Beyond Z: Meet Generation Alpha - McCrindle

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Well then, I’m going OK now. The head injury I got when I jumped out of my window when my room caught fire has nearly healed, although I do get regular migraines. Fortunately the fire and my jump were witnessed by a worker over the road. He called the ambulance, and he visited me in hospital. And since I had nowhere else to live because of my burned-out room he was kind enough to invite me to move in with him. Anyway we’ve fallen deeply in love and we’re planning to get married. We haven’t set the exact date yet but we’ll make sure we do before my pregnancy begins to show. Yes mum and dad, I’m pregnant. So I’ve decided to quit Uni, and I’ve quit my part-time job, I’ve sold off all that furniture that you lent me (I needed the cash), and I’m just going to hang out with this guy. He’s not educated or ambitious at all, but I’m sure you’ll accept him just as I have … Now that I’ve brought you up to date I just want to tell you that there was no fire in my room and I haven’t been to hospital or hurt myself. Also I haven’t quit uni or my job, nor sold any of your stuff, oh and by the way I’m not pregnant, nor engaged – in fact there’s no man in my life at all! However, it is true that I failed Chemistry, and I’m doing badly in Statistics, and I wanted you to see those marks in the proper perspective! Your loving daughter.7

10 BEYOND Z: MEET GENERATION ALPHA ‘Jesus replied: “When evening comes, you say, ‘It will be fair weather, for the sky is red,’ and in the morning, ‘Today it will be stormy, for the sky is red and overcast.’You know how to interpret the appearance of the sky, but you cannot interpret the signs of the times.”’ Matthew 16:2

Australia is currently experiencing unprecedented changes, namely as a result of its ageing population, which is impacting and will continue to impact on the family, school, workplace and marketplace. The ageing of the population poses one of the greatest challenges – if not the greatest – for governments and businesses around the world today. ‘Demographics are our destiny’, stated Peter Costello when he was Federal Treasurer. Treasury’s Intergenerational Report made clear the unique times we are in, and the challenges to come: ‘Currently, the proportion of 15–64 year olds in the population is higher than it has been for 40 years and higher than it is projected to be for the next 40 years – it is a demographic “sweet spot.”’1 Demographics give us insight into the future of our nation and allow us to make some forecasts about what future generations might be like. Our current generation

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of children is known as Generation Z. Until recently little has been said about this generation. Now they have hit their teens and generational experts have appeased some of our curiosity about Gen Z, our attention is beginning to turn to the next generation, born from 2010. What will the new generation be like – and what will it be called? What comes after Z? There is no denying that today’s Australia is very different to the one our parents and grandparents knew when they were young. We are all familiar with the stories our senior family members tell about the ‘good old days’. Change is undoubtedly inevitable. However, as we have seen, many of the current trends are unprecedented. When you put them all together it becomes evident just how much we have changed as a nation. The entire developed world is experiencing many of these radical changes too.

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• There have never been more women in the workforce. • There have never been more mothers in the workforce. • The number of children in paid care has never been higher. Health and demographics

• • • • •

Australians have never been more overweight. Death rates have never been lower. Life expectancy has never been higher. Australia’s population has never been older. Australia’s population has never been bigger.

Social statistics

• Church attendance has never been lower. • Crime rates have never been higher. • Number of police and prisoners to crime has never been lower.

Relationships and family life

• • • • •

Cohabitation has never been higher. Brides and grooms have never been older. Parents have never been older. Australian families have never been smaller. Homes have never been bigger, but backyards have never been smaller. • Household population has never been lower. • It has never taken longer to pay off a home. • The ratio of divorces to marriages has never been closer. Education and the workforce

• Australians have never been more educated (one in five Australians are university educated).

