One Thing Boomers Are Right About Millennials

The Generation Wars always seem to boil down to this one topic — and it turns out Boomers might just be right.

In the struggle between the different generations of Australia, the commentary on both sides of the debate sometimes sinks into hyperbole and painfully exaggerated cliché.

For those who participate in the intergenerational conflictmany would have heard all about how smashed avocado on toast is the real culprit for the lack of affordable housing and how boomers bought their houses for about the same price as a packet of crisps and a Mars bar costs today.

Like most hotly contested civil wars, there is truth in the hyperbole on both sides of the debate, with just how much truth there is depends on the eye of the beholder.

But what does the data say about dining out spending today versus 40 years ago?

That’s what we’ll explore in this article: how spending patterns have changed, its impact on the economy, and how the composition of the economy has changed over the past four decades.

Back in the 80’s

Over the past 40 years, the makeup of the Australian economy has shifted enormously.

Where there were once factories across the country producing everything from cars to fishing reels, there are now gyms with personal trainers and barista coffee in practically every suburb of the city.

If you look at the data, it really shows.

When comparable records began in 1983, spending on takeaway, restaurants and cafes was 0.68 percent of GDP. About halfway through our data set in 2002, that figure had more than doubled to 1.4 percent of GDP.

Finally, in a lockdown affecting 2021-2022, it had risen to more than three times its original size as a share of the total economy, to reach 2.33 percent of GDP.

While this point goes to older Australians based on the data, it is a measure of the entire economy and not just indicative of the spending habits of younger Australians.

The economy has changed

In 1990, value-added manufacturing represented about $1 for every $7 generated by the country’s economy in terms of GDP (13.8 percent).

At the time, Australia wasn’t quite what you would think of as a manufacturing powerhouse comparable to Japan or Germany, but it certainly could hold its own, producing all kinds of goods for domestic consumption.

That level of self-sufficiency and production output is now a distant memory.

According to the latest comparable data from the World Bank, manufacturing now represents just 5.65 percent of GDP or about $1 for every $18 generated by the country’s economy.

Where once Australia could be considered at least on the same margin as the United States or Great Britain, some of our direct rivals in terms of production as a percentage of GDP are now countries like Botswana and Eritrea.

This has of course drastically changed the makeup of the economy, where once industry was a driver of economic growth, it has been displaced by the export of minerals in terms of GDP and the service sector for jobs.

Clichés and the economy

Indeed, as the data has shown, Australians spend a higher proportion of the country’s income on things like eating out. Older Australians are arguably right on this – there are some households that could be more careful and a bit more frugal.

However, there is an “if and but” to that particular statement and it’s a big one.

In recent decades, especially since the start of the pandemic, the economy has become increasingly dependent on consumer spending to fuel growth and create jobs.

This may be characterized by some as buying random cr*p and overspending on dining out, but for better or for worse, the economy that has been created has delivered the lowest unemployment rate in decades.

You could certainly argue that excessive consumerism is bad for the planet, but as we’ve learned over the past two years, these things can’t just be turned on or off without consequences, even if we wanted to.

Older Australians may be right about rethinking our lives to devote our money to what really matters to us, but at the same time we need to be wary of the consequences this could have if we somehow collectively follow their advice.

Tarric Brooker is a freelance journalist and social commentator | @AvidCommentator

#Boomers #Millennials

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