Millennials Making More Happen With Less [Chart]
Recent survey sheds light on millennial spending habits
The Chart of the Week is a weekly Visual Capitalist feature on Fridays.
Despite the Western world’s general shift towards healthier eating, it may surprise you to learn that McDonald’s shares traded at all-time highs just days ago.
How is this possible?
Part of the reason is that although millennials will tell you otherwise, the name of the game for courting many millennials is still convenience. Price points at a restaurant such as McDonald’s still have wide appeal to a cash-strapped generation.
Based on a recent survey by TD Bank, the convenience trend is still on track. Here’s what we learned on millennial spending habits from the results.
Getting More out of Less
A major finding of the survey was that although millennials “go out” twice as often as Generation X and three times as often as Baby Boomers, they spend less per month on purchases than their older cohorts.
Millennials made more purchases on retail goods and dining than other generations, but spent less money overall. In fact, the only category where Millennials spent more than Gen X and Boomers is on coffee and fast food – demonstrating a need for food on the run and frequent doses of caffeine.
The average millennial went out 13 times each month, spending $103 for an average of $7.90 per transaction. This compares with nine trips with $122 of spend ($17 per transaction) for the average consumer.
The same was the case for grabbing “coffee and food on-the-go”, where millennials said that they went on more trips than the average consumer. Millennials also spent a higher total than others, spending $80 over 11 trips (compared with $67 over eight for the average consumer).
Experiences vs. Material Items
While the survey paints a picture of millennial thriftiness, we also think that there is another lens that can be used to shed light on the results. In particular, we believe this shows that the value that millennials place on having experiences.
To many millennials, “going out” is as much about the experience as the material food itself. Whether it is connecting with old friends at a new thin-crust pizzeria or trying a locally-roasted single-origin coffee with a significant other, it’s often more about sharing an experience with good company. It doesn’t have to be a fancy dinner or involve a $100 bottle of wine purchase to count as quality time.
This could be a partial reason behind a higher frequency of trips out, even though less money gets spent overall.
Cash vs. Credit
A final point of interest from the survey lies in the difference in how millennials make discretionary purchases.
On average, Americans spend $4,700 per year with a credit card, and $2,400 with cash, a debit card and checks for discretionary purchases. Millennials tend to use cash, a debit card and checks more often ($5,200) and charge 22% less ($3,300) than the average consumer
Millennials, many of whom grew up during the Financial Crisis, are more averse to debt. This is corroborated by the results of a different survey showing that seven out of 10 millennials say they would prefer to use a debit card, rather than a credit card, for their purchases.
It’s also an attitude that we’ve covered in a previous chart of the week, where we showed that only 37% of millennials were confident in managing their credit, while 70% of millennials hold their savings and investments in cash.
War and Peace: How Violence is Disrupting the Global Economy
This graphic estimates the direct and indirect costs associated with violence, and explores how they are negatively impacting the global economy.
War and Peace: How Violence is Disrupting the Global Economy
Although you may not see it, millions of lives are disrupted by violence everyday.
War, homicide, terrorism, suicide, and sexual assault can be found across the world in various degrees. While certain types of violence can incur costs that result in personal traumas, violence can also create significant economic disruptions.
In today’s Chart of the Week, we visualize data estimates from the Global Peace Index 2019 on the global cost of violence, and its geographical spread.
How is Violence Linked to the Economy?
The Global Peace Index calculates the total cost of violence using purchasing power parity (PPP) by considering three factors:
- Direct costs: Immediate consequences to the victims, perpetrators and the government
- Indirect costs: Delayed economic losses following the violent event, including the after-effects of trauma experienced by the victim
- Multiplier effect: Calculates the additional economic activity that would have accrued if the direct costs of violence had been avoided.
Between 2012-2017, the cost of violence increased by 11% to $14.6 trillion—mainly due to rising violence in Syria, Libya, Yemen, and other parts of the Middle East and North Africa.
In 2018, the total cost of violence decreased for the first time in six years to $14.1 trillion. That’s the equivalent of 11.2% of global GDP (PPP), or $1,853 for every person.
In this one year, the $475 billion saved from decreased violence costs was largely due to lower levels of armed conflict in Syria, Ukraine, and Colombia.
The Top 10 Worst Affected Countries
It comes as no surprise that countries affected by conflict incur the greatest costs due to a higher than average death toll, and sizable military expenditures.
Here are the countries with the highest cost of violence according to the report:
|Rank||Country||Cost of violence (% of GDP)|
|#3||🇨🇫 Central African Republic||42%|
|#4||🇰🇵 North Korea||34%|
|#10||🇸🇻 El Salvador||22%|
Since 2017, Venezuela has climbed the ranking and now sits in the top 10, due to continuing political repression and a spiraling economy as a result of hyperinflation.
