What's Happening?
Gen Z consumers are planning to cut back on holiday gift-giving this year, with a reported average reduction of 23% in spending. This shift is attributed to rising living costs and economic pressures, as highlighted in the PwC 2025 Holiday Outlook. The report indicates that Gen Z, aged 13 to 28, is experiencing a significant change in spending habits compared to the previous year, where they planned to increase holiday spending by 37%. Factors such as job market challenges and a preference for experiences over material goods are influencing this trend. Many Gen Z individuals are prioritizing spending on experiences like concerts and vacations, despite inflationary impacts.
Why It's Important?
The reduction in holiday spending by Gen Z reflects broader economic challenges facing young consumers in the U.S. Rising costs of living and job market instability are forcing this demographic to reassess their financial priorities. This trend could have implications for retailers and the economy, as Gen Z's spending power is significant. Retailers may need to adjust their strategies to cater to the changing preferences of younger consumers, who are increasingly valuing experiences over physical goods. The shift also highlights the economic pressures on younger generations, which could influence future consumer behavior and economic trends.
