Does Generation Y have it easier than the Baby Boomers?

Thursday, April 14, 2016

Generation Y are today’s 22 – 36 year olds, and make up 22% of the Australian population (5.22 million). They also make up the largest cohort in the workforce (34%). Gen Y’s are comprised of today’s parents, senior leaders, influencers, and increasingly wealth accumulators. With 1 in 3 being university educated (compared to 1 in 5 Baby Boomers), they have grown up in shifting times and are digital in nature, global in outlook and are living in accelerated demographic times.

Our Research Director, Eliane Miles, chats to Tony Delroy from ABC Nightlife about the future of Generation Y and whether we need to stop giving Gen Y a hard time.

Eliane, can you compare the wealth of the baby boomers at 25, to Gen Y at the same age – what story do the figures tell?

Well earnings have certainly increased, with average annual full-time salary in 1984 at $19,000 compared to $80,000 today. However houses were also cheaper, with the average price of a residential property costing just $64,000 compared to more than 10 times that across the nation today. In 1975, the median house price was just 5 times the average full-time earnings, but in 1996 this increased to 6 times and today it currently sits at 13 times! Property was cheap, and while it was more difficult to borrow, Baby Boomers were raised with a saving mindset so made the most of their hard work.

There has been a stereotype of Generation Y being demanding in the workplace, not being prepared to put in the hard yards at the bottom of the rung, of not holding loyalty towards employers – to what extent do you think any of those stereotypes ring true?

These stereotypes are the same stereotypes that were made 15 years ago towards Gen X. That somehow the economic mishaps of Gen Y are their own moral failure (lazy, expect too much, spend too much time on social endeavours). Yet there’s a lot of other factors at play and it’s not entirely bad. They’re not locking into a job the same way as their parents (average tenure is 2 years and 8 months for Gen Y compared to 6 years and 8 months for Baby Boomers) but it’s not all bad. Enduring education longer, staying at home longer, the reality of formal education and global connectedness means they’re more equipped and resourced to collaborate in the 21st century, more able to engage in a diverse workforce and lead in collaborative ways.

The fact that Gen Y’s value work-life balance is a good thing, they are less likely to get burned out, more relatable to life, not just saving their leave for one day in retirement but bringing life. Older generations bring experience and structured thinking, younger generations bring innovation, 21st century education, and greater cultural diversity to the working world.

Eliane, do you think there are certain expectations that Gen Y grew up with that they’re suddenly wondering if they’re actually going to happen?

Yes certainly. Gen Y’s saw the miracle wealth accumulation that their Baby Boomer parents had, and expect to start their economic lives in the same way their parents are ending theirs. Now, there’s a realisation that all of the factors that set up the Baby Boomer generation probably won’t be on-side for Gen Y. They’ve dreamt of having it all – the house, the car, the annual overseas trips, the dining out … but the reality of what they’ve been handed is that one or perhaps more of those things need to go.

How was the economic environment different for young baby boomers compared to young Generation Y’s?

Baby Boomers were handed a series of fortunate events. Rather than looking at income in the mid-20s let’s compare the two environments in which they became wealth accumulators.

Firstly, the path begins with their birth (1946-1964), a period of time or remarkable economic development after WW2 (post-war rations, high rate of savings). Beliefs about what the government should provide (health care, education, unemployment, and tax benefits) have reflected the priorities of this generation and the environment that they were raised in.

Then they benefited from the good economic times in the late 1990s and early 2000s, as they were already in the property market. Baby Boomers had a 27 year period of uninterrupted economic boom (from the recession in the early 1990s to 2008) which is likely to be unprecedented and never again seen among Australians of any generation.

Now the tables have turned.

Gen Y didn’t get access to free education, cheap rent while saving or union-protected and secure jobs. Young people today have little prospect of owning a home, so consumer spending improves their quality of life. Baby Boomers have a larger share of the pie while Gen Y, nor any other generation following the Baby Boomers for that matter, will reach a similar landmark. They benefited from advantageous tax systems and modest taxes. Their generation thrived in a unique, economic miracle.

But it’s not all bad news for Gen Y.

Australia is one of the few wealthy countries which has seen disposable income growth be higher for those aged 25-29 than those aged 65-69, with 27% growth compared with 14% growth between 1985 and 2010.

When it comes to homeownership amongst Gen Y members, how do they compare to the generations before them at a similar age?

In 1981, 61% of those aged 25-34 owned their own home and in 2011, this figure had dropped to 47% of those in the same age bracket. Across the board (not just in the younger years) we’ve seen a decline in home ownership. 20 years ago, 42% of Australians owned their home outright, which has decreased to less than 30% today. Furthermore, just 26% were renting, which has grown to almost a third today (31%).

