Millennials are born into the generation of people between the ages of 22 and 39. They’re regularly mentioned in the media – and for good reason… They represent over 14 of the 58 million people in South Africa, or 27% of the population. But their real stronghold is their economic power…
Millennials hold the lion’s share, with 55%, or over R100 billion per annum, in spending power, according to a stat from Ask Afrika, Youth Brands Research, 2017.
Taking a reading on the Millennials’ financial outlook in the midst of Covid-19…
Like everyone else, they’re pretty shaken up by the waning economy. In fact, even before the lockdown, research by Youth Dynamix (YDx) showed that 81% of respondents were worried about unemployment and their prospects of a financially secure future…
And, 80% say that they have delayed big purchases, including appliances, cars, homes and holidays, with this trend peaking with Centennials, according to globalwebindex, Coronavirus Research, May 2020.
But Covid-19 is just the latest financial threat to their livelihoods – millennials grew up experiencing tidal waves of economic turbulence…
Their first significant memory being the global depression of 2008-2009 which impacted their families by derailing their parents’ business or employment prospects.
Unemployment, particularly among the youth of South Africa, reached levels as high as 25% over the past decade – the period in which this generation was entering the job market.
And then there’s been the ripple effects on the economy – and their lives – from load shedding, drowning parastatals, crime and corruption.
But far from being victimised by these catastrophes, millennials are outdoing previous generations in terms of spending power!
In fact, being a product of turbulent economic conditions could explain a lot about our prized millennials…
New expectations from life – from a wisened generation…
In general, they’re taking a different path to their parents’ “work hard, get married, buy a house, have a family and save for retirement” recipe to life.
For starters, while pay and compensation are still important to them, it’s not always the overriding factor when it comes to choosing the best place to work. Millennials tend to weigh in on other values, like autonomy, respect and doing something meaningful with their lives – like making a positive contribution to the environment.
It’s unthinkable for millennials to consider staying in one job forever like their parents so desperately endeavoured…
Perhaps, they’re more confident in their entrepreneurial abilities than past generations… YDx research shows that one in five millennials had a side hustle to supplement their income, even before the lockdown… And 70% wanted to own their own business in the future.
Time to question our perspectives of a ‘spoiled and materialistic’ generation?
If nothing else, Covid-19 has made us all question our sense of normality… And, perhaps we’ve been too quick to saddle this generation with the ‘entitlement’ label…
Contrary to the general portrayal in the media, YDx research shows that millennials are actually reasonably responsible, independent and savvy when it comes to making financial decisions.
…Before the Covid-19 breakout, 51% of the respondents’ income went towards funding their own essential expenses, like rent, groceries, clothes, transport and cellphone, so they wouldn’t have to rely on their families. This figure is undoubtedly higher now, with Globalwebindex, Coronavirus Research, May 2020, showing that 67% of consumers have been dramatically impacted by the pandemic.
Millennials often delay buying their first property, with many preferring to spend their money on experiences, like travel, while an impressive 92% have some sort of investment product, according to YDx research.
Other research shows they’re leading the way in ethical investing by leaning towards financial products aligned with their progressive views on diversity and environmental values.
And, saving is important too to this generation: in YDx research, 57% said they want to be more careful with their spending the next year.
Drastic times call for a new shift on our outlook on millennials…
Letting go of the preconceived notion that older generations and established businesses have the formula to success, and life in general, all figured out, is possibly one of the toughest but essential pre-requisites to staying afloat in a post-Covid-19 millennial-led economy…
This generation has the biggest stronghold on the economy in an era in which the landscape is without a shadow of a doubt reshaping itself.
Find out how your business should be realigning its offerings to thrive beyond 2020 with the eye-opening insights contained in the Money Habits of Millennials Report, by YDx and InfoQuest. Contact Andrea Kraushaar on 082 330 0290 or andrea.kraushaar@ydx.co.za to enquire.
