Meet the typical Gen Zer, who is quitting their job, has over $17,000 in student debt, and is influencing nearly everything you buy
Hillary Hoffower
- Gen Z, the oldest of whom turn 24 this year, is the new "it" generation.
- They're setting trends in fashion and in the workplace, influencing consumer and worker behavior.
Gen Z has stolen the crown from millennials as the media darling of the moment.
The generation, the oldest of whom turn 24 this year, is in the spotlight as they begin to wield influence over lifestyle, work, and consumer trends. Look no further than various headlines promising how-to meet Gen Z demands in the workforce or market beauty brands to them.
It's a coming-of-age story, and Gen Z is shaking things up as they enter young adulthood. They're the first digitally native generation and they're best reached online, where they're often catapulting new trends. They're innovative, entrepreneurial social activists, ready to create and shape a better world.
They were hit by the pandemic during some of their most formative years, which could shape their futures over the long term. The oldest members of the "TikTok generation," who graduated into a recession, run the risk of repeating millennials' economic plight, but they're already showing signs of behaviors that could define them for years, trying to save and invest early and embrace a lifestyle based on thrift.
By size and spending power, they're set to take over the economy in a decade, but their spending restraint and skepticism about markets could make that economy very different.
While it's hard to capture an entire generation when some members are still teens and others are adults — demographic differences that produce data filled with caveats — here's what life looks like for the typical Gen Zer in 2021.
Gen Z emerged in the limelight during the pandemic, taking over as the latest "it" generation.
Gen Z is the most ethnically diverse generation in history and set to unseat millennials as the most educated generation, too. But Jason Dorsey, who runs the research firm Center for Generational Kinetics (CGK), says they're not millennials 2.0.
"They are really a distinctive generation with a different set of parents raised at a different time, that are coming into the world with some different views," he said, adding that the oldest members are entering the life stage in which they're exerting enough influence to take the mantle as the "it" generation.
Society feels like it finally understands millennials, he explained, and is switching focus to the next generation, which remains a mystery. That leaves Gen Z "shifting and driving much of the conversation," and he predicted they'll do so for the next 15 years.
They're the first generation to grow up in a wholly digital era, making them tech-savvy and mobile-first.
Gen Z was born into a world marked by technology, the internet, and social media. The average Gen Zer got their first smartphone just before their 12th birthday. They communicate primarily through social media and texts, and spend as much time on their phones as older generations do watching television.
The pandemic heightened their digital behaviors. With ample time to scroll on their phones, they digitally bonded with one another as many moved back home during the pandemic at a similar life stage, Dorsey said.
This helped TikTok, Gen Z's favored platform, blow up during the pandemic. By September 2020, the social media app had grown by 75%, and expanded into intergenerational use. It signals the growing influence of Gen Z in leading consumer behavior, much like millennials did with Instagram.
Like millennials before them, the typical Gen Zer has had — and will have — their share of economic troubles.
The pandemic put Gen Z on track to repeat millennials' money problems. As is typical with recessions, the youngest workers were hit hardest. Gen Z students could lose $10 trillion of life cycle earnings due to Covid lockdowns, the World Bank has estimated.
A Bank of America Research report called "OK Zoomer" found that the pandemic will impact Gen Z's financial and professional future in a similar way to how the Great Recession did for millennials.
"Like the financial crisis in 2008 to 2009 for millennials, Covid will challenge and impede Gen Z's career and earning potential," the report reads, adding that a significant portion of Gen Z entered adulthood in the midst of a recession, just as a cohort of millennials did.
"I'm a little worried about ending up like those who graduated around 2008," Maya Tribitt, a junior at the University of Southern California, previously told Insider. "A lot of the fear people my age have about getting jobs right out of college have come from the horror stories of people 10 years older than us. It's really scary to think that might be our new reality."
But the typical Gen Zer is already trying to build wealth, hoping to avoid millennials' record of falling behind.
As of 2017, 70% of Gen Zers were already earning their own spending money, per a CGK survey. That's the same amount as millennials, who are 10 years older on average.