So why this decline? This can be attributed to the emergence of single-person and single-parent households, the growing gap between house prices and average weekly earnings and tax concessions to owner occupiers. With government policies being geared towards home ownership, this means that Gen Y’s who start their earning lives later risk spending more of their income on housing costs when they retire.

Let’s set the crystal ball 50 years into the future – Eliane what do you see for Gen Y in 2066?

Demographically, Australia’s population will certainly have grown – Australia will have over 40 million people, Sydney over 8.4 million and Melbourne 8.5 million, having overtaken Sydney as Australia’s largest city by 2056. Migration will continue to drive growth, and with increasing cultural diversity and greater influence from Asia, the population growth will continue to drive house prices upwards.

Australia’s population will also be ageing. 58% of the population will be in their 50s or older in 2066, one quarter will be over 65 and 1 in 6 will be over 75. In a nutshell, there will be more people aged over 60 than under 20.

And lastly, we will have changed a lot in that time as well. In 2066 Gen Y’s will be aged 72 to 86, and Gen Z’s (those now aged 7-21), of whom there are already 4.43 million in Australia (comprising 18% of the population), will be nearing their retirement years (57 to 71). So by 2066 we’ll have seen 3 more generations emerge after Gen Alpha and we can be sure that these individuals will be shaped in completely different times.

ABOUT ELIANE MILES

Eliane Miles is a social researcher, trends analyst and Director of Research at the internationally recognised McCrindle. As a data analyst she understands the power of big data to inform strategic direction. Managing research across multiple sectors and locations, she is well positioned to understand the mega trends transforming the workplace, household and consumer landscapes. Her expertise is in telling the story embedded in the data and communicating the insights in visual and practical ways.

From the key demographic transformations such as population growth and the ageing workforce to social trends such as changing household structures and emerging lifestyle expectations, from generational change to the impact of technology, Eliane delivers research based presentations dealing with the big global and national trends.

With academic qualifications in community engagement and postgraduate studies in international development and global health, Eliane brings robust, research-based content to her engaging presentations and consulting. As a social researcher, she has been interviewed on these topics on prominent television programs such as National Nine News and Today, as well as on radio and in online media.

DOWNLOAD ELIANE'S SPEAKERS PACK HERE

To have Eliane present at your next event, please feel free to get in touch via email to ashley@mccrindle.com.au or call through to 02 8824 3422

Welcome to our blog...

We have a passion for research that tells a story, that can be presented visually, that brings about change and improves organisations. And we hope these resources help you know the times.

Our Social Media Sites

Facebook | McCrindle Research Social Media YouTube | McCrindle Research Social Media Twitter | McCrindle Research Social Media Flickr | McCrindle Research Social Media Pinterest | McCrindle Research Social Media Google Plus | McCrindle Research Social Media LinkedIn | McCrindle Research Social Media Mark McCrindle Slideshare


