Young Western Australians are bucking the cost-of-living pressures facing their older counterparts, with Bankwest’s latest Spend Trends report showing Gen Z revelling in a life of fewer financial dependencies.
Bankwest’s Spend Trends tracks WA customer credit and debit activity to identify insights in community responses to economic conditions, with June data showing Gen Z spending at rates other generations could only dream of.
The number of customers transacting year-on-year among Millennials (-8%), Gen X (-7.4%), and Baby Boomers (-7.2%) declined significantly, but Gen Z defied that trend, with the number of those spending growing 2.5 per cent.
It was a similar story for the volume of transactions, with Gen Z (+6%) the only generation to increase year-on-year.
Gen Zs’ freer spending habits were not just confined to the number of those transacting or the volume of transactions, but young Western Australians were also spending more on average than older generations.
The average value of Gen Z’s transactions year-on-year grew by 15 per cent, which was double that of any other generation, indicating the value increase was not purely the result of cost-of-living pressures.
Highlighting the difference in financial pressures being felt by the generations was the fact that of the 25 sectors tracked in the Spend Trends data, only 10 experienced declines year-on-year for the number of Gen Zs spending.
That was compared to 23 sectors declining for Millennials and Gen Xs, and 24 declining for Baby Boomers.
The travel industry was a beneficiary of Gen Z’s cash splash, with the number of customers spending on Auto rental (+32%) and Airline (+17%) up year-on-year, with other generations either declining or stable in the sectors.
However, Gen Z was more willing to spend regardless of whether a sector was discretionary or essential, with increases in customers spending also recorded at Pharmacies (+14%) and Food stores/Warehouses (+7%).
That contrasted with Millennials (-4%, -5%, respectively), Gen X (-4%, -4%), and Baby Boomers (-3%, -5%), who all declined in the number of customers spending at Pharmacies and Food stores/Warehouses.
Bankwest General Manager Products and Digital Services Peter Bouhlas said: “It’s clear the current economic environment is proving challenging for most Western Australians, particularly those with a mortgage.
"However, this data shows the economic environment that is putting so much pressure on older generations is having very little effect on the spending behaviours of younger Western Australians.
"Western Australians are used to the term ‘two-speed economy’ referring to the higher wages paid to mining workers, but it could easily be used in reference to the pressures currently being felt by Gen Z compared to others.
"Gen Z is the generation most likely to comprise the casualised workforce and is less likely to have the significant financial responsibilities of their older counterparts at this stage in their lives.
"We know from the low unemployment rate that businesses are crying out for workers, so that means there is a generation of young Western Australians in high demand for work, with fewer spending obligations.
"The experience of Gen Z at this time is unfortunately not that of the majority of Western Australians, and we encourage any customers concerned about their circumstances to reach out so we can support their unique position."
