Treasures in the Cloud: Forecasting The Economy of the Future
I remember feeling the winds of change through that windy city — evolving into romantic minimalism.
Urban renewal was blowing through, care for communities, multi-diversity, sustainability, permaculture, creative startups, urban gardening, fair trade cooperatives, caring for refugees, being a voice for the voiceless, spaces and venues for starving artists and performers, and beautifying the inner city — from downtown to Belmont, Wicker Park, and even the North side.
And I felt a profound reality sink in — my cohorts were hardly pre-occupied with growing a 401K and owning a big home in the suburbs someday, or even just owning a car…they were dreamers…and so was I. This would essentially mean an economic change.
And then the economy started slowing, physically, for unrelated reasons. This would likely be the first generation in American history to have less than their parents. The change of values, lack of striving for purely financial goals, and a sluggish economy, were going to be enough to settle for less, materially at least.
It seemed like an almost a communal decision that having less was actually best. Less land, less square footage inside, less cars per person, less privacy, less ownership, less name-brand items and less savings than our parents. In exchange for…
I believe it is a world-wide trend. Having lived in Asia since 2008 I can personally attest that:
— Tel Aviv is the Detroit of e-bikers. The start-up nation has a shift of values taking place, much to the chagrin of the older Zionists.
— Indian millennials are extremely educated and are making leaps and bounds out of poverty. They are shifting their spending habits to center around travel and becoming entrepreneurs — unleashing 65% of their young population into the workforce within the next 20 years.
— In Japan, retailers are concerned with the young thrifty Japanese minimalists that don’t value buying things, especially exclusive and luxury items, a sharp change from their predecessors that helped to create an economic boom.
And so perhaps it is a global reality that economists and those wanting to market to the next generation need to face:
How do you shift your definition of wealth for a generation that is happy with less?
How do you spur an economy that is in recession if the rising work force as a whole has different values than those before them, and is more hesitant to spend money? (Or at least, spends money of different things).
Minimalism has been the most important recent development in interior design according to Martha Stewart. She says, “Nobody from [age] 40 down — nobody wants a lot of stuff.” She continued talking about the lack of interest in knick-knacks and elegant carved chairs saying, “I don’t even know if they know what Chippendale is.” (a)
A recent Forbes Magazine article interviewing influential entrepreneurial millennials found that 79% choose to live in an urban environment, and therefore 30% of them saw no need in owning a car. Eighty percent of them are actively engaged in volunteering and giving back to the community. Fifty percent listed one of their primary goals was to “change the world for the better”. So it is not a lack of initiative, but a change of priorities. (b)
Forbes quoting retail expert Robin Lewis explained that the negative impact of minimalism for the economy as a whole was that, “This is a generation that is bigger than the boomers in population, but their wallets are smaller, and they are more into the style of life than the stuff of life. This is a big threat to retail. They’re not into a lot of shopping.” (c )
I am personally a millennial that has chosen a more minimalist lifestyle and has spent 10 years in the non-profit and development world. I have traveled a lot, and own little. I have given away much. Like my counterparts, I believe relationships and connections are primary for true lasting societal change. However, when I think of us as a whole spending less on stuff, and choosing stoicism and altruism, those resulting spending patterns are not going to be the key to economic growth. There needs to be another plan than banking on Wal-Mart and Dollar Tree to fill the void for a truly healthy job and production market.
In thinking of how this relates to the current recession, the desperation many feel in job searching, and the needs of young families throughout the globe, I believe the key to economic reform and growth is a re-definition of wealth, and a re-centering of the economy on both the timeless values of owning a home, leaving a legacy, and not having debt; as well as new idealistic values of shared economy, fair trade, and communal good will through perhaps paying higher local taxes, or HOA fees.
