Baby Boomers versus Millennials. This has been a trending topic lately from print to internet to social media. Ironically speaking, while there’s a miscommunication between these two generations, majority of the millennials are children born and raised by my fellow boomers.
BABY BOOMERS DEFINED
My generation was tagged as such due to the increase of birth rates between 1946 to 1964 right after World War II. It was brought about by hopeful perspective that the world condition will be better and was proven by the improvement of economies, businesses and jobs. This generation also brought relative prosperity to the economy, the reason why it was considered as an economically influential generation. Some even claimed it to be the greatest generation, to which of course other generations might protest. Boomers love to invest — properties, cars, appliances, gadgets and other items due to their high spending power.
The magazine The Economist even coined that the decade of the “young old” begins with 2020 as predicted by John Parker. The young old or “yold” term originally came from Japan, pertaining to people with ages between 65 to 75. At this point in time, many are retiring but life expectancy for this batch is longer. With more energy and funds for the boomers, it is the time to travel, start a business or move to the suburbs and enjoy the scenery. Yold or boomers per se are retiring but not really retiring. A lot will continue to work, stay socially engaged and will still change the world. Although health will at this stage for some deteriorate, many yold have 3.7 years of increased life expectancy especially those who stay busy working. A German study found that people who remain at work after the normal retirement age manage to slow the cognitive decline associated with old age.
The yold are challenging the traditional expectations of the retired people who simply wear slippers and look after grandchildren. Some have even gone back to continuing education with an increase of enrollees compared to university enrollees, the present reality of Harvard. They also change the perspective in pension as the yold aims to manage their pension receipts more actively. In time, yold will be back in the industries but only if people’s attitudes towards old people change and appropriate government policies are enacted. High numbers of healthy yold will change drastically their health spending.
This is the so-called “criticized and entitled generation,” “me generation,” born in between 1981 to 1996, known to be the batch who prefers work and life balance. My staff belong to this generation and they say that most of their peers, themselves included, prefer spending their hard-earned money in travels, expensive restaurant and convenience (e.g. grab for transportation, coin laundry instead of doing it themselves to name a few). This generation was also perceived to possess a high tendency of delaying their adulthood because most of them are living with their parents for longer period as compared to previous generation. At this point though, a great minority of millennials, just like here in my workplace are taking over.
In the next 10 years, the millennials will be dominating the work force globally at around 40% of the population, Gen X (sandwiched between boomers and millennials) will be at around 26% and most of the baby boomer’s will be facing retirement. Gen Z (1997 to 2012) or digital natives will also start joining the work force by then.
This phenomenon is defined as a demographic shift expected to bring changes across the globe in the next decade. Despite delays in their “adulting,” millennials are expected to have the fastest growth in net wealth in the next decade. Most of them will also enter family formation age and will be looking to purchase their own homes. They could be a catalyst for change, as reported by Cushman and Wakefield’s “Demographic Shifts: The World in 2030.”
On the other hand, the boomers’ retirement is also expected to bring shift in certain industries probably in leisure travel, traditional retail and health care. For Generation Z, they will expect technology to be seamless. Experiential retail and e-commerce are two industries that are seen to benefit from Gen Z’s.
The risks? Boomers are taking the back seat as people claim but not really. Gen X which is also the MTV generation has gained a reputation for entrepreneurship. Millennials have to man-up so to speak and Gen Z should be trained to develop their emotional and social skills.
For a more sustained future, these generational players should be conscious of the brewing gaps because of the difference in outlook, opinions, beliefs, skills, attitudes and behavior each age group brings, especially in the workplace. The challenge is to build solid bridges and strike a balance that will allow each generation to build on their strengths and deemphasize their weakness. It all starts with understanding each other and a willingness to meet somewhere in between.
As the old adage says, “there’s nothing permanent in the world but change.” With ample time to prepare and faced with the reality that society will remain to be a mix of different age groups and expectations, the world must be ready for what lies ahead. And it all starts with the age groups making a conscious efforts to first accept the differences, and to move beyond limited expectations. The key here is conscientious communication as in the end, we are not competitors but collaborators for a better world.
The views expressed herein are his own and does not necessarily reflect the opinion of his office as well as FINEX.
Benel D. Lagua is Executive Vice-President at the Development Bank of the Philippines. He is an active FINEX member and a longtime advocate of risk-based lending for SMEs.