of only $1,910 ($23,000 per year). That’s a devastating drop that many Millennials spent years recovering from.

The 10-Year Reality Check: Who’s Actually Ahead?

A decade into your career is when the compounding effects of your early decisions really show up.

The Federal Reserve Bank of New York found that the median wage earner doesn’t see earnings growth at all after age 35, while the top 10% of lifetime earners stand to realize a 127% increase in pay between the ages of 25 and 55. This means your first decade is absolutely critical.

Top Millennial Earning Markets (10-Year Mark)

City	Median Millennial Household Income	Premium vs All Ages
Sunnyvale, CA	$234,577	+29.6%
Santa Clara, CA	$216,088	+19.6%
San Mateo, CA	$201,857	+24.5%
Berkeley, CA	$146,987	+41.7%
Jersey City, NJ	$143,500	+42.0%

For Millennials hitting the 10-year mark now, the numbers are mixed. The median Millennial household earns $143,500 in Jersey City, $146,987 in Berkeley, and over $200,000 in Sunnyvale, Santa Clara, and San Mateo, California. But these are the winners. Many Millennials are still playing catch-up from recession setbacks.

Gen Z won’t hit their 10-year mark until the 2030s, but early indicators suggest they might be on track to outpace Millennials. Their aggressive job-hopping strategy, combined with higher side hustle income, could mean Gen Z reaches higher salary milestones faster than any generation before them.

There’s a catch, though. Real wages have fallen 7.6% since 2006, and Millennials who had career delays will not reach their peak earning levels until later in life. Gen Z faces the same inflation pressures that are making every dollar worth less.

The Side Hustle Salary Multiplier: Gen Z’s Secret Weapon

Here’s where Gen Z might be pulling ahead in total earnings: side hustles.

Side Hustle Income by Generation

Generation	% With Side Hustle	Average Monthly Side Income	Annual Side Income	Total Combined Income*
Gen Z	48%	$958-$1,505	$11,496-$18,060	$79,896-$86,460
Millennials	44%	$1,119	$13,428	$84,994
Gen X	33%	$751	$9,012	$70,010
Baby Boomers	23%	$561	$6,732	$47,732

*Total Combined Income = Average salary + side hustle income for those with side hustles

55% of Gen Zers and Millennials have a side hustle, with Gen Zers earning $1,505 per month on average and Millennials earning $1,119 per month. That’s an extra $18,060 per year for Gen Z and $13,428 for Millennials.

The Total Income Calculation

Let’s do the math. If a Gen Z worker earns $68,400 in their main job plus $18,060 from side hustles, their total income is $86,460. A Millennial earning $71,566 plus $13,428 from side hustles brings in $84,994. Suddenly, Gen Z isn’t behind at all when you look at total income.

Nearly half (48%) of Gen Z have a side gig, the highest percentage of any generation, followed by 44% of Millennials. But it’s not just about the percentage. It’s about how they’re using that income.

Gen Z leads the shift in investing side hustle proceeds, with 24% investing their side earnings compared with 14% overall. While Millennials might have more traditional career stability, Gen Z is building financial resilience through diversification.

Popular Side Hustle Income Sources

The types of side hustles differ too:

• Content Creation (YouTube, TikTok, Instagram): $733/month average
• Freelancing (Design, writing, marketing): $500-$1,000/month
• E-commerce (Etsy, eBay, Amazon): $400-$800/month
• Delivery Services (Food, groceries): $300-$600/month
• Pet sitting/Babysitting: $300-$500/month

Gen Z content creators on platforms like TikTok, YouTube, and Instagram make around $733 monthly, while the average Gen Z side hustler earns $958 per month across all gig types.

Flexibility vs Salary: The Great Generational Divide

If Gen Z and Millennials were playing poker, they’d be betting on completely different hands. One generation is all-in on salary. The other is betting on flexibility.

What Each Generation Values Most

Priority	Gen Z	Millennials
Would reject job without flexibility	72%	60%
Prioritize work-life balance	77%	75%
Choose benefits over pay raise	N/A	89%
Want hybrid work model	71%	60%
Prefer fully remote	23%	29%
Prefer fully on-site	6%	11%
Expect promotion within 18 months	70%	35%

72% of Gen Z workers have either left or considered leaving a job because their employer didn’t offer flexible work options. Read that again. Nearly three-quarters of Gen Z would walk away from a paycheck over flexibility.

Compare that to Millennials, where the priorities are different but still not salary-focused. 89% of Millennials would choose better benefits over a pay raise. Both generations are rejecting the traditional “take the highest salary” approach, but for different reasons.

Interview Guys Tip: Before you accept a job offer, clarify the flexibility policy in writing. Don’t rely on verbal promises. Get the remote work policy, flexible hours, and PTO structure documented in your offer letter.