The following insights can be helpful for those engaging in startups, marketing, development and formation of international economic policies like we see in China’s One Belt One Road, as well as the global sustainability movement. These policies, though hoping for economic gains, are built on connectivity, whether it be building highways of concrete from Korea to Jerusalem, or information highways through Kansas City and Pakistan, the power of connection is the name of the game. Redefining what matters to us is essential to keep moving forward.
Here is a redefinition of wealth for a generation that is happy with less:
Treasures in Heaven. The Cloud is the place where my most treasured possessions are kept. For me it’s my notes, reports and article library from university, as well as various books that I have started writing and never finished. For my husband, it’s years of photos and B-roll (as he is a videographer by trade). For both of us, our life’s soundtrack is probably the second most valuable possession also kept in the cloud — whether it be the playlist from our wedding party, the Dhaler Mendhi CD we bought in Pahar Ganj, or my friend’s garage band CD from high scool. At the end of the day, when it comes to “material things” the most important ones are all in the cloud. Like Jesus said, store your treasures in Heaven where, moth and dust cannot destroy. For us, paying rent for a cloud is of primary importance, and there is no other choice.
The Shared Economy. The shared economy has turned traditional hotels, motels, and taxi-industries upside down in the matter of a few years. Also when we buy media we want to share it in the extended family (Apple knows that and is keeping up). When we buy stuff, we want to turn around and sell it again on Ebay or Amazon, or send it to friends in need. Good bye forever to telephone books. Google, using the Hacker Ethos, is constantly developing free information, free applications, and the free exchange of ideas — and they are somehow winning economically on the basis of freedom.
The Caring Economy. Eighty percent of millennials give at the cash registers. Many will choose a slightly more expensive item that is ethical over a cheaper non-ethical item. Many go out of their way to buy gifts that are fair-trade or have a community return on their even small investment. As a generation they are voting with their dollars for what matters most to them. While you won’t find many who are completely theoretically pure to the fair trade or ethical clothing ideal, when it is convenient the right choice is easy.
The Wealth of Experience. Millennials are more willing to spend money on an experience versus an item. While it can be criticized as whims that come and go with a fleeting moment, it can also be valued as intangible wealth. Wealth that you don’t have to find a place for in your small apartment or have a big garage for, wealth that is enriched by the people you share it with, wealth that you don’t have to worry about the return on the investment because you are happy for the memories. It’s more about people, education, and personal development than material ownership.
Health and Wealth. Millennials are very health conscious and are willing to pay more for exercise (or, “leisurecise”), organic foods, and health items (like soaps, or essential oils). They are also the most likely to get counseling. Part of these choices are tied to a core belief that well-being is important and tied to daily lifestyle choices, the conscious feeling of stress that they don’t believe is healthy and hope to overcome, as well as an underlying distrust for the modern food industry. This may also be tied to millennials having more allergies than the generations before them.
The Wealth of Knowledge. Past generations have received their value system primarily from their family and local culture. Millennials however have been media consumers their whole lives, have international neighbors, and are the most educated generation in history. As a result they put a much higher value of further education, certification, books, and information sources than previous generations that placed more clout on those around them. Travel, as in the days of Mark Twain, is seen as the “purest education.”
The Value of Connection. In a mobile and unstable world, connectivity seems like the only constant. As a result, people will do whatever it takes to maintain that connectivity, whether it means getting a phone that does everything you want it to do (especially take good photos), a big data plan so you can send the grandparents pictures of their grandkids, a good wi-fi connection so you can stream videos, go out to eat because your friends are, and travel to see your friends that moved across the country or the world before you lose touch. Any cost for the sake of greater connection seems worth it. This isn’t necessarily a higher value on technology or nice things, but a higher value of what those things can do for you — preserve your memories, make memories, and bring about greater connection and connectivity.
Surprise! The Importance of a Home With Room for Mom and Dad. As millennials finally get married and become parents, they are moving out and looking to buy homes. The most popular homes that we found while house hunting for fun are those that have un-attached “in-law suites” or “granny flats”, ironically, homes with room for mom and dad, not for 3 cars.