Gen Z Insights: How the Cost of Living Crisis Affects Gen Z Spending

The steep rise in inflation is felt all over the country. In April 2022, the Consumer Price index increased by 9% in one year and 2% since March. At the same time, rising gas and energy prices are raising concerns about how many families in the UK will pay their bills when winter comes.

Almost all types of goods have experienced a price hike in recent years. As a Gen Z insight platform, we pay close attention to how these daunting changes affect the youngest spending generation today. In this article, we’ll share some Gen Z research on how the cost of living crisis will likely impact Gen Z’s consumer habits and mindset.




A Generation Precariat 

The Royal Society of Arts, manufacturers and Commerce (RSA) has recently researched the financial situation of Gen Z and how it affects their health and view of the future. The study found that 47% of young people are only just about managing to make ends meet each month. Others have income that varies from paycheck to paycheck.

Young people are likely to take hits to their savings and are more likely to take on debts. Only 25% of those aged 22 to 24 right now have access to savings. 75% of young people will have some sort of debt by the time they turn 22.

Gen Z’s Changing Mindset

With the stats above in mind, it is no surprise that most young people in this precarious situation have significant concerns regarding their financial futures. For example, 41% believe they will never buy their own home, and 51% think they will never be able to support a family.

According to Deloitte, 31% of Gen Z now cites the cost of living crisis as their most significant concern. In the year before, it was climate change. This shift in thinking promises a more practical outlook in the future. Gen Z, though a conscientious and socially active generation, will be forced to consider product prices as a deciding factor in their purchases more than before. With paychecks going primarily towards food and bills, less money remains for luxury spending. 

Gen Z will likely seek practical advice to prepare themselves for a tighter financial future. 

Gen Z Research Will be Vital in Months to Come

If your business primarily markets to Gen Z and Millenials, the overwhelming anxiety surrounding the cost of living crisis will likely affect your revenue. In the coming months, Gen Z insights will reveal how young generations are changing their consumer behaviours to match a more daunting financial reality. One way to assure you’ll be able to adjust alongside your audience is by engaging with an Insights platform. ThisIsSelfhood is a Gen Z research company focused on understanding the evolving mindset of young consumers. Visit our website to learn more.

 

Location: London, UK

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