The Economic Influence of a New Generation
A new generation, Gen Z, is rapidly transforming the global economy with a staggering $450 billion in annual spending power. As they transition into adulthood, their financial influence will only increase, and businesses need to align with their unique values. Known for being tech-savvy, entrepreneurial, and deeply committed to authenticity, diversity, and social responsibility, this generation is unlike any before.
One of the most significant aspects of this generation is its diversity—nearly half identify as people of color. This diversity is shaping consumer preferences in profound ways. In the U.S., 57% of consumers say that multicultural and diverse communities affect their brand choices, with this impact even stronger among younger generations. They actively seek out brands that represent their communities and support diversity meaningfully.
Right now, this generation accounts for 5% of global retail spending, but that figure is set to triple, reaching 17% by 2030. By 2031, they will make up 31% of the U.S. workforce, a significant increase from 15% in 2022. Their influence is not only felt in their current spending but will shape the future economy as they take on more purchasing power.
Beyond their buying power, values are at the heart of this generation’s decision-making. Diversity and inclusion are essential, but they expect more than just surface-level representation in ads. This group wants brands to understand and address the needs of different communities, both in product offerings and in corporate culture. Companies that fail to genuinely engage with these values risk losing their trust.
Social causes are also deeply important, especially issues like climate change and mental health. They favor brands that take a clear stand on these topics. Businesses that adopt sustainable practices or prioritize employee well-being through mental health support are likely to gain loyalty from this values-driven generation.
Connecting with this generation requires authenticity. They value transparency and honesty, and brands that fail to deliver will quickly lose their trust. Engaging with them on their preferred platforms, particularly social media, is crucial for fostering genuine relationships. These consumers are quick to detect inauthentic efforts, and brands that can build meaningful connections will be positioned for long-term success.
As they continue to grow in economic influence, businesses that adapt to their preferences and align with their values will thrive. Companies that embrace diversity, social responsibility, and sustainability will capture their loyalty and ensure a strong presence in the evolving market. new generation economic influence