Covid-19 is significantly impacting personal finances globally, with one-third already earning less and more than half expecting the pandemic to further affect their income and/or employment, a Standard Chartered survey has found, yet young people (aged 18-34) and those in emerging markets are the most confident in their digital skills and are prepared to adapt and work harder to realise opportunities in a post-Covid-19 world.
The study was conducted on 12,000 adults (aged 18 and above) across twelve markets – Hong Kong, Taiwan, mainland China, Singapore, Indonesia, Malaysia, India, the UAE, Kenya, Pakistan, the UK and the US.
It reveals a stark contrast between the financial reality that people face and their confidence in the future. This can be explained by a willingness – particularly among young people and those in emerging markets – to work harder, take steps to adapt income streams, and re-skill if they can, in order to earn more, Standard Chartered said in a press release today (August 6).
Young people are particularly confident, with 80 per cent of 18- to 34-year-olds feeling they have the digital skills needed to thrive post-pandemic compared to 63 per cent of those over 65. And with many graduating or leaving school in the midst of a global recession, younger generations are also more willing, or able, to adapt to the current circumstances. For example, 75 per cent of 25- to 34-year-olds would consider setting up a second income stream, compared to 40 per cent of those over 55. Meanwhile, and 72 per cent of all 18- to 44-year-olds would re-skill, compared to 37 per cent of those aged 55 and above, the company said.
Millennials and Generation Z are also more likely to respond to the crisis by starting a new business. For instance, 52 per cent of those aged 18 to 44 would consider doing so in the next six months, compared to 30 per cent of those 45 and above.
“Globally, this level of flexibility, adaptability and entrepreneurialism tends to decrease with age, along with confidence, despite – or perhaps because – older generations are more established in their careers.
"The divide is even more stark when comparing developed and emerging markets. Those in established global economies are not only less confident they have the digital skills needed to thrive amidst the downturn but are also less willing to adapt and take steps to increase their income,” Standard Chartered said.
More than 88 per cent of those surveyed in Kenya, mainland China, India and Pakistan said they would prefer to work more to get ahead than reduce their hours for less pay. Meanwhile, the UK and the US had the highest proportion of people who valued free time over more money – 38 and 33 per cent, respectively.
In terms of personal finances, respondents in Kenya (93%), mainland China (85%), Malaysia (83%) and India (82%) report the highest proportion of people who want to better manage their money to make it go further.
And while the pandemic has acted as a catalyst for the growth of online banking, with more than half globally using online services more, the shift has been apparent in fast-growing markets. For example, increased use of mobile devices for banking services is most prominent in India (79%), the UAE (72%), and Kenya (69%). Fast-growth markets are also more likely to want their banks to help improve their confidence at managing money digitally as they increasingly look to bank online – Kenya (91%), India (84%) and Indonesia (84%).
According to Standard Chartered, there is one clear area of almost unanimous agreement: a global desire for more flexibility when it comes to working arrangements post-Covid-19. For those for whom it is applicable, 71 per cent would prefer to continue working from home at least two days a week once restrictions are lifted and 77 per cent want more flexible working arrangements.
“Young people around the world have been hit particularly hard by the economic impact of the pandemic,” said Ben Hung, CEO of Retail Banking and Wealth Management and regional CEO for Greater China & North Asia at Standard Chartered. “Many are in insecure employment or graduating to a tough job market. Yet their confidence, adaptability and willingness to work hard, especially in fast-growing markets, provides hope for a recovery.
“Many are considering starting a new business in the wake of the pandemic and want to learn how to manage their finances better. They must be supported. Banks have a role to play both by helping them manage their money and providing tools that make banking easier so they can focus on leading the way to recovery,” Hung added.
Published : August 06, 2020
By : The Nation