Gen Z and millennials are ‘doom spending’

Retail therapy’s online shopping update is here, and it’s not pretty

27 September 2024 - 12:37 By Sandiso Ngubane
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Young shoppers are chasing after luxury items. Stock photo.
Young shoppers are chasing after luxury items. Stock photo.
Image: 123RF/halfbottle

Everywhere you look on social media and in real life it seems everyone is living la vida loca, purchasing the latest gadgets and splurging on designer goods and travel.

Recently I had to remind a friend whose job makes her one of the country’s top earners that she hasn’t done anything wrong by not being able to afford luxury goods such as the Loewe shades or Le Creuset pots she sees others buying. It’s a hard pill to swallow for anyone, watching your age mates and strangers on social media living seemingly large lives while you “can’t afford to buy the home I live in”, like my friend.

Considering the economic hardships — which don’t seem to be getting better with time — one would think people would be tightening their belts or buying less, but it looks like retail therapy has a new name for millennials and Gen Z, as adulthood continues to dribble us. While my friend is feeling the pressure, you may be, too, and probably engaging in what experts are describing as “doom spending”.

Doom spending is described by Euronews and other outlets as “spending excessive amounts of money on luxury things or experiences, such as travel, to deal with concerns about your own finances or the general economic situation. People may feel like there’s no point in saving, they feel they won’t be able to achieve their financial goals, and may as well live in the moment”.

Millennials and Gen Z are post-boomer generations whose journey into adulthood has been marred by multiple global crises, including several recessions. It appears we are shopping to fill an endless void of weariness with world affairs and having worse economic prospects than those of generations before us. We’re turning to luxury for it, buying into status symbols to offset our disappointment and perhaps keep up with the Joneses.

Unaffordable housing

Few of us are buying homes and other assets traditionally seen as worthy of investment, but we are shopping away on fashion, watches and other such items in ways generations before us never did. Can you blame us? If there’s no chance I can afford a home, maybe an expensive purse or shoes might give me a temporary sense of control, that I, too, may feel a tiny bit like the adult I’m supposed to be, one who can afford to live, and not only get by.

Being able to own property and cope with inflation feels increasingly out of reach for many of us . The top economic concerns among Americans, according to a study by Qualtrics on behalf of Intuit Credit Karma, include inflation (56%), the cost of living (50%) and unaffordable housing (23%). Of those polled nearly half (48%) said they worry about not having enough money to afford necessities such as food, clothing and rent. The picture is worse in South Africa, where youth unemployment was cited as the top concern by 64% of South Africans, according to a “What Worries the World” survey by Ipsos released in 2023. 

The challenge of unemployment

In an accompanying press release, Ipsos said: “The challenge of unemployment in SA is compounded by the uneven distribution of joblessness across the population. The youth are disproportionately affected, with a staggering 61% of those aged 15 to 24 unemployed during the last quarter of 2022. Even more concerning is that 33.6% (or 3.4-million out of 10.2-million) young people in the age group are not in employment, education or training. This is not only a significant social and economic issue but also a potential source of political instability.”

It adds “nearly a quarter of Gen Z respondents (23%) say they’re most worried about a lack of high-paying jobs, decreasing wages (21%) and general job security (16%)”.

It’s a gloomy picture that confirms our anxieties are not misplaced. The anxiety is compounded by other factors that make us the perfect candidates for doom spending: social media pressures and the rise of buy-now, pay-later (BNPL) schemes which have taken off in e-commerce specifically, granting those of us who lack restraint, and some who may be pushed that far for survival, to get into more debt. 


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