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Since their emergence as the youth market decades ago, Baby Boomers have expanded the consumer demand of each life stage or demographic they’ve passed through. Always avid consumers, Boomers promise to do the same at the senior stage, according to a recent analysis by McClatchy.
While the discussion of Boomer aging has centered the effects of their retirements and entitlement demands, others see a key consumer generation entering a whole new market phase. “It’s only in Washington that 100 million people are viewed as an unaffordable cost and financial burden,” said an AARP exec of the new seniors. “In the private sector, 100 million people are called a market and an opportunity.”
Previous generations have been marked by restrained spending in the senior years but Boomers project to continue their avid consumption and to enter new markets as they age. Planners in retirement communities are rethinking their development plans to include shopping and sporting centers to cater to Boomer lifestyles. As Boomers strive to preserve their quality of life, demand for fitness trainers is expected to increase 24%. As they cope with the effects of aging, demand for home health assistance is expected to rise 70%.
“We became the generation of consumption and personal gratification,” said one Boomer analyst. “Boomers are not going to spend at all like the prior generations did at 65. They’re going to spend at Boomer levels. And there’s millions more of them.”
While there are many threats to the performance of equity markets, the onslaught of Baby Boomer retirements will not be one of them, according to financial analysts. While events like the “fiscal cliff” or downturns like the one in 2008 will continue to affect market performance, the fear that a mass of retiring Boomers pulling their money out of equities would crash the markets is unfounded.
While large numbers of Baby Boomers have begun to reach retirement age, their retirements should have little impact on the value of equities. For one, those retirements will be spread over 25 to 30 years, hardly a sudden, massive withdrawal. Secondly, retirees will continue to hold some positions in equities over the course of their retirement years, again softening the impact. Third, the universe of employees who may fund their future retirements though an employer-sponsored fund is expanding, bringing new investors into the market.
All in all, analysts say an orderly transition in the market is much more likely than a “Boomer retirement cliff” that would suddenly sink the value of equities.
As the holiday shopping season shifts into high gear, Millennials and Baby Boomers both plan to spend, but each generation will shop in its own way. Millennials will use smartphone and online shopping about twice as much as Boomers. Boomers on the other hand, are much more likely to visit brick-and-mortar stores and use traditional coupons and sales.
Millennials and Gen Xers plan to spend about $820 on gifts this year while Baby Boomers plan to spend about $760. The big difference is in how they plan to spend the money. About half of Millennials will use smartphones to compare and research products and prices while less than a quarter of Boomers will do the same. And about a quarter of Millennials will actually make holiday purchases with their phones while less than 10% of Boomers will. Nearly two-thirds of Boomers say their phones will play no part in their shopping at all. Millennials (37%) are also more likely to use social networks in shopping than Boomers (23%).
Another generational difference: Millennials (77%) are more likely than older generations (44%) to shop for themselves during the holiday season, a practice called “self-gifting.”
As Baby Boomers work towards retirement and see their kids off to college, many are finding that they still have a major responsibility: caring for their parents. 40% of Boomers are caring for their aging parents, all of the Mature generation. And it’s definitely affecting their lives and work: nearly 70% of Boomers report missing work to take care of an elderly relative. 60% have employed caregivers, 10% have left work, and another 10% have reduced the number of hours they work.
Many are also caught between caring for their kids and their parents – the classic sandwich generation. But another 36% have care giving responsibilities for both their parents and their grandchildren – there’s four layers in that generational sandwich when you add it all up.
Given increasing longevity, the issues surrounding eldercare and multigenerational household responsibilities are likely to come up more and more frequently in the workplace and to affect retirement plans – giving a new dimension to the multi-generational issues facing the workforce.
Above is a link to an association write up of a program I put together for them on how to get their next generation of leaders prepared for roles of responsibility – how to work with the leaders of today and how to prepare yourself for leadership tomorrow. We seated everyone at rounds and made sure no two people from the same company was together so that the workshop portion could function most effectively. It was two hours long, all customized for this client, with super results. Below is the quote from my CII point of contact for the event:
“This was our first attempt at directly engaging the next generation of leaders and industry professionals during a Construction Industry Institute (CII) Annual Conference. Cam’s presentation and workshop entitled: ‘How to Achieve Success in Your workplace: An MBA of a Different Sort’ was very well received by our attendees, with high marks for presentation content and delivery. Cam’s comprehensive knowledge of workplace leadership trends and his ability to connect with the audience through relevant analogies and thought leadership at several levels was a great start for our conference! He was able to help our members understand how generational differences can impact their organizations, not only internally, but also with their business partners – and how developing communication skills, leadership, and accountability, adding value to the workplace, understanding the apprentice to master process, and working with a mentor can achieve impressive results. I would recommend this presentation to any company or organization that wants to attract, engage, and retain young talent.”
