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WHERE KNOWLEDGE IS POWER
Phil Ruthven, Chairman
2006 ConferenceMooney Valley Race Club
June 19, 2006
Future Trends And The 25-45 Age GroupThe Generation Xers
From a future of splendid and lonely isolationto the new communities and groups of the future
TopicsTopics
1.1. Our Changing SocietyOur Changing Society
2.2. Generations Generations
3.3. LifestylesLifestyles
4.4. Incomes, Spending And WealthIncomes, Spending And Wealth
5.5. Future CommunitiesFuture Communities
1.1.OurOur Changing Changing
Society Society
Our Changing SocietyOur Changing Society
�� Living and working longerLiving and working longer�� More generations coMore generations co --existingexisting�� Slowly rising divorce rateSlowly rising divorce rate�� Changing household structuresChanging household structures�� Smaller householdsSmaller households�� Fast rising incomes & wealthFast rising incomes & wealth�� Changing ethnic mix Changing ethnic mix (Eurasian)(Eurasian)
�� Living elsewhereLiving elsewhere�� Living differentlyLiving differently�� Home leasing on the riseHome leasing on the rise�� New tribalismNew tribalism�� Spending differentlySpending differently�� Outsourcing tasks and choresOutsourcing tasks and chores
�� Rise of virtual shoppingRise of virtual shopping�� Living with leisureLiving with leisure�� New entertainment & sportsNew entertainment & sports�� Increasing knowledge Increasing knowledge �� Increasing financial literacyIncreasing financial literacy�� Living with IC&T Living with IC&T �� Electronic “guardian angels”Electronic “guardian angels”�� Working differentlyWorking differently�� New industries/ occupationsNew industries/ occupations�� Changing spiritualityChanging spirituality�� Outlawing discrimination Outlawing discrimination �� Changing politics Changing politics (ideologies)(ideologies)
�� Ecological sensitivityEcological sensitivity
Living Longer And Working LongerLife Expectancy And The Retirement Age of Male Australians
Source: ABS, Australian Historical Statistics, IBISWorld
0
10
20
30
40
50
60
70
80
90
100
110
120
18
00
18
10
18
20
18
30
18
40
18
50
18
60
18
70
18
80
18
90
19
00
19
10
19
20
19
30
19
40
19
50
19
60
19
70
19
80
19
90
20
00
20
10
20
20
20
30
20
40
20
50
20
60
20
70
20
80
20
90
21
00
Rising Formal Education
Rising Retirement Age
Who would want to be retired for 30+ yearsin 2100; and could the nation afford it?
Female life expectancy
Australia’s Age Distribution, Australia’s Age Distribution, 18661866--20422042
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%18
66
1886
1906
1921
1933
1947
1961
1981
2001
2021
2042
Source: ABS
22 43
65+
60-6455-59
45-54
35-44
25-34
20-2415-1910-145-90-4
Workforce, by Age GroupWorkforce, by Age Group% of Total Basis% of Total Basis
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%19
11
1921
1933
1947
1954
1966
1976
1986
2001
2011
2021
2041
65+
60-64
55-59
45-54
35-44
25-34
20-24
15-19
Under15
Source: ABS and IBISWorld
31 42
So what is old?So what is old?
�� At 65 years of age:At 65 years of age:�� in 1800, you were dead 27 years ago.in 1800, you were dead 27 years ago.�� in 1900, you were dead 12 years ago;in 1900, you were dead 12 years ago;�� in 2000, you will have 12in 2000, you will have 12 --15 years to go;15 years to go;�� in 2100, you may be halfin 2100, you may be half --way through your lifeway through your life !!
�� We need to be very careful about what an “ageing We need to be very careful about what an “ageing society” or the “greying of Australia’” really mean s:society” or the “greying of Australia’” really mean s:�� we cannot assumewe cannot assume all “the oldies” are in retirement villages or all “the oldies” are in retirement villages or
nursing homes nursing homes (very few are);(very few are);�� we could assumewe could assume many are still working many are still working (albeit part(albeit part--time)time)
and most are probably fit and healthy.and most are probably fit and healthy.
