Inflation and the highest interest rates we’ve seen in years are leading to a fundamental shift, especially among younger generations, many of whom still live with their parents.
Some among the younger generations – burdened by the high cost of living, especially housing expenses and high grocery prices – believe it’s time to reassess the idealization of homeownership and consider multigenerational living. While there’s nothing fundamentally wrong with this trend, the rapid decline in our standard of living undeniably affects our younger generations.
A CNBC and Generation Lab Youth & Money survey recently revealed the dire statistics. In a nutshell, 55 percent of young adults in the United States find buying a home significantly more challenging, 44 percent struggle with job hunting, and 55 percent have difficulty getting promotions.
In Canada, according to RBC’s financial well-being survey, millennials are most likely to suffer from sleep disturbances due to financial worries, with 53 percent expressing such concerns. Generation Z closely follows, with 48 percent also experiencing sleep disruptions related to finances. In other words, Generation Z and Millennials find it much more challenging to navigate the challenges of adult life.
Indeed, young people are finding saving or envisioning a better future increasingly challenging. Rather than saving for a home that seems financially out of reach, some may wonder why not go out and have fun. This shift in perspective is already taking place. Achieving professional goals and amassing wealth for oneself and future generations appears less attainable for many young people. Moreover, despite a low unemployment rate, securing suitable employment remains notably difficult. This poses a cruel paradox for those who believed the job market was supposed to offer them what they wanted or close to it.
When this shift occurs, of course, eating habits change.
Baby boomers and Generation X will overcome these challenges more easily. Young people, on the other hand, once perceived as spoiled and overly idealistic, are now facing a different reality.
But history has taught us that fundamental economic changes often lead to innovation and resilience. After the Second World War, we witnessed the emergence of new restaurant models, such as fast food and efficient large-scale food production. A few years ago, food halls offered a new experience to consumers. Today, we may witness the rise of a new style of restaurant where food quality meets affordability, bridging the gap between existing options. The same goes for groceries. You never know.
A recent report on the food retail industry suggests that consumers, especially younger ones, are turning to discount banners, which have seen a more than 10 percent increase in sales and an increase in market share of nearly two percent compared to conventional grocers. Sales of private label products have also increased by more than 10 percent in the past year, surpassing national brands in all departments.
The stigma associated with shopping at Walmart, Giant Tiger, or even Dollarama is fading for young people. Food elitism is giving way to financial prudence. Generation X also had their share of misery in the early 80s when inflation and unemployment rates were very high. They survived. Young people’s hardship leads to changes in attitudes and behaviour. Predictable and necessary.
For all of us, however, we have a nation filled with heavily indebted consumers, a stagnating economy, and productivity that has been stagnant for some time. If saving becomes less of a priority for those who no longer believe that owning a home or having children is attainable, it could eventually catch up with all of us.
Ambition and enhancing opportunities remain the most crucial avenues for our economy to chart a course toward growth. It is essential, however, to provide support to our youth, but above all, young individuals must maintain a sense of realism while holding on to the belief that brighter days lie ahead.
Dr. Sylvain Charlebois is senior director of the agri-food analytics lab and a professor in food distribution and policy at Dalhousie University.
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