retail news in context, analysis with attitude

by Kevin Coupe

The San Francisco Chronicle had a story the other day that was running, in one form or another, in newspapers and news sites all over the country, reporting on a new, economic generation gap that seems to be growing in this country.

According to the story, a study from the Pew Research Center says that “the wealth gap between younger and older Americans has stretched to the widest on record, worsened by a prolonged economic downturn that has wiped out job opportunities for young adults and saddled them with housing and college debt. The typical U.S. household headed by a person age 65 or older has a net worth 47 times greater than a household headed by someone under 35, according to an analysis of census data being released today.”

This wealth gap is double what it was just six years ago, and five times what it was in 1985.

Now, this is not to say that either group has not been hit hard by current economic conditions...but younger people seem to be taking it on the chin more than people 65 or older. The median net worth of households headed by someone 65 or older is down 42 percent compared to 1984, while it is down 68 percent for younger-age households.

There’s an interesting comment in the story from Harry Holzer, a labor economist and public policy professor at Georgetown University: "It makes us wonder whether the extraordinary amount of resources we spend on retirees and their health care should be at least partially reallocated to those who are hurting worse than them.”

Not only do these numbers suggest a marketing path that ought to be considered by retailers trying to tap into the psyche of this younger generation, but they also point to factors that ought to be taken into consideration by companies looking to hire people of this generation; there may be a fragility to their economic state that can be addressed by employers, and that can be exploited - in the best sense of the word - to create stronger connections and institutional loyalty.
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