Agencies
Singapore
In the face of a deteriorating Chinese economy, a shift in spending habits is becoming increasingly evident, particularly among the nation’s youth. These young individuals, navigating through economic turmoil, have adopted a more frugal approach to theirexpenditures.
They exercise caution with each penny spent, meticulously comparing prices across various platforms and seeking out additional discounts. Their quest for value has led them to frequent modest eateries, where they can satiate their appetites without straining their wallets. This conscious curtailing of expenses is driven by a desire to secure their financial future.
These prudent spenders, aged between 15 and 29, form part of what is known as Generation Z. They represent approximately 18.4 percent of China’s total population of 1.4 billion. According to recent research studies, this demographic is poised to play a pivotal role in shaping future consumption patterns and child-rearing practices. Their current frugality may well be a sign of the times to come.
Simultaneously grappling with the dual burdens of economic volatility and an aging society, China’s Generation Z finds itself in a precarious position. Despite China’s first-quarter gross domestic product experiencing a 5.3 percent annual growth, surpassing expectations, the majority of projections indicate a persistent deceleration in the forthcoming years. Compounding this is the unsettling unemployment rate of 15.3 percent among individuals aged 16 to 24 as of February, a figure that significantly overshadows the national average of 5.3 percent.
The habits of Generation Z, shaped by these mounting pressures, are poised to influence the trajectory of the world’s second-largest economy for years to come.
Terms such as “reverse consumption” and “stingy economy” have emerged as buzzwords on Chinese social media, encapsulating the shift towards a more judicious spending approach among a generation nurtured in a period of swift economic growth and escalating living standards.
The term “narcissism” is also gaining popularity, not as a synonym for “selfishness,” but as an affirmation of self-care and self-acceptance, further illustrating the evolving mind set of this generation.
The sense of uncertainties has become so strong among the youths that they have developed a deep sense of doubt and disillusionment about the promise given to them since they were young, said Biao Xiang, an anthropologist researcher on China at Germany’s Max Planck institute.
A study focusing on the habits of Generation Z, conducted by the Chinese social media platform Soul, revealed interesting insights. During the Singles Day shopping festival, it was found that 43.4 percent of Gen Z users made purchases with a specific intent, and over 30 percent of them compared prices across various platforms before finalizing their purchase.
Soul, which boasts a user base comprising approximately 80 percent of Generation Z, has pinpointed frugality and self-love as the defining trends for the year 2024. The study also highlighted other trending terms among Gen Z users, such as “lazy health,” indicating a preference for cost-effective wellness practices like adequate sleep; “city walks,” referring to leisurely city strolls; and “special forces travel,” denoting short, activity-packed trips designed to optimize time and minimize expenditure.
Julienna Law, the managing editor at Jing Daily, a publication specializing in consumer trends, noted the emergence of the “stingy economy.” She observed that cost-saving activities, such as dining at community canteens and shopping at discount snack stores, have gained popularity as effective money-saving strategies.
To save money, Chinese youths have started buying “leftover mystery boxes”. These boxes carry unsold food from restaurants and are often sold on different social media platforms like Xiaohongshu and the WeChat messaging app. By ordering these mystery boxes, many youths are saving 20 to 30 yuan on average. The sluggish Chinese economy has forced them to spend less. Household spending remains sluggish due to a prolonged property market slump, and even retail growth has slowed down. All these factors have shaken the confidence of the people.
It is worth noting that the degradation of consumption has far-reaching ramifications for the economy.
