I went into Auckland's Viaduct on Easter Sunday to meet some friends and have lunch. There were very few people about and the restaurant we went to didn't charge a "surcharge" for eating out on Easter Sunday. Maybe people are happy staying home at Easter with their families?
While chatting over lunch, one major issue that we stumbled upon was the major occupations that have contributed most to wealth over the past couple of years over all others.
In discussion, we decided that real estate agents and funeral directors would be way out in front of money earned during the past couple of years.
So what's the common denominator with these two occupations? The answer is the aging population.
Suddenly this group of mainly retirees is being targeted by all types of commercial operators for access to the wealth that they possess.
There is however a limitation on the type of spend that this group generates. Food and entertainment are high on the list, as is travel and accommodation. Thereafter, the spend by retirees diminishes. Apparel purchases are a typical example of how changing times impacts on various merchandise categories. Work attire is far more casual now than it was just 10 years ago, and retirees simply don't have to dress up anymore. "Casual" is the dominant dress word. Formal is infrequent and maintained as the standard for very special occasions.
This group has by far the biggest spend 'opportunity' over any other group.
No longer do they have to worry about their finances as they once did, and although still cautious, it is apparent that they have a desire to smell the roses while they are still able. Added to this is the benefit they receive from the value that their homes have created driven by the surge in the property marke. Selling a home in Auckland and retiring to an alternative regional location is now the norm and the capital gain derived from that sale and relocation sets many people up in a very comfortable retirement economic environment.
Consequently, this group of consumers dominate the market spend. Living longer will also ensure this group continue to remain dominant. So, who can tap into this wealth for commercial gain? Already, the real estate industry professionals are benefitting, but the knowledge base that this group of retirees possess is truly an opportunity that must benefit companies looking for reliable, responsible and knowledgeable employees. No longer does this group retire early, they want to continue contributing to society and companies could do a lot worse than engage them in on-going business activities. Who cares about the age, provided the skill base remains intact? Aging will be a serious employment opportunity for companies in the future. Why wait for the funeral director to turn up when opportunities for the future are significant.
Paul Keane is a registered property professional and has vast experience in New Zealand’s commercial property industries. He provides retail and property consultancy including development management to many New Zealand property owners, developers and city councils. This post originally appeared on RCG's blog.