TheJakartaPost
Please Update your browser
Your browser is out of date, and may not be compatible with our website. A list of the most popular web browsers can be found below.
Just click on the icons to get to the download page.
Youth consumption and its challenges
Data on consumer behavior among younger demographics relative to older generations can inform both businesses and policymakers in anticipating measures to address potential challenges, especially adverse economic impacts related to youth unemployment.
Change text size
Gift Premium Articles
to Anyone
Share the best of The Jakarta Post with friends, family, or colleagues. As a subscriber, you can gift 3 to 5 articles each month that anyone can read—no subscription needed!
A man browses footwear displayed on Aug. 29, 2024 at an outlet in Grand Indonesia shopping mall in Central Jakarta. (Antara/Aprillio Akbar)
A
s the economy expands, so does its consumer landscape, with one of these changes driven by the emergence of Generation Z (Gen Z), or people born between 1997 and 2012 and currently ranging in age from 12 to 27 who have grown up in a rapidly changing world. Massive digital transformation is driving this change that is also resulting in a new economic reality.
In 2023, Gen Z Indonesians accounted for 26 percent of the total population, surpassing millennials at 24 percent, Gen X at 21 percent, baby boomers at 14 percent and younger generations at 16 percent. Gen Z is dominant in terms of not only population size, but also consumption patterns.
In 2013, Gen Z accounted for 30 percent of the total population, the highest proportion among all generations. Nonetheless, Gen Z contributed only 27 percent to national consumption in 2013, slightly less than millennials at 26 percent of the population and 28 percent of national consumption. Just a decade later in 2023 however, Gen Z was the leading contributor to national consumption at 25 percent, slightly ahead of millennials at 24 percent.
Observing the shift in demographic patterns and anticipating future consumption trends, Mandiri Institute conducted a survey last year of over 1,000 urban respondents nationwide to better understand their consumption behavior, particularly in lifestyle and banking.
We see that Gen Z has a stronger desire to engage in lifestyle activities such as travel, culinary experiences, entertainment and healthy living than older generations, as reflected in net activity intention (NAI), or the difference between respondents wanting to increase activities and those wanting to decrease activities.
However, leading a healthy lifestyle is popular across all generations. NAI is positive across all generations, with Gen Z taking the lead at 19 percent, followed by millennials at 5 percent and Gen X at 5 percent. This is also evident in the Mandiri Spending Index, which shows that spending on sports and equipment (outfits, gear, etc.) has increased significantly this year. At the same time, medical spending on medicines and vitamins has remained relatively stable.
In addition to a healthy lifestyle, Gen Z also has a high NAI for culinary experiences (17 percent), travel (8 percent) and attending shows (7 percent).