The Flexibility Factor

For Gen Z, flexibility isn’t a perk. It’s a requirement. 71% of Gen Zers prefer a hybrid workplace model, with only 6% wanting fully on-site work and just 23% preferring fully remote roles. They want options, not mandates.

Millennials, meanwhile, have shifted their focus to comprehensive benefits. Strong benefit offerings like PTO, parental leave, flexible work schedules, and better healthcare options are connected with employees staying at companies past the five-year mark.

What “Financial Success” Means

The salary expectations also differ wildly when asked what they need to feel “financially healthy”:

Generation	Salary Needed to Feel Successful	Net Worth Needed
Gen Z	$587,797	$9,469,847
Millennials	$270,214	$3,500,000 (est.)
Gen X	$150,000	$2,000,000 (est.)
Baby Boomers	$99,874	$1,049,172

This isn’t entitlement. It’s math driven by skyrocketing rent, student debt, and inflation that has pushed living costs to record highs. Gen Z is responding to the reality of $2,000 studio apartments and $8 avocados.

The Real Winner? It Depends on What You’re Measuring

So who’s actually earning more? The answer is maddeningly complex.

The Complete Earnings Picture: Gen Z vs Millennials

Metric	Gen Z	Millennials	Winner
Average W-2 Salary	$68,400	$71,566	Millennials
Average Side Hustle Income	$18,060/year	$13,428/year	Gen Z
Total Combined Income	$86,460	$84,994	Gen Z
Average Job Tenure	1.1 years	1.8 years	Neither (strategy)
Raise When Job-Hopping	29.7%	20%	Gen Z
Side Hustle Participation	48%	44%	Gen Z
Career Flexibility	72% demand it	60% demand it	Gen Z
Benefits Prioritization	Moderate	89% prioritize	Millennials

If we’re talking pure W-2 salary, Millennials currently edge out Gen Z at most career stages. The average Millennial’s $71,566 beats the average Gen Z graduate’s $68,400 starting salary.

But if we’re measuring total income including side hustles, Gen Z might already be ahead. Add in their $18,060 average side hustle income, and suddenly young Gen Z workers are pulling in $86,460 compared to Millennials’ combined $84,994.

Look at it from a career trajectory perspective, and Gen Z’s aggressive job-hopping strategy could mean they hit six-figure salaries faster than Millennials ever did. Their 1.1-year average tenure means they’re maximizing salary bumps at every opportunity.

Consider benefits and work-life balance as part of compensation, and both generations are winning in different ways. Gen Z’s flexibility might not show up on a pay stub, but the ability to work from anywhere has real monetary value. Millennials’ comprehensive benefits packages (especially healthcare and PTO) represent thousands of dollars in hidden compensation.

The Bigger Picture

The real insight here is that comparing pure salaries between these generations misses the bigger story. Gen Z is rewriting the rules on how to build wealth. They’re stacking multiple income streams, refusing to accept workplace inflexibility, and changing jobs at a pace that would have gotten Millennials labeled as “disloyal” just 10 years ago.

Millennials, meanwhile, are in their prime earning years but carrying the scars of graduating into the Great Recession. They’ve learned to value stability differently, prioritize benefits over raw salary, and build financial resilience through conservative strategies.

What This Means for Your Career Strategy

Whether you’re Gen Z or Millennial, the data reveals clear strategies for maximizing your earning potential.

For Gen Z, the numbers validate your instincts. Job-hopping works. Side hustles matter. Flexibility isn’t negotiable. But don’t forget to build depth in your skills while you’re bouncing between roles. The hiring managers of 2030 will want to see you can stick around when you find the right fit.

For Millennials, the message is different. You’ve been playing catch-up for years, but you’re finally hitting your stride in your 30s and 40s. Don’t be afraid to make strategic moves now. The data shows job-switchers earn 20% more when they leave, and you’ve got the experience to command premium salaries.

Both generations should embrace multiple income streams. The side hustle economy isn’t going anywhere, and diversifying your income protects you from the job market volatility that both Gen Z and Millennials have experienced firsthand.

The salary gap between Gen Z and Millennials isn’t about who’s “winning.” It’s about two generations navigating completely different economic realities and choosing different strategies to survive and thrive. Gen Z is betting on flexibility, diversification, and rapid movement. Millennials are betting on stability, benefits, and recovery.

Both approaches make sense given their contexts. And both generations are earning their way, just on very different terms.

Want more insights on maximizing your earning potential? Check out our comprehensive guides on salary negotiation strategies, the rise of Gen Z workplace preferences, how to turn your side hustle into career success, understanding the hidden job market, mastering behavioral interviews, and why recruiters are passing on your LinkedIn profile.

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