The markets of the developed world have been dominated by the values, habits and preferences of the young population. Some of the most successful and most profitable businesses of the past half-century, such as Coca-Cola and Procter & Gamble in America, Unilever in Britain and Henkel in Germany, owe their prosperity in large measure to the growth of the young population and to the high rate of family formation between 1950 and 2000. The same is true of the car industry over that period.
The End of the Single Market
Now there are signs that the market is splitting. In financial services, perhaps America’s fastest-growing industry over the past 25 years, it has split already. The bubble market of the 1990s, with its frantic day-trading in high-tech stocks, belonged mainly to the under-45s. But the customers in the markets for investments, such as mutual funds or deferred annuities, tend to be over 50, and that market has also been growing apace. The fastest-growing industry in any developed country may turn out to be the continuing education of already well-educated adults, which is based on values that are all but incompatible with those of the youth culture.
But it is also conceivable that some youth markets will become exceedingly lucrative. In the coastal cities of China, where the government was able to enforce its one-child policy, middle-class families are now reported to spend more on their one child than earlier middle-class families spent on their four or five children together. This seems to be true in Japan too. Many American middle-class families are spending heavily on the education of their single child, mainly by moving into expensive suburban neighbourhoods with good schools. But this new luxury youth market is quite different from the homogeneous mass market of the past 50 years. That mass market is rapidly weakening because of the decline in the numbers of young people reaching adulthood.
In future there will almost certainly be two distinct workforces, broadly made up of the under-50s and the over-50s respectively. These two workforces are likely to differ markedly in their needs and behaviour, and in the jobs they do. The younger group will need a steady income from a permanent job, or at least a succession of full-time jobs. The rapidly growing older group will have much more choice, and will be able to combine traditional jobs, non-conventional jobs and leisure in whatever proportion suits them best.
The split into two workforces is likely to start with female knowledge technologists. A nurse, a computer technologist or a paralegal can take 15 years out to look after her children and then return to full-time work. Women, who now outnumber men in American higher education, increasingly look for work in the new knowledge technologies. Such jobs are the first in human history to be well adapted to the special needs of women as childbearers, and to their increasing longevity. That longevity is one of the reasons for the split in the job market. A 50-year working life — unprecedented in human history — is simply too long for one kind of work.