Last 150 Articles


Tags

results Andrew Duffin facts rising house prices greatness social issues financial future goal Research Executive debt world celebration study NEETs Netflix high school stay home states moreton bay weekly earnings slideshare Queensland new york times schools buildings census 2016 report presentation brands Aussie Merry Christmas mccrindle dreaming World Water Day 2016 JOMO financial dreams video friendship hobart selfie social research mccrindle in the media award winner conferences 23 million non profit charity social national wealth area not-for-profit winter blues sydney hills education professional services aged care puzzle media release social media economic environment victoria university the average aussie teacher seasons intern leadership online shopping DIY wage perth wealth capital city James Ward Real Estate students dessert social commentator Engineering Manager supply and demand Gen X gen alpha social shifts 10 years narcissism 2017 The ABC of XYZ ultimo list newspaper shopping leader future proofing social enquiry shopper's pick earning education future report cancelling plans survey forecast property market visual year 12 conference presentation state grave decision mining boom generational trends research pack poor NBRS quote renting rich Australian Census sports fresh 2016 census results mentor cancelling event crows nest Sydney budget socialites teachers teach christian local communities demographic ipswich teleworking ideas Gen Y clothing environmental scanning VET McCrindle Speakers visualisation crime research services small business dream staff analysis marrickville growth socialising housing balance divorce rain events future alpha life trend tertiary education repayments sustainable wedding SMART affordability Australian schools TAS young people housing market business index wealth and income distribution Australians 2014 vegemite the hills internship January 26th cancel plans insights Real Estate Institute of Victoria Australian Population Valentine’s Day Canberra SA school satisfaction darwin society REIV Conference data visualisation Macquarie University entertainment unemployment engage affordable social commentary research data huffington post meetings FOMO sector australia event belief women generation cooking outsourcing woolworths community global neutral bay gen z census fail mccrindle research marketing VIC educated housing affordability dare to dream offenders mateship society trends market research Financial Planning Association of Australia forum rental stress ferry house price qualitative research going out house product investment thrive safe cold christianity jobs of the future baby parenting Hornsby Shire Council baby names report sun financial children rise of local storytelling ACF Duchess of Cambridge snapshot finance princess charlotte commuters keynote speaker house price rise motivate tips bureau wealth distribution mortgage mobile Christmas lunch Tuesday Trend social change divorce rate Education Future Forum year 7 2015 logan 1975 jobs suburban living the australian dream DESTEL names entrepreneurs of today aged care faux-cilising breakfast award social researcher 1994 couple work Australian communities media annual income australian communities forum Caregiver bus Adelaide not for profit workplace culture holidays census resource Generation Y eliane miles easy rider language home owner financial fears office futurist English renter of the future changing face of sydney easter wellbeing retirement REIV National Conference education sector criminal know the times FPA economy news brand experience train monarchy culture collaboration geomapping capital cities global generations Christchurch trends of 2017 brand GPO income Financial Planning Week Res Vis Australian Home religion vegetarian volunteers program population milestone participants publication census results Northern Territory entrepreneurial winter Wodonga Geoff Brailey travelling father's day Hills Shire Council skills royal family eliane overcast school students contiki pharmacy energy Vocational education future of work low density mccrindle tea experience Christmas presents average aussie financial independence New South Wales future of education IT Specialists men sentiments christmas Australian Trends NBRS Architecture brisbane infographic wall medicine conference australians staying home more statistics Aussies February 16 baby names australia report millennials define rent responsive research report real consumer CBD earnings HSC data analyst owning a home group social impact optimistic Myth world youth day population growth Word Up Queensland: QLD australian communities trends report communications interactive trades pyrmont cash kate middleton Australian demographics shifts megatrends demographics ashley fell household optus future proof Kirsten Brewer summer keynote Scouts optus my business awards university degree the changing face of identity Royals internet bondi Territory communicate trends middle class city click collaborative #censusfail long weekend 24,000,000 housing growth paying to work home ownership residents child care SMSF innovative gender graphs "know the times" emerging trends increasing densification Australian Families 2020 trend tuesday Wagga Wagga culturally diverse generation alpha Generation X home organisations personalities professional 40 million online weather baby boomers demographic transformations organisational culture land of the middle class 1968 cost royal fears NSW wolloomooloo urban taskforce Do It Yourself omnibus sydney event digital 2013 baby name trends emerging generations aussie culture office space new office local generations demographic trends the hills shire property Western Australia professional development communication insight mythbusters career travel sunny days national crime rates priorities Charlotte trends analyst group session engagement shbc relevant social lives Australian Dream leadership workshop social trends Australia Day 2017 trends of 2016 google for education ACF 2016 education research in the media lalor park debate faux-ciliser population map survey design educhat hills shire future-proof Kiwi careers EFF tattoos households TDE sunburnt country relational business Bathburst generation Z Australian Bureau of Statistics global financial crisis resilience baby name consumerism investor Crime Rates mythbusting poker master proactive Love staying in learner potts point Channel 7 urban living school Northern Beaches Christian School research visualisation workshop anzac schools students deloitte property price South Australia living national private wealth sydney speaker royal influence litter panel salary suburbs work mates Sydney Hills Business Chamber media commentary innovation suburb ageing population Population Clock public holiday Mark McCrindle Deaths coffee hornsby baby name predictions ageing urban technology training cultural diversity ACT case study presentations food Assistant Store Manager office opening acf15 toys holiday daily telegraph Melbourne data investing focus groups System's Architect community engagement typical australian twentyseventeen urban living index goals PSI marriage internships sydney metro Australian Communities Trends faux-cilise 2016 census housing trends VET sector equip Tuesday Trends builders ease of travel research Tasmania change nfp Northern Beaches baby names marriages family faith infographic forecasting mother's day hopes waverton public speaking cartodb workforce sydneycity post rationalism The Daily Edition New Zealand Financial Planning Association Australia Day Work place pharmacies NT healthy future high density 24 million tuesday plans learning customer conference speaker learn recap workplace in depth interviews professional speaker ashley mckenzie networking church social researchers growing population 2012 politics ABS population media activity emerging technologies apartment WA Skilling prince george business performance researcher New Zeland blaxland tv teaching etiquette stats mover and shaker focus group house prices daily commute sydneysiders hello fresh cloudy days australian social research gold coast unaffordable communities manly earn commute community event education future high density apartments water entrepreneur challenge millenials authenticity personal growth village moderators guide Sydney keynote speaker meals Channel Seven menai cost of living Christmas season families norwest Social Trend domestic wealth and income speakers car tableau cars thought leadership employers curiosity story student millionth Northern beaches Event spirituality Wellington employment rule keeper spend public speaker sector wide youth townhouses royal baby sector wide study young australians happiness transport wages social analysis social life Births follow baby boom 1980 lifestyle youth unemployment ethnography parents demographer google learning styles friends work-life government grandparents tea high density living

Archive