Traditional economies are failing successful millennials

The research by UBS reveals new global powers are now providing more confidence to the next generation than traditional economies.

economiesThe millennial generation in new and emerging economies are now more confident in achieving their wealth aspirations than those from traditional and established markets.

A new global study by UBS and published on its UNLIMITED platform highlights a global power shift among the generation of top-earning 18-34 years-olds.

Those in China, India and Mexico are more confident about achieving their wealth aspirations than those from UK, US, Germany and Singapore. UNLIMITED is a content partnership powered by UBS with the aim of deepening and amplifying public understanding of what it means to be wealthy in our changing world.

Hindered by political and economic instability – compounded by events including the financial crash and Brexit vote – millennials in established economies are also now more risk averse and less entrepreneurial than those in new booming economies. Whereas a staggering 99% and 98% of those questioned in India and China respectively anticipated starting their own business, only 59% in Germany and 63% in the UK thought they would.

Furthermore, the most successful millennials in established territories feel their progress is stalling compared to their parents’ generation, and the likelihood of being better off than their parents will actually diminish throughout their lifespan. As few as 37% of those questioned in Germany, and 40% in the UK, thought they would be better off than their parents at age 65.

UBS released the full findings of its study at an exclusive event in Abu Dhabi on Friday 25 November that explored these changing attitudes towards wealth. Guests enjoyed powerful insights on the topic from Professor Stephen Hawking, former F1 driver turned presenter David Coulthard, social entrepreneur Lily Cole and VP of Innovation at Google X, Mo Gawdat.

Commenting on the changing global dynamics, Professor Stephen Hawking said: “Now more than at any time in our history, our species needs to work together. We need to break down, not build up barriers within and between nations. If we are to stand a chance of doing that, the world’s leaders need to acknowledge that they have failed and are failing the many. With not only jobs but entire industries disappearing, we must help people to retrain for a new world and support them financially while they do so.

If communities and economies cannot cope with current levels of migration, we must do more to encourage global development. We need to find new ways for young people across the globe to feel optimistic about the future. The whole world has a part to play if our planet is to thrive in the long term.”

While the study highlights this power shift in confidence between old and new markets, it also underlines a global consensus among millennials about general wealth aspirations. The report showed that almost 9 in 10 people surveyed stated they consider wealth to be about something other than ‘being rich in possessions or cash.’ Instead, a life full of vibrant, exciting experiences makes them feel richer.

The report highlights the vast majority of the successful younger generation are globalized citizens, who do not see geographical borders as boundaries to their ambitions (72% would be willing to move abroad to pursue their goals); strive for a flexible future (80% consider themselves likely to start their own business); and who largely reject traditional ways of working (70% do not want a permanent contract with an employer).

The study concludes that businesses and economies need to address a range of issues in order to take advantage of this diverse and vibrant workforce of the future.

Commenting on the report, Paul Raphael, Head of Europe and Emerging Markets at UBS Wealth Management said: “It is clear from this research that the next generation has a radically different mindset when it comes to work, wealth and success. While in emerging markets, versatility and confidence are
soaring, traditional economies aren’t moving fast enough to respond to the changing demands of the young generation. These millennials represent the industry’s future clients and if we are to continue helping the world’s entrepreneurs and innovators succeed, we need to think differentl
y.” The study forms part of UBS’s on-going exploration of the changing attitudes to wealth, and investigated the views of more than 2000 top-earning millennials from US, UK, China, India, Germany, Singapore, Mexico, South Africa, UAE and Russia.

Key findings from the report include:

1. There are much higher levels of confidence about achieving the financial goals in new economies, while established economies are losing momentum. Of those questioned, 77% were confident in India and 72% in both China and Mexico, compared to just 64% in the US, 62% in the UK, 59% in Germany and as low as 44% in Singapore.

2. Successful millennials from the old world superpowers are the least likely to anticipate starting their own business – 59% in Germany and 63% in the UK, compared to an extraordinary 99% in India and 98% in China.

3. Only 37% in Germany and 40% in the UK think they will be better off than their parents at age 65. That is compared to a much more confident 74% in both China and India and 71% in Mexico.

4. Despite the digital sector boom in the US and UK, it is the entrepreneurial millennials in new economies, such as Mexico and South Africa, who most see their tech skills as a positive influence on their financial success and security: 62% in South Africa and 55% in Mexico agreed they did, compared to only 39% in the US and 33% in the UK.

5. Only 51% of millennials in the UK say the most desirable working conditions are to have a permanent contract with an employer, and that figure drops to 11% in China.

6. Despite the apparent lack of opportunities in terms of facilitating a new, modern way of working, traditional economies remain the most popular destinations for millennials to try to seek out new opportunities, with the top three city names as London, New York and Dubai.

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