A follow-up CGK survey in 2020 found that the pandemic has taught Gen Z how to be frugal. They've begun saving money and investing earlier than previous generations did, and they're seeking good job benefits, Dorsey said.
More than half (54%) of Gen Zers are saving more since the pandemic began than prior to it, according to the State of Gen Z report. Thirty-eight percent have opened an online investment account, while 39% have opened an online bank account.
Despite investing earlier, though, Gen Z is going to have to work harder to get a return. They're set to earn less than previous generations on stocks and bonds, as Credit Suisse's global investment returns yearbook found Gen Z can expect average annual real returns of just 2% on their investment portfolios — a third less than the 5%-plus real returns that millennials, Gen X, and baby boomers have seen.
Their average credit-card debt is $1,963, less than any other generation.
Gen X has the most debt because they're in their prime spending years, followed by boomers, according to an Experian Consumer Debt study.
It makes sense. With the oldest members of the generation in their early 20s, and the majority of the cohort still in its teen years, Gen Z has yet to enter their prime earning years or come into full spending power. The oldest are still getting their feet off the ground in the workplace, and most don't have assets like a house and a car as older generations do.
That's not to say Gen Z is debt-free. On average, they carry loan debt of $15,574.
They have less student-loan debt than other generations — an average of $17,338 — but that's likely to grow as the generation ages into college life.
So says the Experian study.
What was once largely viewed as a millennial problem is now becoming an issue for Gen Z. The generation holds 7.37% of the national $1.57 trillion student loan debt, but college is only getting more expensive. That share is expected to grow as more Gen Zers enroll in college.
The future of student debt is highly uncertain, as President Joe Biden campaigned on canceling thousands of debt for each student, but he's been reluctant to actually do it since his election. The Democratic Party is in something of a civil war over Biden's authority to cancel debt unilaterally, leaving borrowers at a standstill.
Despite their good money habits, the typical Gen Zer drove debt growth during the pandemic. They owe $16,043 on average.
Gen Z had the most debt growth of any generation between 2019 and 2020, with the average balance increasing by 67.2% from $9,593, per the Experian report. But that's still less debt than all other generations have, and Experian said the increase "seemed to track with age — the greatest growth occurred among the youngest consumer group."
That growth was mainly across mortgage and personal loan debt; Gen Z owe $169,470 and $6,004, respectively. It seems, then, that homebuying Gen Zers are leading the charge in their generation's debt upswing.
But the typical Gen Zer is still set to take over the economy in a decade.
Bank of America Research's "OK Zoomer" report found that Gen Z will fare well in the long run. The generation currently earns $7 trillion across its 2.5 billion-person cohort, it stated. By 2025, that income will grow to $17 trillion, and by 2030, it will reach $33 trillion, representing 27% of the world's income and surpassing that of millennials the following year.
Research and advisory firm Gen Z Planet recently found that the generation is saving and investing more than it's spending, and now holds $360 billion in disposable income.
They're already influencing consumer behavior. The typical Gen Zer is rebelling against all things 2010s, while reviving the trends of the early millennium.
Research has shown that, in moments of economic turmoil, humans are more likely to feel nostalgia. Gen Z's version of a nostalgic escape from the pandemic is reviving the fashions from the time before social media took over.
From wired headphones to claw clips and baggy jeans, they're reviving the Y2K trends of yore in what Sara Fischer of Axios has deemed a "throwback economy." Corded headphones instead of AirPods, for example, are a way for Gen Z to make an "anti-finance bro" statement.
They've also been lusting after an "old money" aesthetic characterized by Oxford shirts, tennis skirts, and tweed blazers, a sharp contrast from the "California rich" look of the Kardashians and the casual outfits of the new millennial billionaire class that characterized the 2010s.
Prior to the pandemic, the VSCO girl had the internet buzzing. Characterized by a natural look that embodied a crossover between '90s fashion and a surfer lifestyle, she was a contrast to the contoured faces and lip fillers of Instagram influencers. Gen Z's continued embrace of nostalgia is showing she was no fluke, but the harbinger of a new (old) look.