�� We need to keep raising the age definition of “old”We need to keep raising the age definition of “old”
0%
1%
2%
3%
4%19
00
1910
1920
1930
1940
1950
1960
1970
1980
1990
2000
2010
2020
2030
2040
2050
2060
Marriage Rate(Newly marrieds as a % of total population)
Marriage & Divorce Rate
Divorce Rate(Newly divorced as a % of
married persons in the population)
Australian Housing DensityAustralian Housing DensityNumber of occupied dwellings & household densityNumber of occupied dwellings & household density
0
2000
4000
6000
8000
10000
120001
90
11
91
11
92
11
93
11
93
31
94
11
94
71
95
11
95
41
96
11
96
61
97
11
97
61
98
11
98
61
99
11
99
62
00
12
00
62
01
12
01
62
02
1
Occ
up
ied
D
we
llin
gs
(
'00
0s)
0
1
2
3
4
5
6
Ave
rag
e
De
nsi
ty (
nu
mb
er/
ho
use
ho
ld)
Density
Dwellings
Composition of Households in AustraliaComposition of Households in AustraliaBy household size, census years 1921By household size, census years 1921--1996 and forecast to 20411996 and forecast to 2041
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%1
92
1
19
33
19
47
19
54
19
61
19
66
19
71
19
76
19
81
19
86
19
91
19
96
20
01
20
11
20
21
20
41
1
2
3
4
5
6+
Persons perhousehold
Becoming more isolated?Becoming more isolated?
Not necessarily, due to the Internet, Not necessarily, due to the Internet, mobiles, and outmobiles, and out --ofof --home diversions.home diversions.
Communities are becoming less Communities are becoming less neighbourhoodneighbourhood oriented with manyoriented with manytribal relationships spread across vast tribal relationships spread across vast distances, some being virtual distances, some being virtual communities communities
My Own Tribes, For ExampleMy Own Tribes, For Example�� Immediate RelativesImmediate Relatives
�� MotherMother NSW Central CoastNSW Central Coast�� SiblingsSiblings NSW Central Coast (2), Sydney (2)NSW Central Coast (2), Sydney (2)�� Sons & spouses Sons & spouses Melbourne (1), Los Angeles (2)Melbourne (1), Los Angeles (2)�� Grandchildren Grandchildren Melbourne (1) USA (4)Melbourne (1) USA (4)�� Partner Partner (12 years)(12 years) Sydney Sydney
�� Close MatesClose Mates�� Adelaide, Melbourne and SydneyAdelaide, Melbourne and Sydney
�� NeighbourhoodNeighbourhood�� My apartment block, My apartment block, favouritefavourite shops, restaurants, parks in E. shops, restaurants, parks in E. MelbMelb..
�� ClubsClubs�� In Melbourne(1) and Sydney (1)In Melbourne(1) and Sydney (1)
�� WorkWork�� Australia, USA. Indonesia, ChinaAustralia, USA. Indonesia, China
�� Charities & Charities & NFPsNFPs�� Melbourne (3)Melbourne (3)
2.2.GenerationsGenerations And And Their DifferencesTheir Differences
Australian BirthsBy Generational Types 1850-2005
0
50000
100000
150000
200000
250000
300000
350000
4000001
85
0
18
58
18
66
18
74
18
82
18
90
18
98
19
06
19
14
19
22
19
30
19
38
19
46
19
54
19
62
19
70
19
78
19
86
19
94
20
02
20
10
20
18
20
26
20
34
20
42
20
50
Mill
enni
als
Gen
erat
ion
Xer
s
Bab
y B
oom
ers
Fed
erat
ion
Net
Gen
erat
ion
CIV
ICS
AD
AP
TIV
ES
RE
AC
TIV
ES
IDE
ALI
ST
S
AD
AP
TIV
ES
CIV
ICS
RE
AC
TIV
ES
IDE
ALI
ST
S
AD
AP
TIV
ES
IDE
ALI
ST
S
Sile
nts
Four Types of GenerationsFour Types of Generations
The wealth creators and nation building generation. The can-do generation, pragmatic and rationalist. Not a lot o f social graces.
