The young and the penniless: a view into the economic mindset of GenZs

Concerns around the cost of living could well be a symptom of the times, but for millennials and GenZs, who still have a credit portfolio to build in the face of relentless inflation, it has become a concern of great magnitude.

There are two sides to the coin of the seemingly penniless generation – one where both GenZs make up the bulk of the participants of The Great Resignation (where the working class is opting for more flexible working conditions such a remote and hybrid options), and that of those who are taking on what they term ‘side hustles’ to increase their credit ratings and supplement their lifestyles.

Ipsos recently released its Pinching Pockets: The South African Consumer Price War study which looks at understanding the shifts in Gen X, Millennials and Gen Z market behaviour in these turbulent economic times.

One thing remains for sure: there is a greater expectation around their willingness to take risks, rather than succumb to the vulnerabilities impacting their spending patterns.

Deloitte’s Gen Z concerns report connected with 14 808 Gen Zs and 8 412 millennials across 46 countries.

Their responses presented a picture of vivid contrasts, as these generations strive to balance their desire to drive change with the challenges of their everyday lives.

In a survey gauging their greatest concerns in life, Gen Zs (29%) and millennials (36%) selected cost of living (e.g. housing, transport, bills, etc.) as their greatest concern.

This speaks to issues that these generations have been expressing for years: they don’t feel financially secure personally, and at a broader societal level, they are deeply concerned about wealth inequality.

Globally, almost half of Gen Zs (46%) and millennials (47%) live paycheck to paycheck and worry they won’t be able to cover their expenses, and more than a quarter of Gen Zs (26%) and millennials (31%) are not confident they will be able to retire comfortably.

The study also found that around three-quarters of Gen Zs (72%) and millennials (77%) agree that the gap between the richest and poorest people in their country is widening.

But, these robust generations are remaining optimistic and trying to make things work. Amid this financial unease, many Gen Zs and millennials are redefining their working patterns.

As many as 43% of Gen Zs and 33% of millennials have a second part- or full-time paying job in addition to their primary job. Side jobs may also be about more than money.

For example, they can enable Gen Zs and millennials to hone new skills and tap into their entrepreneurial spirits.

The top side jobs held by respondents include selling products or services through online platforms, consulting, running their own business, and social media influencing.

On the other hand, a small, but growing, percentage are also moving to less expensive cities with remote jobs.

Remote working has allowed many of them to reduce living costs, by being able to continue living at their parents’ home (outside metropolises and main cities) and reduce their transport costs, also lessening their carbon footprint.

One way or another, whether the property market in on their side or not, they are making it work, even though only 28% of Gen Zs and millennials expect the economic situation in their country to improve over the next 12 months.

*Statistics derived from The Deloitte Global 2022 GenZ and Millennial survey