Digitalization is causing job anxiety among young people

Digitalization is causing job anxiety among young people

Digitalization is causing job anxiety among young people

The FINANCIAL -- As the latest Credit Suisse Youth Barometer indicates, the effects of digitalization are at the root of uncertainties surrounding people's working lives, even among young people. This is most apparent overseas, probably because Switzerland, thanks to its dual education system, enjoys a certain degree of security which, for the most part, does not exist in other countries.

Furthermore, the Youth Barometer shows that young people in Switzerland are most concerned about retirement, while the relevance of issues surrounding foreigners, immigration, and refugees has fallen significantly in comparison to the previous survey. Accordingly, the relationship between young Swiss people and young foreigners is regarded as more and more harmonious.

In the past, the results of the Credit Suisse Youth Barometer painted the picture of a digital generation, one that has generally been quick and flexible in reacting to technological changes and trends. This year, however, the results clearly show that the changes in the labor market triggered by digitalization are viewed as a challenge, and at times, even as a threat. Particularly the young people surveyed in the US, Brazil and Singapore worry that in the future they may not have a job — or be able to find one — because of technological advancements. The exception in this respect is Switzerland. Even though the 16- to 25-year-olds in this country are certainly also confronted with these issues, only 34 percent (US: 79 percent) fear that their jobs will disappear.

Despite the uncertainty, the results of Credit Suisse's Youth Barometer 2018 indicate that young people by no means lack direction. They want to continually educate themselves further and are prepared to take risks. Entrepreneurship — building one's own company is very popular. Yet, the young people in Switzerland are less entrepreneurial than their peers in the US, Brazil and Singapore, where the IT and tech industry with its start-up culture is the most popular labor sector. In contrast, the young people of Switzerland prefer to work in education (56 percent), in the media (53 percent), tourism (50 percent) or administration (47 percent).

According to Lukas Golder, Co-Head of gfs.bern, the research firm conducting the Credit Suisse Youth Barometer since 2010: "In Switzerland, we have a strong openness towards technological change on societal, economic and political levels. The flexibility of Switzerland's education system facilitates lifelong learning and adapting to changing circumstances — this makes it easier for young people to respond in a relatively relaxed way to a rapidly changing environment. When job prospects are good, this also makes self-employment appear less attractive."

Retirement provision already a source of worry among the young, but only in Switzerland

For the first time this year, the main concern among young people in Switzerland is the state pension system. This shows a clear continuation of the trend seen in last year's edition of the Credit Suisse Worry Barometer. 

In the other countries, young people are most worried about unemployment (the US and Singapore) and corruption (Brazil). Other than in Switzerland, retirement provision does not even reach the top ten lists of the other countries examined.

Compared to the last survey, the young people in Switzerland considered the issues of immigration and asylum as much less significant problems. Since 2010, young Swiss people describe their relationship with young foreigners as increasingly harmonious. Only 11 percent categorized it this way eight years ago, and now it is 33 percent. There is a slight trend in the same direction in the US. Solidarity increasingly characterizes the millennials. For example, equality between men and women seems to be an issue facing young people in all countries.

Societal changes within the group of millennials should not be attributed solely to digitalization. A new set of values is emerging, and this in turn promotes new organizational and economic models. Under the motto "sharing instead of owning", the sharing economy has spread rapidly in recent years. The services and platforms such as Airbnb and car sharing services are also popular among young people. Around half of those surveyed had already made use of one of these platforms. On the one hand, sharing saves money in economically strained times, and allows for things to be bought that the young people otherwise would not be able to afford. Increasing prosperity is also no longer considered a given: 73% of Swiss young people indicate that they would already be satisfied if they can have as good a life as their parents. On the other hand, the Credit Suisse Youth Barometer also indicates that millennials feel strongly about using existing resources sustainably. Accordingly, young people in Switzerland consider climate change to be an important problem. Furthermore, the young people surveyed in the four countries feel that the sharing economy should be subject to regulation, just as other economic sectors. It remains clear that, despite the popularity of sharing platforms, young people still want to have valuable things for themselves.

The ten most important insights from the 2018 Credit Suisse Youth Barometer

Optimistic youth — but digitalization is a source of uncertainty: Three out of four young people in the US, Brazil, and Singapore worry that their job will no longer be needed in the future due to a changing labor market. They feel overwhelmed by the changes driven by digitalization. Only 34 percent in Switzerland fear that their job will disappear. However, young people are somewhat more optimistic about the future compared to 2016.

Fewer than 15 percent of those surveyed in Singapore and Brazil and less than 10 percent of those surveyed in the US and in Switzerland have a gloomier outlook.

