The French population is sustained by an influx of immigrants, while businesses are becoming more diverse and inclusive. Consumer trends and consumption patterns sparked by the pandemic are still observed in 2022, and consumers are increasingly concerned about the environment and social equality. Inflation and economic inequalities are putting pressure on consumers, making them more conscious about their purchasing decisions.
This report comes in PPT.
France is set to continue facing increasing challenges from an ageing population. The sheer growth of the population aged 65+, coupled with low birth rates, will challenge the social welfare system of the country. While immigration slightly mitigates the pressure on the working population to support an increasing base of pensioners, the welfare system remains under pressure and overall purchasing power is constrained.
Delayed marriages, divorce and society’s changing values and social norms are boosting numbers of single households. Moreover, increasingly more families are choosing to not have children, leading to smaller households, with higher disposable income. Increasing share of childless families create an increasing demand for more tailored products and experiences, ready-to-go pre-packed food, while decreasing demand for family-sized packaged goods.
With the cost-of-living crisis, soaring inflation and rising interest rates, the French middle class is shrinking, unable to maintain its previously-held standard of living. While inflationary pressures persist and growth in real wages fail to meet rising costs of living, the disposable income of French households is set to shrink over the short to medium term, negatively affecting low-income and middle class families the most.
By 2040, the 40-54 age group (Millennials and early Gen Z) is projected to become the highest-earning demographic. Education, skills and asset accumulation will be key factors, influencing their income levels. Inheritance will also play a significant role, particularly as they enter middle age. Consequently, middle-aged individuals will hold substantial discretionary purchasing power.
Millennials and early Gen Z to become the highest income earners by 2040
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