Their love for nostalgia explains why the typical Gen Zer likes to shop at thrift stores.
Thrifting is booming thanks to Gen Zers in search of sustainable, stylish clothes.
"I've kind of stopped buying clothes from traditional stores," Gen Zer Grace Snelling told Axios. "People almost respect you if what you're wearing is thrifted, and it looks good because you've managed to pull off a cool outfit, and it's sustainable."
Recycling and reselling clothes helps the digitally native generation wear new-to-them outfits on a budget they haven't yet posted to social, avoiding repeating looks. It's also a tool to start a lucrative side hustle, in which some are raking in as much as $300,000 a year on apps like Depop and Poshmark.
The trend goes beyond clothing. Gen Z (and millennials) are even increasingly eschewing mass-market home decor for vintage furniture, Insider's Avery Hartmans reported.
It's not just fashion. The typical post-college Gen Zer is taking their contrarian views to the workplace.
Gen Z is asserting new norms in the workplace, and eschewing the ones implemented by millennials before them. The New York Times' Emma Goldberg wrote that young 20-somethings are challenging tradition by delegating work to their boss, asking for mental health days, working less once they've accomplished their tasks for the day, and setting their own hours.
It's part of what Erika Rodriguez called a "slow-up" in a recent opinion piece for the Guardian, referring to a permanent shift in slowing down productivity with the aim of having more separation from work.
But some Gen Zers are quitting their jobs altogether, in what LinkedIn CEO Ryan Roslansky called a "Great Reshuffle." He said his team tracked the percentage of LinkedIn members who changed the jobs listed in their profile and found that Gen Z's job transitions have increased by 80% during that time frame.
In August, a study by Personal Capital and The Harris Poll found that a whopping 91% of Gen Zers were keen to switch jobs, more than any other generation. While some are seeking greener pastures in other jobs, others are opting out of working altogether, bolstering the "antiwork" movement that embraces a work-free lifestyle.
While the vast majority of Gen Zers haven't yet entered the workforce, it stands to reason they'll be just as, if not more so, progressive than their older peers.
They're also creative, entrepreneurial, and innovative both inside and outside work.
"Gen Z is innovative and powerful," Emma Havighorst, a 2020 graduate, told Insider last year. "The way we see the world is very different from prior generations."
For three years, Havighorst has hosted the podcast "Generation Slay," which profiles Gen Z creators and entrepreneurs like mental-health advocate Gabby Frost and nonprofit founder Ziad Ahmed. She said she thinks the pandemic will produce even more innovators.
"Necessity breeds invention," she said. "We'll be trying to figure out solutions to problems that plagued past generations."
Consider high schoolers Daniel Lan and Jalen Xing, who created homemade face shields for hospitals during the pandemic, starting the initiative Students for Hospitals.
More than half (58%) of Gen Z respondents in a DoSomething Strategic survey said that, since the pandemic, they had picked up a new activity or were doing more of something they already enjoyed.
But perhaps most significantly of all, the typical Gen Zer is ready for change — and they'll do what it takes to make that happen.
A generation whose childhood was defined by international protest movements including Occupy Wall Street and the Arab Spring, Gen Z has been at the forefront of activism, from the March for Our Lives anti-gun protest and the climate change movement. Arguably its most famous member is the climate-crisis activist Greta Thunberg.
2020 also put the generation front and center in the anti-police-brutality demonstrations sparked by the killing of George Floyd, a Black man who was murdered by a white police officer in Minneapolis. Social networking app Yubo and Insider polled 38,919 US-based Gen Zers, and found that 77% of respondents had attended a protest to support equality for Black Americans.
The generation also played a pivotal role in the 2020 election, Insider's Juliana Kaplan reported, which may have finally captured the elusive youth turnout. Tufts University's Center for Information and Research on Civic Learning & Engagement (CIRCLE) revealed youth voter turnout for 2020 was up by at least 5% from 2016 — and could have been up by as much as 9%.
It seems, then, that change may start with Gen Z.
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