With rising incomes and a willingness to spend, Generation Z could have a profound impact on the economy and the market. The cohort’s global income levels are expected to increase from $9 trillion in 2023 to $36 trillion around 2030 and $74 trillion by 2040 — the largest of all generations, Bank of America said in a January note. In addition, more than $84 trillion in assets is expected to be transferred to younger generations, including Gen Z, by 2045, according to Cerulli Associates . At the same time, Gen Z is expected to grow their spending power to an estimated $12 trillion by 2030, according to NielsenIQ and World Data Lab’s global report on Gen Z spending . The oldest in the generation are in their late 20s, while the youngest are teens. Dates vary, with McKinsey putting the cohort’s birth years between 1996 and 2010, while McCrindle uses 1995 to 2009. NielsenIQ and World Data Lab said Gen Z is roughly defined as anyone born between 1997 and 2012. The generation was the first to be born into an online world, said Haim Israel, global strategist and head of thematic research at Bank of America. “They didn’t experience an offline moment in their lives and that has a huge impact on everything that they do — from consumer to banking to financial services to behavior to the health situation,” he said in an interview with CNBC. That will ultimately affect companies in those spaces. In addition, for the first time in history, the older generations are adapting to the younger generation, and not the other way around, Israel said. That means the impact is actually much bigger than just the size of the population, he said. “They are about to become the most disruptive to economies, markets and social systems,” he wrote in his January note. Gen Z’s impact on stocks The effect of Gen Z’s spending habits will be felt across a swath of sectors, including tech, retail and restaurants. One of the biggest and obvious beneficiaries is social media. Gen Z spends 2.5 hours daily across social media platforms, Bernstein said in an October report. Meta -owned Instagram is the social app most used by teens, with a monthly usage of 87%, according to Piper Sandler’s latest teen survey in October. The firm surveyed 13,000 teens across the United States. META 1Y mountain Meta Platforms Meta has also made a big push into short-form video, which is a draw for Gen Z. “This has demonstrated a very tangible result in terms of Instagram growing more popular, I would say, in…
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