FINANCIAL OUTLOOK By Generation

It is generally thought that there are seven living generations inhabiting planet Earth at this point in time:

The Greatest Generation (born 1901-1927)

The Silent Generation (born 1928-1945)

Baby Boomers (born 1946-1964)

Generation X (born 1965-1980)

Generation Y or Millennials (born 1981-1995)

Generation Z or Zoomers (born 1996-2010)

Generation Alpha (born 2011-2025)

Much is often made of the generation gap, or the differences in values and attitudes that lead to a lack of understanding between representatives of these groups. The four groups we're interested in for purposes of this article are the Boomers, Gen Xers, Millennials and Zoomers — in other words, the range of ages that most likely reflect the generational diversity of the modern workplace today. And although this diversity can lead to ageism tensions in the work environment — younger people thinking older staff members are too conservative in their outlook and older people thinking their younger co-workers are too flaky — a basic understanding of what keeps these four groups ticking can perhaps foster a more harmonious multigenerational space for everybody to co-exist. And whilst the obvious difference that exists amongst these groups is the variation in ages, one less obvious dissimilarity is the way they view money.

Baby Boomers and Gen Xers

Of these four groups, Boomers, now between 58 and 76 years old, have had to adapt to technology the most. This has been a particularly difficult thing for them because Internet access became a thing in 1995, so they would have been long into adulthood by then, with the youngest of them being about 31, the oldest being 49 at the time. The youngest of them would have been born only two years after Independence, and so were understandably sceptical about the "new-fangled" Internet, which so many of them saw as a mere passing fad. They were from that school that believed in the integrity of hard work and were suspicious of a system that was now advancing technology.

But their work ethic has always been solid, and they need to be acknowledged for their hard work. During the pandemic, for example, it's likely that they were the ones turning up for work in-office rather than working from home. So it can be jarring when a younger co-worker who seems to be coasting, putting in fewer hours, embarks on the professional fast track practically overnight, suddenly becoming their bosses and supervisors. They hate a feeling of invisibility in the office and need to not just be seen but also rewarded, financially and otherwise.

An important aspect of this generation is that they are generally working for much longer than their parents' generation because of, among other things, increased life expectancy. So they are just now hitting their stride and are very concerned with financial security. They are taking longer to retire than previous generations and are generally thought to have the most economic influence, especially older boomers. In fact, statistics show that American boomers currently hold 51 per cent of all the wealth in the United States.

Per the Statistical Institute of Jamaica (Statin), as at April 2022, the Jamaican labour force was comprised of only 216,500 people between 55 and 65+, while there were 669,500 people between 25 and 44. So boomers and Gen Xers are not the largest group in the workforce, but by the sheer length of being employed, they have amassed more in terms of wealth than millennials, who have been working for a relatively shorter time. Still, a looming concern for boomers and Gen Xers is how they will be able to afford and manage a quality lifestyle, health care (a particular source of anxiety now that sickness becomes a distinct possibility), and debt loads from mortgage and credit cards, after their careers are over, especially older Boomers, who are living longer and who may not be as well-prepared for the reality of retirement.

Gen Xers, now between 42 and 57 years old, though integrating some of the Baby Boomers' philosophy about life, have a point of departure, generally in their outlook on work-life balance. So whilst they are independent and self-sufficient, able to leverage their MacGyver-like talent for problem-solving to advance their careers and hence becoming highly valuable to their employers, this generation nevertheless understands the value of not making the job their lives.

They are passionate about trying to find a healthy balance between their work and personal lives and interests. It's not uncommon to find a Gen Xer working in an office by day and hosting a poetry reading by night. However, they are experiencing a growing frustration now that economic times have begun to get difficult. The older ones are finding they are on the cusp of retirement and are really not equipped for it, what with the shrinking value of their money. So they are concerned about side hustles and are furtively pursuing effective ways of saving and investing. They, too, carry debt loads, but because of their can-do spirit adopted from coming of age in the 80s and 90s, are finding it easier than boomers to parlay their passion into something that can make money for them — entrepreneurial projects or freelancing, for example. They came of age during the hard economic times of the eighties, after all.

Meanwhile, younger Gen Xers — who witnessed their parents coping through the difficult era of the 80s, dictated by a financial monetary policy spurred by strict IMF conditionalities — learned the mantra of "tun yuh han' mek fashion". The current harsh economic climate brought on by the pandemic doesn't truly faze them because, in their minds, there must be a way out.

Next week: Millennials and Zoomers

Lamar Harris, vice-president, wealth management, NCB Capital Markets

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