By Lina Irawan 
The current economic landscape presents a formidable challenge for Generation Z, leading many experts to predict a significantly tougher financial future compared to that enjoyed by Baby Boomers and Generation X. Speaking to Fortune, USAA CEO Wayne Peacock Andrade articulated this stark reality, stating, "I think, unfortunately, our Gen Z’s are not going to be as well off as our boomers and Gen Xers were, for different reasons." He further observed the pervasive nature of these struggles, noting, "You definitely see it among the Gen Z generation, both active duty as well as associate members [and] family." This sentiment underscores a growing concern that the youngest cohort entering the workforce is confronting a "perfect storm" of economic pressures, from stagnant wages and a tight job market to nascent financial literacy and the looming specter of AI-driven job displacement.
Andrade recognizes the "tough" situation many young workers find themselves in, grappling with what he describes as "rock-bottom salaries." Indeed, the data paints a grim picture, suggesting that Gen Z has undeniably "gotten the short end of the stick." In the United Kingdom, for instance, a distressing 2025 analysis from Bloomberg revealed that the average inflation-adjusted salary for working-age graduates is a staggering 30% lower than it was just a decade and a half ago. This isn’t merely a localized issue; similar trends are observable in other developed economies, where the purchasing power of entry-level wages has eroded significantly against a backdrop of persistently rising costs of living, particularly in housing, education, and healthcare. For a generation often burdened with substantial student loan debt, starting their careers with diminished earning potential sets a challenging trajectory for wealth accumulation and financial stability.
Beyond the devaluation of initial earnings, the very act of securing a salaried position has become markedly more difficult. A 2025 Kickresume report highlighted this hurdle, finding that a substantial 58% of recent college graduates were still actively searching for their first job. This contrasts sharply with previous generations, where only about 25% of graduates, including Millennials and Gen Xers, faced similar struggles immediately after completing their education. The reasons for this increased difficulty are multi-faceted, encompassing intensified competition due to a larger pool of graduates, a shrinking number of true entry-level roles as companies increasingly demand prior experience even for foundational positions, and the evolving nature of work itself. The "experience paradox" – needing experience to get a job, but needing a job to get experience – has become a formidable barrier for Gen Z, making their initial foray into the professional world more protracted and frustrating.
However, stagnant paychecks and a lackluster labor market represent only a fraction of the economic squeeze on Gen Z. A precarious understanding of personal finance and the rapid advancement of artificial intelligence are compounding these existing pressures, creating a complex web of challenges that threaten their long-term economic well-being.
Gen Z’s Other Challenges: Financial Inexperience and AI Automation
While every generation has experienced the struggles of being an entry-level worker living paycheck to paycheck, Gen Z’s current economic predicament is particularly dire. Caught between stubborn inflation, high interest rates, and the aforementioned stagnating salaries, many are resorting to borrowing money simply to maintain baseline stability. This reliance on credit, often out of necessity rather than choice, is severely damaging their financial health and setting them back considerably in their journey toward financial independence.
A 2025 FICO report underscored this alarming trend, indicating that Gen Z experienced the steepest annual drop in credit health of any age group since 2020. Their average FICO score slipped three points to 676, a concerning 39 points lower than the national average of 715. This decline is not accidental; it reflects the unique economic pressures Gen Z navigates. As Erin Stillwell, head of payments at Globant, explained to Fortune in 2025, "Gen Z is the first cohort facing high inflation, digital credit, and social-media-driven consumption pressure simultaneously." This confluence of factors creates an environment ripe for "doomspending"—a psychological phenomenon where individuals facing overwhelming economic uncertainty spend impulsively on small luxuries to cope, often exacerbating their financial woes. Furthermore, the accessibility of digital credit, often promoted through social media, can lead to easy accumulation of debt without a full understanding of the long-term consequences.
An underlying, and perhaps more fundamental, issue is the significant gap in financial literacy among young people compared to Gen Xers and Baby Boomers. A 2025 USAA report revealed that nearly half of Gen Z admits they don’t know what affects their credit score, a critical component of financial health. Compounding this knowledge deficit, approximately 62% are so anxious about their financial situation that they actively avoid checking their credit scores altogether. This lack of engagement and understanding can lead to missed opportunities for improvement, perpetuate poor financial habits, and expose them to predatory lending practices. The implications are far-reaching, potentially delaying major life milestones such as purchasing a home, starting a family, or saving for retirement. Recognizing this critical gap, some colleges and employers have begun to step in, offering supplementary financial education. USAA, for example, is actively providing financial education and tools to its more than 38,000 staffers and 14.3 million members as part of its $500 million "Honor Through Action" initiative, aiming to empower the military community with essential financial knowledge. This proactive approach highlights a systemic failure in traditional education systems to adequately prepare young people for the complexities of modern personal finance.