The generally silent, obedient but more socially aw are generation. Adapt wealth-building to other social needs. Can dev elop scruples.
Source: “Generations” (Strauss & Howe) and IBISWorld
Civics/HeroesCivics/Heroes
Adaptives/ArtistsAdaptives/Artists
Idealists/ProphetsIdealists/Prophets
The social visionary and idealistic generation . Want to change the world now. Humanists and social re-engineers . Big spenders.
Reactives/NomadsReactives/Nomads
The reactive, conciliatory generation . Consolidators of change andpeace-seekers. Repair damage of idealists. Pave way for new civics.
Today’s Many Generations In 2006
Description Generation Birth Age Number Share (Type) (Year 2006) (million) (%)
Federation Civics/ 1901 – 192 82+ 0.57 2.7% “golden oldies” Heroes
Silents Adaptive/ 1925 - 1942 81 - 64 2.38 11.5% “conservatives” Artists
Baby-Boomers Idealists/ 1943 - 1960 63 - 46 4.70 22.6% “spoilt-rottens” Prophets
Generation X Reactives/ 1961 - 1981 45 - 25 6.26 30.3% “angoras” Nomads
Net Generation Civics/ 1982 - 2001 24- 5 5.55 26.7% “free-rangers” 1. HeroesMillennials Adaptives/ 2002- 2020 < 5 1.29 6.2%“conservatives” Artists
Total 36.6 20.75 100%
Note: 1. Unconstrained by time, space and distance due to th e Internet, mobile phones etc.
Generations in Generations in 20062006
14/02/06
26.7%
30.3%
20.8 million persons
Net Generation“free-rangers”
Generation Xers“angoras”
Baby Boomers“spoilt rottens”
Federation(>81)
CivicsMillennialsMillennials
(<5 years(<5 years))Silents
New Civics5-24 years
Adaptives64-81 years
Idealists46-63 years
Reactives 25-45 years
22.6%
11.5%
Most powerfulgenerations
Adaptives
6.2%
2.7%
Generations in Generations in 20162016
14/02/06
26.5%28.8%
0.7%
18.4%
23.6 million persons
Net Generation“free-rangers”Generation Xers
“angoras”
Baby Boomers“spoilt rottens”
Federation( >91)
Adaptives0-14years
Millennials
Civics15-34 years
Adaptives74-91 years
Idealists56-73 years
Reactives 35-55 years
18.3%7.4%
Most powerful generation
Silents
Changing AttitudesChanging Attitudes
�� The The Generation XersGeneration Xers , being , being reactivesreactives , are a quiet , are a quiet generation, reacting against the reform zeal of the generation, reacting against the reform zeal of the Baby BoomersBaby Boomers being being idealistsidealists . They have a . They have a balanced attitude to family and work. They are not balanced attitude to family and work. They are not overly ambitious, and largely settle for the quiet overly ambitious, and largely settle for the quiet life. life.
�� The The Net GenerationNet Generation , being , being civicscivics /heroes, are a /heroes, are a driving and goaldriving and goal --oriented generation and have a oriented generation and have a true “we” approach to life and business. They are true “we” approach to life and business. They are the best educated and savvy generation in history. the best educated and savvy generation in history. They are largely fearless.They are largely fearless.