Naming the next generation In the USA during the 2005 Atlantic hurricane season, the alphabetical list of names was exhausted, so scientists looked to the Greek alphabet for names. This nomenclature of moving to the Greek alphabet after exhausting the Latin one has a long history with meteorologists. Scientists of all disciplines use the Greek alphabet as a labelling sequence and so it looks likely that the sociologists will follow this trend with the generations too. For now most demographers, social analysts and generational experts are still busy profiling the young Zeds. However, with some consensus on 2010 as the start year for the generation after the Zeds, a new label beckons. With gener-

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ational analysis having moved from a stage of foundation to consolidation, a more predictable labelling system is being formed. There being consensus on the alphabetised theme of Generations X, Y and Z, it is most likely that the new generation will be known as Generation Alpha. Generations Y and Z are often referred to as 21st-century generations. However, this upcoming generation is truly the first millennial generation because they are the first to be born into the 21st century (while some Zeds have been born into the 2000s, its oldest members were born at the tale end of the 20th century). In our survey on the generations we asked respondents what they thought the generation after Z might be called. For many, the logical answer to our question was ‘go back to the beginning’. Generation A was suggested by 25 per cent of our respondents and many also suggested Generation Alpha. The respondents who suggested Generation A and Alpha said the labels also signified what we can expect of this generation and their times: a new and positive beginning for all, with global warming and terrorism controlled. Respondents who suggested the following labels made similar comments: the Regeneration, Generation Hope, Generation New Age, the Saviours, Generation Y-not and the New Generation. Others suggested the label ‘the NeoConservatives’ because the upcoming generation will have grown up aware of their impact on the environment and the economy in the aftermath of the Kyoto agreement and the global recession. Some respondents suggested the label ‘the Millennium Generation’, perhaps appropriate given the fact that this next generation will be the first to have been born into the 21st century. However, this label will probably never be


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adopted; after all, both Generations Y and Z have already been referred to as the Millennials by demographers, writers, commentators and bloggers. Other suggested labels were reflective of our tech-centric age. Many of these labels have also been used to refer to Generations Y and Z and again for this reason probably won’t be taken up: Net Generation, the Onliners, Global Generation, Generation Tech, Generation Surf and the Technos. Generation Alpha would be an appropriate label. If we look at Strauss and Howe’s generational theory, the next generation is predicted to spend its childhood during a high. As we discussed in chapter 1, we are currently living through the crisis period of terrorism, the global recession and climate change. By the time Generation Alpha is born, these threats, among others – food shortages, rising housing prices and water shortages – may have subsided. If that happens then this generation will begin their lives at a new stage, a global generation beginning in a new reality.

The demography of the future I enjoy reading the work of futurists as they sketch unseen horizons. But my favourite futurist books are those written decades ago about life today. Only in these works can you check the accuracy of the forecasts and keep the futurists accountable! On my bookshelf alongside Alvin Toffler’s 1970 Future Shock and John Naisbitt’s 1982 work Megatrends is a book entitled How to Survive the 80s by Lewis R Walton and Herbert E Douglass, written about that decade long since passed. Some of the predictions made in these futurist works include that by the late 1980s offices would be paperless, by the late 1990s we would all be working from

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a home office rendering parking problems and traffic jams a thing of the past, and by the 2000s, thanks to the laboursaving devices in the office, we would only be working, on average, three-and-a-half days a week! The take away from this for me (apart from watching my own forward forecasts!) is that technology has a time horizon of months, the economy of perhaps a year or so, but only demography can give a clear forecast decades into the future. Yet a single extrapolation – even a demographic one – is unlikely to deliver great accuracy. Take my number crunching on Elvis impersonators: a quick Google search tells me that by the end of the year in which Elvis Presley died (1977) there were an estimated 54 professional Elvis impersonators. By the late 1980s this had jumped to over 5000! Based on this growth rate it can be quickly calculated that by late in the year 2018 more than 80 per cent of the people on the planet will be professional Elvis impersonators! Clearly for accurate trend forecasts, a multi-factorial approach is key. By triangulating on the future we can most accurately predict it. The next generation will be the children of Generation Y. Their grandparents will largely be the younger Boomers. By the time the oldest of this generation are a decade old (around 2020), there will be more 65 year olds than one year olds, and as many people aged 60–70 as there will be aged 10–20. In light of these figures, the next generation, very much like their older siblings the Zeds, will be a precious generation, prized and protected by their parents, as the population pyramid becomes increasingly rectangular. If current, long-standing fertility trends continue, there will be just 261 847 births in 2020 compared to nearly 300 000 in 2009, even though the population base will be


