Three-Quarters of Chinese Consumers Plan to Maintain or Increase Spending in 2016 - Seite 2

China's "young generation" is growing quickly in both numbers and income. Those aged 18 to 30 years old will likely make up more than one-third of the urban population by 2020. Their consumption is growing at a 14% annual rate -- twice the pace of the "last generation," those older than 35. The young generation's share of total consumption is projected to increase from 45% to 53% by 2020.

These consumers, for the most part, grew up during a time of expanding wealth as China made the transition to a market-based economy. One result is that they are notably more aggressive in their spending intentions: 60% agree with the statement, "It seems like every year, there are more things I want to buy." UMC young-generation consumers are particularly freewheeling. Almost two-thirds believe, "Some products are just too important to me to scrimp on." One constraint on their intentions may be wages: many young-generation workers are employed in lower-paying retail and commercial-service sector jobs than their last-generation counterparts.

Home Values Trump Stock Market Turmoil
Recent stock market volatility has little impact on Chinese consumers' daily lives, including consumption. More than half of China's consumers see the market volatility as normal; more than 40% consider the recent volatility a correction to the stock market bubble that formed after a sustained period of strong growth. For almost half of consumers, stock market gains or losses do not affect consumption. About 70% of urban households do not invest in stocks, and those that do have both higher incomes and higher likelihood of increasing spending than those that do not.

Housing-market stability is a much more critical consideration for Chinese consumers, who continue to be optimistic about housing prices. More than 80% of urban households own their homes, and 60% of these homeowners are sitting on unrealized gains in value. Almost 60% of consumers expect home values to rise in one to two years, and one-third said that they would buy property in one to two years. Younger and more affluent consumers and those living in midtier cities are the most optimistic: almost two-thirds of young-generation, UMC, and affluent and midtier consumers expect housing prices to increase in the next one to two years.