Labourforce By GenerationsF2006 (E)
Source: ABS/IBISWorld 14/02/06
10.6 million persons
Net Generation“free-rangers”
Generation X
Baby BoomersNet Generation
Silents64-81 yrs
46-63 years18.7%
3.2%Up to 24years
29.6%
48.5%25 to 45years
“Civics”
“Adaptives”
“Idealists”
“Reactives”
Changing Political Ideologies
Socialism(the “left”)
Capitalism(the “right”)
Rationalism(the “head”)
Humanism(the “heart”)
Industrial Age to 1964
New
Age to 2040s
3.3.Incomes, SpendingIncomes, Spending
& Wealth& Wealth
Average Household IncomesAverage Household Incomes$’000$’000 19901990--20062006
0102030405060708090
100110120130140
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
Ave
rage
Inco
me
($’0
00)
Year, ended December
$101,750(F)
$794.3 billion ($96,860 per household)
H’HoldH’Hold durables 3.8% durables 3.8% Motor vehicles Motor vehicles 2.62.6%%Other 0.6%Other 0.6%
Capital Related
19.7% Non-durables
7.0% Durables
Taxes(& social contributions)
11.7%
5.1%
16.0%
Depreciation 6.6% Depreciation 6.6% Dwell./Prop 6.5%Dwell./Prop 6.5%Other Debt Int. 0.9%Other Debt Int. 0.9%Transfers 0.2%Transfers 0.2%
Australian Household ExpenditureAustralian Household Expenditure20052005
Entertainment & Gaming Hospitality
Rent(& other dwelling costs)
14.3%
FoodFood 7.3% 7.3% AlcAlc .& Tobacco.& Tobacco 2.7%2.7%ClothingClothing 2.2.55%%UtilitiesUtilities 1.3%1.3%VehVeh. Operation. Operation 3.8%3.8%Other 2.1%Other 2.1%
Education
3.5%
Other Services
Communicns. 1.9%Fares 1.6%
2.8%
Fin. & Ins. Serv. 6.9%
8.0%
Health
Note: 1 includes transfers
3.6%
Source: ABS5206/IBISWorld
2.4%
Australian Australian Household Assets & DebtHousehold Assets & DebtJune 2006 June 2006 (F)(F)
$ 5520 billion($676,500 /household)
Housing(owner-occupied)
Invest.Housing
Super. & Life
Commercial & Rural
Oth
er8.
6%Deposits 7.5%
(& currency)
SharesIncl. Sec. &
Loans
Sources: Reserve Bank Statistical Tables B20;IBISWorld estimates 15/02/06
HouseholdDebt
$ 990 billion($121,300
per household)
Assets $ 5520 billion,Net Assets $ 4530 billion .
Per H’Hold $ 555,150
Debt servicing comes from wages (mainly), rental property
returns, and interest & dividendsfrom liquids & securities
10.6%
34.1%7.5%
11.4%
20.4%
Equipment, Inventories,H’hold durables)
OtherProperty
Household Income And Wealth Distribution Share of Total By Quintile, F2006 (E)
8,016 million $801 billion $4530 billion
Source: IBISWorld 25/04/06
Household Income Wealth
1547 H’Holds $99,890 $555,150 Average
20.0%
20.0%
20.0%
20.0%
20.0%
45.1%
24.5%
16.3%
9.6%4.5% 1.0%
59.0%
21.3%
12.7%
6.0%
Among 8.02 million H’holds:
920,000 millionaires 44,000 > $ 5 million7,000 > $10 million
Richest
Well Off
Middle
Struggle
Poorest
4.4.Lifestyles Lifestyles
Lifestyles in the Industrial AgeLifestyles in the Industrial Age18651865--1964 1964
�� home ownership and the quarter acre block dream;home ownership and the quarter acre block dream;
�� dad at work, mum at home dad at work, mum at home (with 3(with 3--6 kids)6 kids);;
�� long careers for men, and the gold watch;long careers for men, and the gold watch;
�� strict rules about sex, blaspheming and other stuff ;strict rules about sex, blaspheming and other stuff ;
�� high street shopping high street shopping (grocer, butcher etc)(grocer, butcher etc);;
�� dodo --itit --yourself yourself (DIY)(DIY) everything, in and around home;everything, in and around home;
�� the corner pub the corner pub (weekdays)(weekdays), sport , sport (Saturday arvo)(Saturday arvo), and church , and church
and the midday roast and the midday roast (Sundays)(Sundays); ;
�� cinema, radio, TV cinema, radio, TV (B&W)(B&W) and cards as entertainment;and cards as entertainment;
�� holidays holidays (Christmas)(Christmas) by staying with relatives;by staying with relatives;
�� electricity, the telephone, washing machines,househ old electricity, the telephone, washing machines,househ old
gadgets, mum’s sewing room, dad’s shed and the BBQ.gadgets, mum’s sewing room, dad’s shed and the BBQ.