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12 per cent larger than today.While average family sizes will be comparable to the new slimline families of today, fewer women will have children in 2020. Generation Alpha will come of age in a time of unprecedented ageing, rising costs, emerging global challenges and the biggest intergenerational transfer of wealth and leadership succession ever seen. The costs of providing for a population edging closer to 30 million, as well as rebuilding infrastructure now half a century old, laid down in the growth years of the Baby Boom, will be enormous. In addition, retrofitting society in a carbon-costed era with a priority on environmental sustainability will be enormously expensive. And of course all of this comes as Australia hits the peak of its ageing, with the added pension, health and aged-care liabilities, and when the income tax-paying base begins to shrink. So from more PPPs (public private partnerships) to a society increasingly used to paying for once-public provisions (from public roads to toll roads, public health to private hospitals and public education to non-government schools), the world of Gen Alpha will be a privately funded one. Loneliness and depression will become increasingly significant problems for society as solo-person households, currently the fastest growing household type, dominate one-third of all households in 2020, bringing the average household population down to 2.3 persons, compared to 3.3 in the 1970s. By 2020 it is predicted that: • Australia’s median age will be almost 40 • there will be more people aged 50 (338 081) than any other age, reflecting the baby boom and migration boom of those born in 1970–71 • life expectancy at birth will exceed 84 years

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• more than one in five people will be aged over 60 • the average age in Japan will be 48 and in China it will be 37. By 2020, most of the Boomers will have retired, the X-ers, in their 40s and 50s, will be the business leaders and Gen Y, in their 20s and 30s, will dominate employment, comprising 35 per cent of the workforce (they comprise just 18 per cent today). The Zeds, now barely in their teens, will be beginning to enter the workforce. The Baby Boomers currently comprise a quarter of the population yet they own over half of the nation’s private wealth. In 2020 the oldest Boomers will have hit their mid-70s and we will witness the biggest intergenerational wealth transfer in history. Not only this but also the biggest leadership succession ever. By 2020 40 per cent of today’s managers in family and small business will have reached retirement age. In the USA one in five senior and managerial workers will retire in the next five years. By 2030 it is predicted that: • the largest age group will be 60 year olds • one in five Australians will be aged over 60 • the number of people aged 65 and over will be almost double what it is today • those aged over 65 will outnumber those aged under 15 • the number of people aged 85 and over will be almost three times larger than today. In terms of the workforce, earnings and consumption, by 2020: • voluntary annual turnover will be approaching 20 per cent • the casualisation of the workforce will continue to grow from today’s 30 per cent to almost 50 per cent


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• energy consumption will have increased by one-third and based on current technologies greenhouse gas emissions will be 20 per cent higher than today • the number of online ‘reputation attacks’ on corporations, initiated by online pranksters, activists or disaffected customers, will have increased fourfold. By the time Generation Alpha start to enter their 20s (2030s) they will be in unprecedented demand as workers. By 2030 the ratio of workers to retirees will be 3:1 (today it is 5:1) as more people exit the workforce than enter it. Those exiting work will be leaving full-time roles while the newer entrants will, naturally, be working fewer hours per week. This will add to the employment challenges. By 2030 the average annual household income will be $200 000. Today it is $50 000. With job tenure at an all-time low (less than three years, compared to four today), Generation Alpha will be the most job-fickle generation, having an average of six careers in their lifetime. They will commence high school when the rising costs of an ageing population on health care, pensions and aged services will have pushed the government into further debt. Generation Alpha will surpass even the praised and sophisticated Zeds in terms of education, with 90 per cent predicted to complete Year 12, compared to 75 per cent today, and with the majority going on to tertiary education in some form. As education inflation continues, the adult milestones will be pushed back even further. Once Generation Alpha leave high school, their parents can expect to wait in excess of 13 years before (and if) they become grandparents. More than one in three Alpha women will never have children. Today the three most populated countries in the world