Retirement provision as a top concern: Among young people in Switzerland, issues related to the Federal Old Age and Survivors' Insurance (AHV) are now the main concern. At the same time, the topic of foreigners and refugees has lost significance, and the coexistence between young Swiss people and young foreigners is regarded as more and more harmonious (2010: 11 percent, 2018: 33 percent).

Preference for jobs in administration over the IT industry: With the exception of Switzerland (43 percent), the IT/tech industry is the most popular labor sector by far (US: 75 percent, Brazil: 72 percent; Singapore: 75 percent). Young people in Switzerland would rather work in education (56 percent), the media (53 percent), tourism (50 percent) or administration (47 percent).

Widening information gap: Digitalization is not only affecting the ways that young people consume news with respect to frequency, but it is also creating entirely new issues as well. Relevant percentages of young people in all four of the countries surveyed consider the digital dissemination of fake news to be one of the top five biggest problems of their respective country. One thing is clear — the information gap is becoming wider and wider. While more young people are keeping themselves informed about current events several times a day, the number of those in Switzerland and Brazil who seldom or never check the news has grown significantly in recent years. Neither traditional nor new media channels are able to fill this gap for the "news deprived”.

Sharing economy and sustainability: Among young people, the sharing economy is very popular. Around half of the young people surveyed have already used such platforms at least once. This has economic reasons, such as saving money, but also ideological ones, as millennials feel strongly about using existing resources sustainably. Despite their general open-mindedness, millennials are also considering certain limitations: Sharing platforms should be subject to regulation, just as in other economic sectors. And the majority still wants to own things that are precious and valuable for themselves.

Saving continues to be popular: Of the young people surveyed, around one quarter would deposit a larger sum of money received as a gift into a savings account (a majority in Switzerland). Another 10 percent of the money would be saved for a rainy day. A strong majority wants to own a home. Around half of the young people (US: 59 percent; Brazil: 46 percent; Singapore: 48 percent) with financial obligations such as mortgages feel that these are a burden. In Switzerland, that group accounts for 39 percent.

Growing individualization: With only a few exceptions, a sense of belonging to individual social units in Switzerland has been declining among millennials since 2015. Friends and family are the social units offering the greatest sense of belonging, while religious communities and the online community were those with the least. Over the years, this diminishing sense of belonging to individual social units has been evident in Brazil and in some cases in the US as well.

First differences between Generations Y and Z: In Switzerland, young people use more and more communication technologies like WhatsApp, YouTube, streaming services, Instagram and Snapchat (other countries show a similar profile). Television and Facebook consumption is on the decline in Switzerland, although both of these are seeing an upswing in use in the US, Singapore and Brazil. The different platforms preferred by Generation Y (born between 1980 and 2000) and Generation Z (born after 2000) are evident: Twitter, Facebook and the internet in general versus Instagram, Snapchat, WhatsApp, and YouTube.

Political involvement once again gaining traction internationally: There is still little interest in being involved in institutional politics — such as working with a political party. On an international level, however, political involvement itself is once again gaining traction. Compared to 2016, over twice as many young people in the US are willing to take part in a demonstration. Equality between men and women seems to be an important issue in the US, Brazil and Singapore, and it is becoming more important in Switzerland.

In or out: The list of those things considered to be "in" is heavily impacted by digitalization. The top ten list in Switzerland includes the smartphone, WhatsApp, YouTube, Spotify and public transportation. In Switzerland and the US, Facebook no longer makes the cut. In the US, television is followed by the smartphone and YouTube as the most popular "in" things, while chat platforms such as WhatsApp or WeChat are most popular in Brazil and Singapore.

The Credit Suisse 2018 Youth Barometer — an internationally representative survey

What moves the next generation, which will shape society and the economy in the years to come — these questions are of great interest to Credit Suisse. Through its Youth Barometer study, Credit Suisse contributes important data for the public debate on socio-politically relevant topics and to the dialogue, in particular with the younger generation. The Youth Barometer has been compiled since 2010, providing insight into the lifestyles, problems and attitudes among young people. Roughly 1,000 young people between 16 and 25 years of age were surveyed in Switzerland, Brazil, the US and Singapore for the 2018 study. The research firm gfs.bern conducted the survey online between April and May 2018.

Promotion of young talent is important to Credit Suisse, so junior hires receive specific training, mentoring and career advice, aiding their transition to full-time employment. In the Swiss home market, where Credit Suisse is one of the country's biggest employers, there are opportunities for a large number of young people who are interested in starting a career in banking. At Credit Suisse, a total of 1,138 graduates of various school levels benefited from a systematic training program in Switzerland in 2017. Another example of how young talent is promoted is our award-winning Steps to Success program, now in its fifth intake, which offers university scholarship funding for UK and US students from underprivileged and underrepresented backgrounds.