Gen Z wants psychological safety at work—and here’s why it’s good for companies and employees

Psychological safety happens when “people feel comfortable bringing their full, authentic selves to work and are okay with ‘laying themselves on the line’ in front of others,” according to The Center for Creative Leadership. 

It boils down to feeling comfortable challenging the status quo, taking risks, and admitting mistakes without fear of repercussion, says Karishma Patel Buford, a clinical psychologist and the chief people officer at Spring Health. Employees and companies thrive because of it. 

“You can comfortably challenge in any direction, whether that’s up, laterally, [or] down,” Buford tells Fortune, who has implemented workplace strategies to improve psychological safety like leadership training. “Positive intent is being assumed, and you can take risks for a bigger purpose.”

The consensus is that in psychologically safe workplaces, leadership creates a culture of trust so employees feel respected. Corporate leaders bring their team into impactful decisions, are receptive to feedback, and do not publicly shame someone for shortfalls, for example. Not to be mistaken as a cushiony workplace perk, psychologically safe workplaces are vital for the bottom line—improving company culture, mitigating burnout, and retaining workers. 

Why the C-suite should care about psychological safety 

Executives are seeing company well-being, including psychological safety, as a business interest. This comes as Gen Z, the generation pouring into corporate America at the fastest rate, has often been the loudest about desiring employers who value their well-being at work.  

In fact, 70% of executives feel confident in the ROI from employee well-being strategies, up from 23% in 2018, according to a survey this year from Virgin Pulse looking at well-being trends. 

The pandemic underscored the harmful effects of pervasive burnout for individuals, like increased mental health strain, and for companies, like lower retention. When employees feel supported and safe—belonging—they burn out less and perform better. “When there’s safety, we respect an employee’s time, energy, and emotions,” Rachel Montañez, a career and burnout advisor for Fortune 500 companies, tells Fortune in an email interview. “In turn, people feel they can suggest and see improvements in things like reducing meeting inefficiencies, visibility and recognition, or even approaching an internal stakeholder to set better boundaries.” 

In a survey conducted by Ipsos last year, the vast majority of American workers—88%—say feeling like they belong boosts their productivity. Belonging, defined as being treated fairly and respectfully and having contributions valued by a team, is a major pillar of psychologically safe workplaces. It can have a payoff for the employer. 

“People who are feeling healthy mentally, physically, emotionally, are going to do their best work,” Buford says.  

However, only about a third of workers feel belonging at work, and nearly half don’t feel safe sharing their perspectives. Moreover, women of color face further barriers to feeling safe in the office as those “who have to navigate preconceived stereotypes while calculating the interpersonal risks when they speak up,” Ruchika Tulshyan, an award-winning inclusion strategist, CEO of Candour and author of Inclusion on Purpose: An Intersectional Approach to Creating a Culture of Belonging at Work previously told Fortune.

Hello, ‘human-centered leader’ 

Beyond combating the trope that hustle culture is the sole way to advance, leaders can model taking risks, speaking openly about challenges, and encouraging a growth mindset—where challenges serve as learning experiences versus failures. 

“All we’re doing is we’re inviting people in, which builds that trust factor,” Brad Deutser, author of Belonging Rules: Five Crucial Actions that Build Unity and Foster Performance, tells Fortune. “Leaders have to recondition and get back to this human-centered leadership, to understand that leaders don’t have to be the smartest people in the room. But, they can be the most thoughtful, the most inviting. That’s a big shift.” 

Deutser, who coaches corporations and teams on how to foster belonging and improve employees’ sense of safety, says leaders can start by asking open-ended and engaging questions of their employees. Instead of beginning questions using “why,” consider saying “can you tell me about,” “let’s go a little deeper,” or “help me understand.” 

“The human-centered leader is a person who is vulnerable and who is willing to over-communicate,” says Deutser, who encourages leaders to extend conversations with their employees by 15 seconds. “We have lost the art of asking questions—of inviting people in.”

For Tracy Layney, the chief human resources officer at Levi Strauss & Co., establishing psychological safety takes time and intention. “Of course, we can never know all the personal challenges an employee is facing. And not everyone is comfortable sharing,” she says in an email. “But leaders should aim to open the door to allow for honest discussions, something that helps us create and maintain a culture where employees feel respected by their leaders and confident enough to take risks.” 

ERGs, employee resource groups, help connect workers through a shared identity or experience and can bolster people’s sense of belonging at work, Layney says. But their success is dependent on a workplace’s level of psychological safety already, she says. 

“Feelings of inclusion are more likely to be experienced when a workplace is higher in psychological safety because diverse perspectives are more likely to be heard,” Layney says.  

Beyond fostering a daily culture where speaking up and advocating is celebrated not critiqued, safety also comes from feeling seen in the benefits and accommodations offered that prioritize an employee’s whole health. And more, it’s not enough to say, “go use this benefit” if senior leaders don’t do so first, Buford says. 

“It starts with the C-Suite,” Buford says about employees engaging in benefits like paid leave and mental health resources. “It’s actually the C-suite being vulnerable and talking about their own mental health challenges and their own vulnerabilities.”

Often, the inter-relational dynamics in an office get sidelined by conversations on revenue and output. However, when leaders see these as inextricably linked, workplace safety can lead to retention and improve a company’s bottom line. “When you create thriving teams and thriving environments, you get the most out of people,” Buford says. “We’re continuing to walk the talk on how we’re as senior leaders showing up and giving people permission to be their whole selves and their real selves.”