Despite record-high youth unemployment and economic challenges in China, Generation Z (Gen Z) is spending more on leisure and experiences, such as cinema tickets, beauty services, and visits to bars and sporting events, according to a report by Mintel Group. In August, 40% of respondents in this age group increased their spending on leisure activities compared to the previous month, outpacing other categories like clothing. Travel and leisure are the two areas witnessing consistent spending growth among Chinese youth this year, defying rising unemployment rates.
Mintel senior research analyst Blair Zhang noted that “experience-led spending, from going to the cinema and visiting exhibitions to exercising outdoors, has become the mainstream way for Gen Z to resume their lives post-Covid.”
While China’s youth are crucial for the country’s consumer market growth, the economy is grappling with post-pandemic challenges, including reduced hiring by companies. The jobless rate for individuals aged 16 to 24 hit a record 22% in June before authorities halted the data, fueling concerns of a higher real unemployment rate.
Rather than cutting back on spending, Gen Z consumers are reevaluating their priorities. Many are opting for affordable experiences over big-ticket items or long-term financial goals. Domestic tourism and entertainment, such as China’s booming box office, are thriving, as overseas travel remains out of reach for many.
Some Gen Z individuals, discouraged by the tough job market, have decided to focus on enjoying life now rather than pursuing traditional career paths. The “lying flat” movement, which advocates opting out of the competitive job market, has gained popularity among Chinese Gen Zs in response to the pressure to excel professionally.
While traditional sectors in China are still seeing strong consumption, retailers catering to young consumers are voicing concerns about the economic uncertainty and relying on discounts and promotions to boost sales. Young consumers are also becoming more price-conscious, seeking cheaper options when they shop.
Despite economic challenges, brands are focusing on marketing campaigns that promote self-worth, self-expression, and emotions among Gen Z consumers. Luxury brand Coach, for example, aims to build self-confidence and resilience in the face of a tight job market through its campaigns.
In conclusion, despite economic difficulties and high youth unemployment, China’s Gen Z is prioritizing experiences and leisure spending, reshaping their priorities in response to the challenging job market. Brands are adapting their marketing strategies to resonate with this trend, emphasizing self-expression and self-worth.
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