Economic Progress

Generation Z will outnumber Millennials this year

School boys get drenched in a large wave during high tide at a sea front in Mumbai July 14, 2014. Weak rainfall in India since the start June, when the monsoon season began, has raised concerns of a first drought in five years, although weather experts are hopeful rains will revive in the next week. REUTERS/Danish Siddiqui (INDIA - Tags: SOCIETY ENVIRONMENT TPX IMAGES OF THE DAY)

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Johnny Wood
Writer, Forum Agenda
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Economic Progress

The turn of the century marks the approximate point where Millennials stop and Gen Z begins. Opinions differ on the exact crossover date, but jumping the generational divide brings fresh challenges for companies trying to engage with the new demographic.

Recent research from Bloomberg predicts that Gen Z-ers will account for 2.47 billion people of the 7.7 billion inhabitants of planet Earth by 2019 - that is 32%, and surpasses the 2.43 billion figure for Millennials for the first time.

The study is an analysis of the United Nations population data and marks 2000-2001 as the intergenerational cut-off point.

Image: Bloomberg

Crossing the threshold

In North America, Gen Z or iGen as it is sometimes known, currently makes up one-fifth of the nation’s population and forms the most racially and ethnically diverse generation in the country’s history.

The research shows Millennials will remain the dominant group in the world’s four largest economies of China, US, Japan and Germany, with a ratio of 100 millennials to 73 Gen Z-ers. These four powerhouses have a combined population approaching 2 billion people.

In sub-saharan Africa, however, lower child mortality and higher birth rates have boosted Gen Z numbers, which already surpass Millennials in 48 out of 50 nations. In west Africa the emerging generation dominates by a ratio of 2 Gen Z-ers to 0.2 millennials.

How today’s teens and tweens see things

A dominant Gen Z demonstrates a very different world view to its predecessors.

Each generation has its own characteristics that differentiate it from the one that went before. According to Marcie Merriman, an executive director at Ernst & Young, the world is changing at speed and attitudes have moved on from the self-centered what’s-in-it-for-me entitlement of Millennials.

Image: Rise of Gen Z - New challenges for retailers

In her report, Rise of Gen Z: new challenges for retailers, Merriman points to the Gen Z characteristics of self-awareness, self-reliance and innovation.

Like Millennials, the latest generation spend time on social media sites like Instagram, Snapchat and YouTube, looking for entertaining content to share with their peers. But Gen Z-ers have no experience of pre-digital life.

They were born into a social world of likes and shares, constantly connected by smartphone, tablet or computer to online shops, payment and banking services. They have grown up with instant information and interaction with friends, relatives and peers.

Have you read?

The link to technology is inherent in the way Gen Z-ers think and act. Its members are well informed, innovative and ready to take responsibility for their own lives.

Merriman points to a generational pessimism about future economic opportunities, which is mixed with a positive desire to innovate and create opportunities.

She explains that the new generation occupies a world of constant change and disruption. Growing up in turbulent, often unpredictable times has reduced the likelihood that Gen Z-ers will take unnecessary risks and has increased awareness of how and where they spend money.

Today’s teenagers expect goods to be delivered to them and demonstrate low, or no, brand loyalty. To engage with Gen Z-ers businesses will have to innovate to get noticed.

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