Kim Allen, CII Associate Director
Also, as something a bit different, I created an invitation video that went to CII members – both company owners and staff – to generate attendance. Click this link to watch the video: http://youtu.be/owNe13Mg5Gg
Millennials are finding it tough to land jobs and it’s not just because of the economy. In many cases, they may be their own worst enemies in the application and interview processes. Recruiting firm Adecco surveyed hiring managers and found them more likely to hire Boomers than Millennials, in many cases because of the mistakes that Millennials make when applying and interviewing.
Managers surveyed were three times more likely to hire a Boomer than a Millennial and they weighed in on the key mistakes that Millennials are making. The top mistake Millennials make is wearing inappropriate attire to an interview, according to 75% of the managers. Shorts and flip flops were named as examples. Just behind that on the list was inappropriate social media content. 70% of managers reported seeing offensive or compromising photos or personal information posted by Millennial applicants on sites like Facebook and Twitter. Only 19% of Boomer applicants seem to have that problem.
Other common mistakes included not doing enough research or preparation for an interview (62%) and failure to ask questions of interviewers, both of which betray a lack of motivation and interest. Finally, many hiring managers (57%) find Millennials applicants to be overconfident in their abilities and qualifications, perhaps not surprising in the “self esteem” generation.
Many Boomers who are retiring are choosing not to move away or, if they do, they are choosing non-traditional destinations. Increasingly, Boomer retirees are eschewing traditional Sun Belt retirement destinations like Arizona and Florida in favor of closer-to-home destinations in cooler climates like Maine and Washington state.
Places like Camden, Maine and Medford, Oregon are now routinely named on “best places to retire” lists. Fewer Boomers are opting for the traditional golf-centered retirement communities in warm climates. “That’s the old view of retirement,” said David Savageau, author of Retirement Places Rated. “And it’s kind of dying out, the desert Southwest and South Florida. That was for our parents; for us it might be somewhere closer to home, a college town, a ski resort or a historical area that gets some kind of tourism in season.”
Multiple generations in the workplace is now a full scale reality for most. Because they are working side by side, CareerBuilder conducted a side-by-side comparison of Older Boomers’ and Millennials’ attitudes at work, finding both similarities and differences:
• Both prefer face-to-face communication, Boomers (60%) slightly more than Millennials (55%). Millennials (35%) like email more than Boomers (28%) but both disdain the phone (<12%).
• Boomers (62%) are more likely to say you should stay at job for 3 or more years than Millennials (53%). Millennials (47%) believe you should move up once you’ve learned enough. If you do your job, Millennials (63%) say, you should be promoted regularly. Boomers (43%) aren’t so sure.
• Both will work till five, but Millennials (43%) are less likely than Boomers (53%) to get there early.
• Boomers are more likely to dive right into a project (by a margin of 66-52%) while Millennials prefer to make a written plan first (48-35%).
Many Baby Boomers are working past retirement by starting a second, or “encore,” career. Encore.org reports that 9 million Boomers have already launched their retirement careers. That’s about 10% and well more than the number of Boomers who have reached official retirement age.
In their encore careers, Boomers are often looking to do something meaningful or “make a difference.” In that respect, they mirror Millennials who favor jobs that have a purpose or social conscience.
Non-profits, education, and community work are obvious choices for meaningful work but Boomers are also finding meaning in starting their own businesses. Leading Edge (older) Boomers now have a higher rate of entrepreneurship than Millennials, accounting for nearly a quarter of all new business startups.
This week’s Grandparents’ Day is an appropriate time to notice that Baby Boomers now dominate the Grandparent demographic. According to statistics cited by Newsday, Boomers now make up a majority of grandparents. The average grandparent is a Leading Edge (Early) Boomer (64). The average new grandparent is a Late Boomer (47)
The new identity of many Boomers as grandparents is important because of their involvement and commitment, financial and otherwise, in the lives of their grandchildren. Boomer grandparents spend over $35 billion annually on their grandkids. Overall, 52% of grandparents help fund their grandchildren’s educations and 45% help pay for living expenses.
The close personal and financial relationships that Boomers have enjoyed with their children appear to extend to their grandchildren. This connection, and the spending that follows it will be an important consideration for anyone working with Boomers in their new roles as Grandpa and Grandma. Just remember they don’t like to be called that: http://www.grandparents.com/gp/content/expert-advice/family-matters/article/grandparent-names-barbara-graham.html