Lifestyles in the New AgeLifestyles in the New Age19651965--2040s 2040s
�� home ownership still dominant, but leasing on the r isehome ownership still dominant, but leasing on the r ise ;;
�� dad and mum at work, with 1dad and mum at work, with 1 --3 kids 3 kids (thank God for mobiles)(thank God for mobiles) ; ;
�� more marriages more marriages (but same average length) (but same average length) due to longer lives;due to longer lives;
�� the Internet the Internet (communications/e(communications/e--mail, information, banking, shopping);mail, information, banking, shopping);
�� sport all the time sport all the time (including TV)(including TV) and new gambling options;and new gambling options;
�� modern clubs, pubs, hotels, casinos and entertainme nt;modern clubs, pubs, hotels, casinos and entertainme nt;
�� digital colour TV digital colour TV (including pay TV)(including pay TV), , Radio Radio (FM)(FM);;
�� frequent holidays frequent holidays (esp. short breaks)(esp. short breaks) and lots of o/s travel;and lots of o/s travel;
�� mobile telephones mobile telephones (world fastest uptake)(world fastest uptake),, electronic gadgets;electronic gadgets;
�� electronic guardian angels;electronic guardian angels;
�� outsourcing of household services and chores;outsourcing of household services and chores;
�� more leisure timemore leisure time
�� new tribalism/communities, but not necessarily neig hbourhoodnew tribalism/communities, but not necessarily neig hbourhood
DoDo--ItIt --Yourself and Paid WorkYourself and Paid Work2006 (F)2006 (F)
MalesMales FemalesFemales
DIY38%
Paid Work62%
DIY62%
Paid Work38%
$50,400(average)
$33,500(average)
Source: ABS plus IBIS estimates
Note:Total hours identical,
male and female
The DIY share is fallingas we outsource more
Household Outsourcing In The New AgeHousehold Outsourcing In The New Age 11
F2006 F2006 (E)(E)
$110 billion$13,700 per Household
Source: ABS, IBISWorld
Health 7.2%
Legal 5.1%
3.4%
SexualServices
2.7%
27.8%
19.6%Tourism
Entertainment
Other
5.4%3.3%
15.1%Financial 7.1%
Meals
Child Care
HomeMaintenance
Hair
Note: 1 Spending on newservices, since 1965
Miscellaneous
2.0%1.6%
We are outsourcing more and more We are outsourcing more and more DIY household activities to create DIY household activities to create
more leisure time more leisure time –– as shown later.as shown later.
Increasing Leisure TimeHow various generations have spent, or will spend, their lifetimes
0102030405060708090
100
38 43 53 59 72 88 100
Sh
are
of
Lifetim
e (
%)
Year born
Leisure Time
Paid Work
Unpaid Work
Education
Travel to Work
Sleep
46%42%38%35%29%
25%23%
Source: IBISWorld
21.8% 19.8% 15.6% 12.4% 10.4% 9.1%
23.7%
1788 1838 1888 1938 1988 2038 2088
Life Expectancy(years)
5.5.Future Future
Communities Communities
The Individual
The Changing Environment for the Individual
The Individual,centre of his/her
universe
Theimmediate community
How much do we need to think about . . . .
The Influential Environments (4)8. Our community at large, demography, lifestyles, ethics, attitudes
9. The economic environment, suburban, local, state & national10. The resources environment, ecological and developed (infrastructure)
11. The world environment.
The Operating Environments (6)2. The labour market, what and where the jobs are
3. The marketplace for goods & services, physical & virtual shopping
4. The educational institutions, schools, TAFEs, universities
5. The leisure & recreational facilities, parks, sport facilities etc.
6. The investment opportunities, owned-businesses, passive investment
7. The local governnment, council, regional government bodies
The Immediate Environment (1)1. Our Household & Community, its changing make-up
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