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are China (1.33 billion), India (1.15 billion) and the USA (0.30 billion), while Australia (0.022 billion) is ranked 54th. In 2030 the three most populated countries will remain the same, with India surpassing China: India (1.53 billion), China (1.46 billion) and the USA (0.36 billion), while Australia (0.03 billion) will drop to 59th place. The population of the world currently stands at 6.7 billion. In 2030 it will have increased to 8.29 billion, most of the additional 1.59 billion people being members of Generation Alpha. The aged pension was introduced in 1909 and set to start at age 65 for males, where it still stands. Interestingly, the average life expectancy for males back then was just 58. Today it is 79. By the time Generation Alpha start to enter their 60s, Australian life expectancy will be at an alltime high and so the retirement age and pension age may be pushed back again. In May 2009 the Rudd Government announced that the retirement age will be raised to 67 by 2020. Even though this generation will live longer than any previous generation because of medical intervention, they will experience more health problems largely related to increasingly sedentary lives. The table below shows the ageing of Australia’s population and how Gen X, when they are aged 65–75 will live longer, be more numerous, and comprise a greater proportion of the population than any previous generation of older Australians. Indeed, by the time today’s X-ers and Y-ers reach their senior years the older life stage will be a time of options, empowerment and activity in line with the trends that we are starting to see now. The empowerment of seniors is well illustrated by this news item downloaded from a US ‘quirky news’ website: An elderly lady did her shopping and, upon returning


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to her car, found four males in the act of leaving with her car. She dropped her shopping bags and drew her handgun, proceeding to scream at them at the top of her voice, ‘I have a gun and I know how to use it! Get out of the car, scumbags!’ The four men didn’t wait for a second invitation but got out and ran like mad, whereupon the lady, somewhat shaken, proceeded to load her shopping bags into the back of the car and get into the driver’s seat. She was so shaken that she could not get her key into the ignition. She tried and tried, and then it dawned on her why. A few minutes later she found her own car parked four or five spaces farther down. She loaded her bags into her car and drove to the police station to report her debacle. The sergeant to whom she told the story nearly tore himself in two with laughter and pointed to the other end of the counter, where four pale males were reporting a car-jacking by a mad elderly woman described as white, less than 5’ tall, wearing glasses, with curly white hair and carrying a large handgun! Table 10.1

Population statistics 1950–2050

Population (millions)

65–75

% of population

Life expectancy at 65

1950

7.9

449 770

5.8%

77

2010

22.4

1.6 m

7.6%

85

2050

40

4.1 m

10.6%

90

Chee Chee, L (2007) ‘Life in 2050: older, wealthier, hotter’, The Age, , accessed 12 May 2010; Australian Institute of Health and Welfare (1999) International Health – How Australia Compares, , accessed 12 May 2010.

A final word

A FINAL WORD

Whether our primary purpose is to parent and train, educate and engage, lead and manage or market and sell, the common factor is effective communication. This is true whether we are connecting with the Feds, Builders or Boomers, Generations X, Y or Z, or even Generation Alpha. The starting point is an understanding of their times and culture. We will have to study the audience and not just the subject. We will have to enhance our efforts to not just transmit our message but to translate it into the context of the target generation. When communicating across generation gaps an unresponsive audience haven’t necessarily rejected the substance of the message – just the style of its communication. A basic pedagogical tenet is that good communication requires the factors of show and tell. This old kindergarten activity will Table 10.2

Snapshot of the world today until 2030

Today

2020

2030

World

6.7 billion

7.6 b

8.3 b

Largest population

China

China

India

Australia

22.4 million

27 m

31 m

Europe

728 m

715 m

653 m

Europe – as percentage of world population

11% (25% a century ago)

