China's Generation Z, or those born after 1998, appear to be less worried about saving money compared to kids their age in other countries, with many preferring to spend on luxury items and experiences. According to a study by OC&C Strategy Consultants, which looked into the lifestyle attitudes of some 15,500 youth respondents in nine countries, Chinese teens are one of the major reasons why international brands are scrambling to enter the local market.
Generation Z'ers account for 15 percent of average household income in China, compared to just 4 percent in the UK and the US, notes the Straits Times. It is notable that the majority of these individuals are still not part of the workforce, but have their parents' and families' money to spend on big-ticket items.
The strong spending power of China's youth can be attributed to the country's one-child policy, which enabled households to set aside more money for leisure and entertainment purposes. Other countries do not have this limitation. In the US, for instance, most families have two or three children who each face expensive school fees, in addition to their basic needs. Because Chinese families have only one child to support, they tend to be more generous with cash and gifts, and also place less pressure on the young ones to save or even work harder.
The study points out that while the rich Chinese Gen-Z youth have lots of money to splurge, it appears they also do not have the propensity to save. It also seems that because of the lack of pressure to perform, China's youngsters do not see the value of hard work to earn money and are even willing to take on debt to finance their whims. This is a worrying prospect for when times get tough, especially if the China-US trade war continues.
The research, titled "A Generation Without Borders," was based on results of a quantitative survey conducted in Brazil, China, France, Italy, Poland, Germany, Turkey, the US, and the UK. It polled responses from kids aged 16 to 21 years old. Customized discussion panels to further explore the rationale behind specific answers were also conducted in China, the US, and the UK.