The USAA CEO also points to another seismic shift brewing in the labor force: AI automation. It is no secret that advanced artificial intelligence is rapidly permeating every sector and industry, transforming the nature of work itself. Leaders in the field, such as Anthropic’s CEO Dario Amodei, and global economic figures like IMF chief Kristalina Georgieva, have issued stern warnings about the potential for an AI-driven "jobs apocalypse." The bottom rung of the corporate ladder, historically the entry point for young talent, is already experiencing the brunt of this disruption. Entry-level opportunities have been observed to be stagnating or even declining across most employers, leaving a growing cohort of young, fresh-faced talent struggling to find their footing. The impact is particularly pronounced in tech-centric industries; a 2025 analysis from Pave indicated that the percentage of Gen Z employees aged 21 to 25 at technology companies was cut in half within a mere two-year span. This trend suggests that tasks once performed by entry-level human workers are increasingly being automated or made more efficient by AI, reducing the demand for new graduates in traditional roles.
Andrade elaborated on this concern, explaining, "[Gen Z’s finances] also depends on the jobs that they’re in too." He directly referenced the significant impact of AI on the workforce, noting, "There’s been a lot of layoffs already across the economy, and that certainly impacts people as well." These layoffs, often linked to efficiency gains through automation or economic downturns, disproportionately affect those with less experience and fewer specialized skills, making Gen Z particularly vulnerable. The challenge for this generation is not just finding a job, but finding a job that is resilient to automation and offers opportunities for growth and skill development in an AI-augmented future.
Not All Hope Is Lost: USAA’s CEO Tells Gen Z to Start Running Their Careers
Stepping back and considering the cumulative impact of these statistics, Gen Z has every right to feel disheartened, even dejected. The path ahead appears steeper and more uncertain than for preceding generations. However, USAA’s leader offers a crucial message of hope and empowerment: not all is lost. He posits that budding professionals possess the greatest chance at successful, fulfilling careers when they actively take ownership of their own professional paths and cultivate a proactive mindset.
"This is important to anybody that’s still young and coming up… Nobody cares more about your career than you do," Andrade advises, emphasizing a fundamental truth that often takes years for individuals to internalize. "And to this day I remember that, because what that basically means is that this is up to you." This isn’t an abdication of societal responsibility for economic conditions, but rather a powerful call to personal agency. In an era where traditional career ladders are less defined and employer loyalty is more fluid, the onus is increasingly on the individual to steer their professional development.
Andrade continues, "Other people can help open doors, but you’re the one that has to figure out what it is that you want to do with your life. What are you interested in? And don’t leave it for luck." This proactive approach involves deep self-reflection, identifying genuine interests and aptitudes, and then strategically pursuing opportunities that align with those discoveries. It implies a departure from passively waiting for opportunities to arise and instead actively seeking out learning experiences, networking connections, and skill-building initiatives.
The CEO draws from his own extensive career journey to illustrate this principle. He received this critical piece of advice during his time at the insurance giant American International Group (AIG), his first private-sector job after a distinguished career in several top U.S. government roles. During his initial five years post-career switch, Andrade admits he approached work with "brute force." He didn’t wait for a "golden opportunity" to be handed to him; instead, he took matters into his own hands, succeeding by simply pouring all his energy and dedication into his responsibilities.
"I just had my head down, working hard… I never expected I’d be CEO of anything," Andrade explains. "It was just doing my job right, and doing it well, and doors opened because of that." This anecdote highlights the enduring value of diligence, competence, and a strong work ethic. While external circumstances can be challenging, consistent high performance and a commitment to excellence can create unforeseen opportunities and open pathways that might not be visible from the outset. It speaks to the idea that mastery of one’s current role, coupled with a willingness to learn and adapt, can be a powerful catalyst for career advancement, even in turbulent times.
With nearly 40 years of experience spanning government, insurance, and financial services, the USAA CEO has been a firsthand witness to the profound evolution of the jobs landscape. He has seen economic cycles, technological shifts, and societal changes reshape the nature of work. Critically, he has observed the emergence of the world’s newest and most potent labor market disruptor: artificial intelligence. As this advanced technology continues to fundamentally alter the nature of work, Andrade emphasizes that it is more crucial than ever for Gen Zers to engage in deep introspection about what truly motivates them, what their core values are, and how they genuinely wish to spend their careers.
"I think now, particularly with the onset of artificial intelligence, it’s important for kids—particularly the ones still in college and about to graduate, or [are] thinking about different degrees," he says. This advice is particularly salient given AI’s capacity to automate routine tasks, thereby elevating the importance of uniquely human skills such as creativity, critical thinking, emotional intelligence, and complex problem-solving. For Gen Z, this means not just acquiring technical skills, but also cultivating adaptability, a growth mindset, and a commitment to lifelong learning. Understanding their intrinsic motivations will help them identify career paths that are not only less susceptible to automation but also more personally fulfilling, offering a greater sense of purpose and resilience in an increasingly dynamic and unpredictable professional world. By taking charge of their career narratives, Gen Z can navigate these turbulent waters not as passive recipients of fate, but as active architects of their own futures.