9%

7%

New Zealand

4.3 million

4.6 m

4.8 m

McCrindle Research figures

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be increasingly applicable across all communication forums in this interactive and visual world. As we learned in kindergarten, it isn’t enough to just tell about an item – you have to show it. Similarly, one can’t just show it – without explaining it. Visual and verbal are both required in a multimodal, prove-it, walk-the-talk culture. In keeping with this principle, perhaps the final word can be delivered by way of a story. As a student of the generations and having read through this research-based analysis of the current and future global generations, you no doubt have a thorough knowledge of these cohorts. However, the goal is not knowledge alone – but application. Our hope is that our insights assist you in delivering practical strategies so that you can better engage with the disparate generations – and not end up like Albert Einstein’s chauffeur. Apparently the great physicist Einstein had a chauffeur who would drive him from place to place. At one point Einstein was on the university lecture circuit delivering speeches at different campuses and the word is that for a while he was delivering the same speech (obviously an adherent to the practice that it’s easier to find a new audience than a new speech!) This was fine except that the unfortunate chauffeur would drive Einstein to each venue, sit up the back of the room until the speech ended and drive him to his next engagement. As they were driving along the chauffeur commented that it was an excellent speech but getting quite familiar to him now. ‘In fact,’ said the chauffeur, ‘if you were sick and couldn’t deliver it, I believe I could do quite a good job.’ ‘Excellent idea,’ retorted Einstein, always up for something creative. ‘Why don’t we swap roles at this next campus and you can deliver the speech.’

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So upon arrival, Einstein put on the chauffeur’s cap and jacket and sat up the back of the theatre. Meanwhile, the chauffeur put his glasses on the end of his nose and looking very professorial strode up to the lectern and delivered Einstein’s speech. Indeed, he knew the speech so well he delivered it confidently and everyone thought he was the real deal. There was one slight problem, however. He was so succinct in his delivery that he completed the speech in a shorter time than was planned, so at the conclusion the moderator simply asked the audience if there was a question for the great professor. At this point the chauffeur started to sweat, having not planned on a question time, and wondered how he would get through it. A gentleman in the front row raised his hand and asked a very complex question on the theory of relativity to which, of course, the imposter had no answer. However, he thought quickly and looking at the questioner he said: ‘Sir, that is a very simple question – in fact it is so basic that I’m going to let my chauffeur at the back of the room answer it!’ It is one thing to know a few terms and facts, and quite another to have a knowledge which leads to practical strategies. It is our hope that for you this information leads to application. We wish you all the best as you observe and engage with all of these 21st-century generations.

NOTES

Introduction 1 Christensen (September 2003) Why hard-nosed executives should care about management theory, CM & Raynor, p. 73. Chapter 1 1 (2010) , accessed 25 April 2010. 2 McCrindle Research figures (2011). 3 Australian Bureau of Statistics (2010) Marriages and Divorces, Australia, 2010, cat. no. 3310.0, ABS, Canberra. 4 McCrindle Research figures. 5 McCrindle Research (2008) From Builders and Boomers to Xers and Y’s, , accessed 24 November 2010. 6 Ibid. 7 McCrindle Research (2010) Seriously cool, , accessed 30 April 2010. 8 Mackay, H. (1997) Generations, Pan Macmillan, Sydney. 9 Australian Bureau of Statistics (2006) 2006 Census Quickstats: Australia, , accessed 20th June, 2008. Australian Institute of Health and Welfare (2001), , accessed 3 November 2008. 10 McCrindle Research (2010) New generations at work, , accessed 23 April 2010. 11 Ibid. 12 Australian Bureau of Statistics (1997a) Australian demographic trends 1997, cat. no. 3102.0, ABS, Canberra. 13 McCrindle Research, New generations. 14 McCrindle Research figures. 15 Australian Government (2006), , accessed 1 July 2010. 16 Leigh, A. (2006), Born on the first of July, , accessed 12 July 2010. 17 McCrindle Research figures. 18 Ibid.

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