For Generation Z and millennial people in countries around the world, anxiety levels are high. Almost half of Generation Z (48%) and millennials (44%) say they are stressed most of the time, according to Deloitte’s Millennium Survey 2020, released Thursday. The causes of high stress are rooted in financial concerns, family well-being, and professional expectations. But don’t put the Covid-19 pandemic at the top of that list.
The coronavirus outbreak has caused an economic recession in the US. USA And across the world, and even amid some signs of rebound, uncertainty continues to weigh on the global economy and markets. But since the pandemic began, some younger people have become more positive about their short-term financial outlook and less stressed overall, according to Deloitte’s annual survey.
Wesley Richardson, a recent graduate of the University of Southern California, said being home during the pandemic resulted in greater savings and financial awareness. “Now that I’ve graduated, I’ve been thinking about what I want my priorities to be in terms of what I spend my money on once I live alone. Having to sit at home all day and thinking about what having to do with my time has made me helped do that … I really don’t care so much about living a lavish lifestyle, I’m just giving myself priority, “said Richardson.
Millennials and Generation Z worldwide are more concerned with finances and careers, according to a Deloitte survey conducted before and after the pandemic.
Deloitte Millennial Survey 2020
An event like Covid-19 can be hopeless, especially when it comes to finances, said Brad Klontz, financial planner and financial psychologist, but that makes taking an approach similar to Richardson’s even more important.
“The biggest challenge is avoiding that feeling of learned helplessness, when you have an external locus of control and you have the circumstance that your life is out of control,” said Klontz. “It’s the people who are finding ways to find opportunities and have an opportunity mindset: those are the people who are going to come out of this success,” said the behavioral finance expert.
Michele Parmelee, Deloitte’s director of personnel and global purpose, said that millennials and generation Z around the world are taking greater personal responsibility for decisions, and that includes finances, but it also goes much further, to the climate, as well as relations with companies and employers. .
The Deloitte 2020 Millennial Survey was conducted in two waves. The first collected responses from more than 18,000 individuals, including millennials in 43 countries and Generation Z individuals in 20 countries, from November 2019 to the first week of January 2020. A second “pulse” survey was conducted. smallest in April and May 2020, as a result of the coronavirus pandemic, among 9,100 individuals in 13 countries.
It was during the follow-up survey that anxiety levels decreased. Millennials who said they felt stressed most of the time fell 8%, and that the decrease in stress coincided with Generation Z.
The financial situation is a major stressor
Finances remain a particular stress point. Most millennials (67%) and Generation Z (64%) say they often care about their financial situation, and between the two generations, the follow-up survey found a decrease in those who believe their personal financial outlook will improve. in the next year.
Among US respondents, overall financial concerns are even higher, cited by 77% of millennials and 66% of Generation Z. There were also significant declines in the 12-month financial perspective, with the US millennium generation. . USA Who believes that their situation will improve, falling from 54% to 42%, and among generation Z a decrease from 45% to 36%.
Deloitte’s follow-up survey after the start of the virus outbreak found that nearly a third (31%) of millennials and 38% of Generation Z said they would not be able to recover financially if faced with heavy spending during this time. However, respondents also indicated fewer problems paying recent bills, which could stem from a combination of entrenched saving habits, as well as government financial aid efforts around the world. Stress levels related to day-to-day finances decreased among members of both generations.
US respondents USA They were noted for having more trouble paying bills than their global counterparts, on average, especially US millennials: in the pre-pandemic survey, 47% said they missed a payment in the past six months; That fell to 39% in monitoring the coronavirus but was still significantly higher than other generational pairs worldwide.
Many younger people around the world struggle to meet sudden financial needs, but millennials and Generation Z have seen short-term financial relief since the pandemic began.
