Generation Z now has an ETF that reflects its values Oliver Wyman declined to name the brands it surveyed. "If a recession happens, then I will 100 per cent buy less or maybe even stop buying altogether," said US-based luxury lifestyle and travel TikToker Jeffrey Huang, 28, who shares his Louis Vuitton shopping trips and hauls with his 150,000 followers.Ī recent Oliver Wyman study showed that some luxury brands are significantly lowering their sales expectations for the Chinese market in response to current conditions, with 80 per cent of executives questioned not expecting a "V-shaped" recovery this year. "This might be the first time that a lot of young adults (in China) are facing (such an) economic impact, so it will be a testing ground on how these consumers are going to spend on luxury items going forward," Chow said. Government data for July registers the unemployment rate of China's urban population aged 16 to 24 at a record 19.9 per cent, exacerbated by the impact of Covid-19 lockdowns and a crackdown on big tech firms that traditionally hired droves of graduates. Whereas in North America and Europe, inflation and a rising cost-of-living are hitting discretionary incomes of young consumers especially hard, China's problem is different. Young adults around the world have been "a very strong factor of luxury growth over the past decade", said Gregory Boutte, chief client and digital officer at Gucci-owner Kering.ĭata this week showed China's economy slowed unexpectedly, prompting a central bank rate cut, while macroeconomic trends are disproportionately affecting the extra funds that those born between 19 might use to enter the world of luxury.
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From $300 bucket hats to $900 trainers and $700 T-shirts, the high-flying luxury sector is fretting over the appetite among financially stretched Gen Z consumers for such "aspirational" purchases.Įxecutives are troubled in particular by a hit to young Chinese shoppers, not only because mainland China has been a major driver of the industry's growth in recent years, but also because high end consumers in the world's second-largest economy are a decade younger than the global average of 38.