Barron's Jacqueline Doherty reveals a certain lack of cultural literacy when she calls the late Kurt Cobain a patron saint for Millenials. Gen Y took no time stealing all the attention from Gen X, but they can't steal their icons. Still, Doherty's cover story on the consumer power of Millenials is worth a read. The new power generation is larger than the Boomers, and now are rapidly becoming the driving force across a lot of marketplaces. The Millennials already account for an annual $1.3 trillion of consumer spending, or 21% of the total, says Christine Barton, a partner at the Boston Consulting Group, which defines this cohort as ages 18 to 34. As the economy pulls out of an extended period of sluggish growth, helped in part by this rising generation, annual growth in consumer spending is likely to revert to its long-term average of 3.5% to 4% from about 2% now. Likewise, consumer spending on durable goods could rise sharply. The Millennial generation has already made a big mark on one industry: education. The number of students enrolled in college in the U.S. climbed by 30% from 2000 to 2011, helping to fuel a building boom on campuses across the country. But that's something many schools could regret in coming years, given the past decade's sharply declining birth rate. Owing in part to the Millennials' surge, apartment demand is strong around the country. Housing could be the next major industry to benefit from their size and maturation, but Wall Street could reap the biggest rewards. The MY ratio, which compares the size of the middle-aged population of 35-to-49-year-olds with that of the young-adult population, ages 20 to 34, explains why. Middle-aged folks have higher incomes than younger people, and a greater urgency to save for retirement. They invest their savings, which drives up stock prices. When the MY ratio is rising, meaning the older cohort outnumbers the younger, the stock market typically does well. The ratio has been falling since 2000, which has exerted a drag on stock prices. Read On the Rise here .
Filed under: global business, savings, Gen Y, generation Y, millenials, stock, retirement, baby boomers, consumer, boston consulting group, boomer, Barron's, Jacqueline Doherty