The Global Composition of Violence
Government spending on military comprises 40% of the global total, or $5.7 trillion in constant purchasing power parity (PPP).
|Type of economic impact||Share of total|
|Internal security expenditure||31.7%|
|Private security expenditure||5.8%|
Naturally, the types of violence costs vary by region, and the most noticeable difference is in military expenditure. It represents 59% of Middle East and North Africa’s violence costs—but only 8% for Central America and the Caribbean.
Interestingly, the Middle East and North Africa boast the lowest levels of violent crime, homicide, and suicide, representing only 4% of the total, compared to South America’s 45%.
Keeping the Peace
Despite today’s chart painting a picture of the world as a dangerous place, it is worth noting that there are two sides to this story.
Of the 163 countries ranked in the index, 86 countries improved their peace score in the last year, with Iceland retaining its number one position for over a decade. In fact, the country has not had any gun murders since the Global Peace Index began in 2007.
Is the recent drop in costs of violence a sign that we are moving towards a more peaceful planet, or just a blip on the radar?
Ranked: The 20 Easiest Countries for Doing Business
Entrepreneurship is challenging at the best of times. Here are the countries where at least starting a new business is easy to do.
Ranked: The 20 Easiest Countries for Doing Business
Contrary to popular belief, the hardest part about running a business may not be finding customers, it’s getting one started.
Depending on the public policies and application processes of your country, you might struggle or succeed in opening and operating a business.
If you live in New Zealand, for example, you can get a new enterprise up and running in half a day. If you live in Luxembourg or Argentina, however, it’s a different story─with the process sometimes taking over a year.
Today’s chart uses data from the World Bank’s annual Doing Business 2020 report, which delves into the ease of doing business in countries around the world.
Measuring the Ease of Doing Business
Now in its 17th year, the Doing Business (DB) report measures how easy it is for someone to start and run a company in an economy, using 12 key factors throughout a business lifecycle:
- Starting a business
- Employing workers
- Dealing with construction permits
- Getting electricity
- Registering property
- Getting credit
- Protecting minority investors
- Paying taxes
- Trading across borders
- Contracting with the government
- Enforcing contracts
- Resolving insolvency
Of the 190 countries reviewed last year, only 115 made it easier for entrepreneurs to do business.
Note to readers: this year’s DB score did not factor in Employing Workers or Contracting with the Government when ranking economies.
Top 20 Easiest Countries to Run a Business
|#1||🇳🇿 New Zealand||86.8|
|#3||🇭🇰 Hong Kong||85.3|
|#5||🇰🇷 South Korea||84|
|#6||🇺🇸 United States||84|
|#8||🇬🇧 United Kingdom||83.5|
|#16||🇦🇪 United Arab Emirates||80.9|
|#17||🇲🇰 North Macedonia||80.7|
In the top spot for the fourth year in a row, New Zealand only requires half a day to start a business. Singapore also stands out for having the shortest timeframe when it comes to paying business taxes and enforcing business contracts.
Only two African nations─Rwanda and Mauritius─are listed in the top 50 countries, with Mauritius being the only one to crack the top 20 list.
Latin American economies are noticeably missing from the rankings, as many countries in this region are fraught with bureaucracy and prolonged processes.
Most Improved Scores
Several developed and developing economies made significant strides in 2019 to implement reforms that opened doors for new business owners.
The Doing Business 2020 report shows that the cost of starting a business has fallen over time, particularly in developing economies.
Top 10 Most Improved Economies, 2018-2019
Saudi Arabia made the greatest improvement overall, adding 7.7 points to its score.
Bahrain also made improvements over the most number of factors (9). While Jordan showed improvement in the fewest factors (3), it showed the second highest jump in DB Score.
Gains Among Low-Income Countries
The DB 2020 study also shows that developing economies are making progress: it’s now cheaper than ever before to run a business in developing economies.
However, a significant disparity still remains when we consider the difference in business costs between high-income and low-income economies.
An entrepreneur starting a company in a low-income economy will spend about 50% of per capita income (PCI) to launch a venture, whereas an entrepreneur in a high-income economy spends only 4% PCI to accomplish the same task.
Put another way, entrepreneurs located in the bottom 50 economies spend an average six times more to open a new company as those in a high-income economy.
Entrepreneurship and Economic Growth
Generally, more entrepreneurs will enter a market where they can easily conduct business─adding more value to local economies.
While the rankings clearly illustrate the link between ease of doing business and economic growth, there are still significant barriers in place that not only deter entrepreneurship but also inhibit a relatively simple strategy for growth.
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