Society - Written Friday, March 20, 2009 by Naumi Haque - 5 Comments

Recession and the psyche of a generation

Economic downturns tend to invoke a lot of immediate concerns – understandably, people are worried about jobs, security, and keeping a roof overhead. But, I often wonder how this will affect our personalities in the long run. Just think of your grandmother hoarding elastic bands and paying the grocer in exact change – behavioural imprints (or scars) left over from previous economic traumas.

Joseph Brusuelas, economist at Moody’s Economy.com is quoted in the Wall Street Journal as saying he fears “we’ve lost a generation of investors.” His take was that people won’t invest because they won’t have the money to do so, but I think it’s safe to say that there will also be a certain lack of trust in the market. Have we gained a generation of entrepreneurs? A generation of socialists, scrutinizers, realists, and environmentalist?

Jon Stewart’s “senior black correspondent” Larry Willmore jests that the swath of white collar crime leading into the recession will change the face of criminality in America such that the Wall Street look (i.e. white men in suits and ties) will be seen as inherently untrustworthy in the future. Willmore’s analysis is satirical, but looking at our own research here at nGenera, Scrutiny and Integrity are two of the eight norms of the Net Generation that will definitely be amplified by the recession (the other norms are Freedom, Customization, Collaboration, Entertainment, Speed, and Innovation). If the Net Gen weren’t already scrutinizing corporate America before, they certainly will be now.

For some deeper thinking on the effect of the recession on the Net Gen, I turn to Fast Company staff writer and author of Generation Debt, Anya Kamenetz. As Anya rightly noted in one of her Yahoo! Finance columns, “Economic dramas shape an entire generation’s beliefs about the nature of the economy and the risks involved.” That was a year ago and already she was postulating about how the Net Gen’s psyche might be shaped. Specifically, she noted that young people:

• Won’t expect to get rich quick.
• Will “get real” about consumption.
• Will buy on the cheap.

I spoke with Anya recently so I thought I’d ask her to elaborate on her thinking.

What effect do you think this recession will have on the psyche of people entering the workforce now?

“The climate in the last 10 years has been a very unrealistic one. We have been living in this huge bubble. For young people who are entering the 20’s now, this is really all they knew: Inflated expectations, ridiculous monthly consumer debt, and the idea that you don’t need to save for the future because you can just count on the equity in your house. But, when the bubble bursts, the paradigm shifts. For young people now, they are really looking around and seeing the world as being a very different place. For older people, it can be a lot more traumatic to have this happen, but for young people, they’re more ready to maybe accept that change.

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