Deloitte Millennial Survey 2020
While personal stress levels are still high, the declines recorded by the survey since the Covid-19 outbreak may be specifically related to a decrease in commitments such as travel, including travel and the more flexible environment created by sudden mass migration to remote work, Parmelee said. Changes as simple as having a cat or your children sitting at their desks next to them help increase feelings of a “real” being represented at work, she said. More time with family and a general slowdown in life may also be contributing factors, according to Deloitte’s survey.
Sixty-nine percent of millennials and 64% of Generation Z said having the opportunity to work from home in the future would reduce stress, and more than half of respondents from both generations (56%) said that if they could work remotely they would move out of major cities.
It should come as no surprise that the world’s youngest citizens have proven resilient, Parmelee said, given the economic vomiting in which they grew up and started their working lives. “They have faced many difficulties … during the Great Recession and now here,” he said. “Millennials learned from the Great Recession. They learned by looking at their parents and what they experienced and are wiser than previous generations … They need to be more thoughtful, and we know they said that even before the pandemic.”
Resistance does not mean that these generations escaped the economic damage of the recession. For many, the pandemic has caused the loss of jobs or, at least, the reduction of hours, reductions in income and bonuses, unpaid licenses and withdrawn job offers.
Millennium generation and Z generation workers worldwide have seen significant labor impacts from the Covid-19 crisis.
Deloitte Millennial Survey 2020
“Certainly people were affected in their ability to work, but they showed readiness in terms of financial responsibility, budget, savings and investment and not having a high degree of loans,” said Parmelee.
Millennials who conducted the initial pre-pandemic survey said 40% of discretionary spending goes to saving and investing; with 48% “fun” expenses. That savings and investment figure is much lower for Generation Z (35%), but Richardson’s example suggests that the younger generation may see the current crisis as an impetus to focus more on financial security early in life. adult.
Richardson said he has used this time at home to learn more about financial preparation. “Definitely more conscious about saving … I’ve been reading books on financial independence. Having to sit at home all day and thinking about what to do with my time has helped me do that,” said the recent USC graduate.
Klontz said that some of the smarter personal finances have been forced. “A lot of people have had to restrict themselves, a lot of people are making less money and adjusting to that provides an opportunity to have a clearer idea of how they spend their money,” he said. But Klontz added: “Some people have really taken advantage of the opportunity. Some people have used this to take a close look at their cash flow, their spending habits … I think people are really understanding why they would need an emergency fund.”
As the saying goes: never let a crisis go to waste.
“This type of crisis gives you the perfect opportunity to develop a plan,” said Klontz. “Even though cash is not flowing right now, there is a real opportunity to consider developing a plan and paying yourself first and executing the things that matter most.”
A couple in masks sits on a bench watching the sun set over the Manhattan skyline in Domino Park, Brooklyn, amid the coronavirus pandemic on May 21, 2020 in New York City.
Alexi Rosenfeld | fake pictures
Parmelee said the high level of anxiety among younger people can translate into a greater awareness that they cannot afford to take their eyes off the ball. Being financially stable and understanding how quickly things can change in terms of perspective is essential, especially at the beginning of careers, when members of these generations may be beginning to support others, both children and older parents. “They are so aware that they need to focus on it,” he said.
Short-term stress reduction should not be confused with a generally positive outlook among members of these generations. In fact, far fewer millennials (26%) and Gen Z (28%) expect to be happier than their parents. And a mood score calculated by Deloitte’s annual survey, which takes into account economic sentiment, personal finances, the social / political situation, the environment, and the impact of the business world on society, recorded pessimistic readings which increased in the next Covid-19 survey. With a score of 50 representing half of the respondents who believe that progress is being made, both the millennium generation (32) and the Z generation (35) were well below that mark.
Specifically in the USA. In the US, the millennium score fell from 52 before the pandemic to 39 during the pandemic. For Generation Z, it decreased from 39 to 34.
“They were certainly more pessimistic than in the past, and in the pulse survey, during the pandemic, even less optimistic,” Parmelee said.
—Additional report by Eric Rosenbaum of CNBC
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