Generation Y Earns $211 Billion and Spends $172 Billion Annually

Rochester, NY—September 3, 2003— American kids, teenagers, and young adults, aged 8 to 21 years, have annual incomes totaling $211 billion, according to latest projections based on results of a nationwide survey of the Generation Y population. Results show that this group is spending at a rate of approximately $172 billion per year and is saving at a rate of $39 billion per year.

The economic downturn and recovery has been felt in the youth market. The annual incomes among 8 to 21 year olds is down from Harris Interactive’s projection of $231billion in 2002, although spending is up from a projection of $155 billion in 2002.

These are among the findings of Harris Interactive YouthPulse^SM, an online study of 3,432 young respondents conducted in June 2003. The study projected the income, spending, and savings habits of Generation Y. The spending power of young consumers grows substantially with age and is concentrated in the upper end of the Generation Y age range:

• Pre-teens (ages 8-12) spend at a rate of $19.1 billion annually, or $946 per capita;
• Teens (ages 13-19) spend at a rate of $94.7 billion annually, or $3,309 per capita;
• Young adults (ages 20-21) spend at a rate of $61.3 billion annually, or $7,389 per capita.

"There are more than 57 million individuals in the 8-21 age group, and their influence on the consumer economy is immense," said John Geraci, vice president of youth research at Harris Interactive. "Generation Y’s needs and opinions drive many adult purchase decisions, and they, literally, represent the future market for most consumer brands."

The study results indicate that youth income is down over the past year, but spending is up. "This shows that this age group has been willing to forgo savings in order to keep their spending levels consistent," said Geraci. "It is a very optimistic generation, and they demonstrate a great deal of confidence that the economic rebound is around the corner and that good times are ahead for them."

The study showed that the sources of income for young people evolve as they age. A majority (87%) of income for children under age 13 years is parent-supplied – either through allowances, asking parents for money, or through money earned from special chores or household work. In contrast, 37% of teens’ income and 7% of young adults’ income is parent-supplied. Not surprisingly, teens and young adults rely predominantly on paid jobs for their income.

Fifteen percent (15%) of youth spending is done online, and this percentage was consistent across the 8-21 age range and with projections for 2002. However, boys remain more comfortable with ecommerce, as they spend 1.7 times as much as girls do online.

"We also found that during the course of a year, Generation Y puts 62% of their income into savings at some point, but only 19% of their total income ends up in savings in the long term," Geraci added. "On average, young people carry less than $30 with them, so they need to constantly connect to their income source or savings to buy things."

This study was conducted online within the United States in June 2003, among a nationwide cross section of 3,432 members of Generation Y, aged 8-21 years. Figures for age, sex, race, and region were weighted where necessary to bring them into line with their actual proportions in the population.

In theory, with a probability sample of this size, one can say with 95 percent certainty that the results have a statistical precision of plus or minus two percentage points of what they would be if the entire youth population had been polled with complete accuracy. Unfortunately, there are several other possible sources of error in all polls or surveys that are probably more serious than theoretical calculations of sampling error. They include refusals to be interviewed (non-response), question wording and question order, interviewer bias, weighting by demographic control data and screening. It is impossible to quantify the errors that may result from these factors. This online survey is not a probability sample.

The Harris Interactive YouthPulse study covers a range of topics of concern to Generation Y, including their income and spending, the role of technology in their lives, their relationships with their parents and families, and their hopes and aspirations for the future. YouthPulse is available on a subscription basis.

About Harris Interactive^®

Harris Interactive (www.harrisinteractive.com) is a worldwide market research and consulting firm best known for The Harris Poll^®, and for pioneering the Internet method to conduct scientifically accurate market research. Headquartered in Rochester, New York, U.S.A., Harris Interactive combines proprietary methodologies and technology with expertise in predictive, custom and strategic research. The Company conducts international research through wholly owned subsidiaries—London-based HI Europe (www.hieurope.com) and Tokyo-based Harris Interactive Japan—as well as through the Harris Interactive Global Network of local market- and opinion-research firms, and various U.S. offices. EOE M/F/D/V

To become a member of the Harris Poll Online^SM and be invited to participate in future online surveys, visit www.harrispollonline.com.

Press Contacts:

Nancy Wong
Harris Interactive
585-214-7316
nwong@harrisinteractive.com