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Despite the economic power of the baby boomer generation, there are few details available about the financial and health challenges they will face over the next 10 years. And while researchers tend to see the boomers as one big homogeneous group, there are many significant socio-economic differences among them. Research by the McKinsey Global Institute and McKinsey & Company’s Marketing Practice fills in these knowledge gaps and outlines the implications and opportunities for businesses. The work provides an eye-opening portrait of this generation in 2015 based on economic forecasting, surveys, and interviews with boomers from a variety of backgrounds. Below is a summary of key points and fascinating statistics from the study. For more insight and fleshed out research, check out the McKinsey Quarterly by clicking here.
Baby Boomers Defined
- 77 million Americans born between 1946-1964, the baby boomer years
- Boomers will account for 40% of US consumer spending by 2015
Living the Good Life?
- By 2015, there will be 21 million single 51- to 70-year old boomers
- 46% of boomers fear ending up alone
- 43% feel frustrated they are not leading the lives they expected
- 86% of boomers say they have always believed they deserved a good life
Unprepared but Undeterred
- Despite their collective wealth, only 25% of boomers are financially prepared for retirement.
- More than half of boomers—a massive segment comprising 24 million households—are U3 Boomers, that is, they are unprepared, uncompromising and undaunted.
- But overall, they remain optimistic about the future, are highly educated and resourceful.
Ultimate Consumers
- 80% of boomers enjoy trying new products and services
- 85% find the Internet to be an important solution for them in dealing with their lives
- Nearly 80% believe they control their own destiny and can survive any challengers they face.
Workplace Boomers
- Workers over 50 will rise steadily from 20 percent of the workforce to 32 percent by 2015.
- For the first time ever, there will be as many 50-59 year olds in the workplace as 30-40 year olds.
- Yet many boomers will need to leave their jobs. This means companies could lose 60 to 80 percent of their key knowledge workers over the next 10 years, creating a potential labor shortage in key jobs.
Baby Boomers Defined
Companies will be richly rewarded in the years ahead if they can help boomers redefine the idea of retirement, protect their health and wealth, achieve their aspirations on a budget, and create a sense of community. Companies that are themselves unprepared for the boomers’ later years will be disadvantaged.
McKinsey & Company’s research supports a call to action for companies to:
- Understand and properly serve aging boomers as new customers
- Determine what role boomers can play in their organizations
- Shift products and services to address the rise and fall of boomer spending
- Invest now to develop new products and services to address aging boomers’ needs, especially the “U3 boomer” segment
Want to know more? Click here for in-depth research on the U3 boomer opportunity in the McKinsey Quarterly.
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