Even People In Their Early 20’s Are Spending Less

City workers in their early twenties, who are known to have a high tendency to consume compared to other generations, are drastically cutting down their spending due to the economic recession.

Monthly average expenditures for the 1st quarter for households which have head of households younger than 24 dropped to 1,383,524 won, which is 11.4 percent less than the 1,562,202 won for the 1st quarter of last year, according to the household balance of city workers announced by the Korea National Statistical Office on June 13.

This reduced rate of consumption in a quarter was the largest in five years and three months, since the 23.6 percent decrease in the 4th quarter of 1998, when the financial crisis hit the nation.

It showed a huge contrast with the 8.5 percent increase in spending of all households in the city this year (2,147,554 won), compared to the 1st quarter of last year.

The 1st quarter expenditure of households that have head of households younger than 24 was 882,858 won in 1995, increased to 1,048,626 won in 1997, and dropped again to 955,889 won in 1998.

The trend turned downward this year after it continuously increased from 1,150,849 won in 2000, 1,377,650 won in 2001, and 1,450,568 won in 2002.

The reason that people in their early twenties are spending less than before is not only because their incomes are decreasing as economic recession lengthens, but because payments through credit cards deteriorate their spending abilities.

The monthly average household income for city workers younger than 24 during the 1st quarter of this year decreased to 2,116,007 won, which is a 1.8 percent drop compared to 2,154,731 won for the 1st quarter of last year.

Whereas the spending of those in their early twenties fell, the expenditures of households that have head of households older than 55 showed an 18.6 percent increase amounting to 1,931,610 won for the 1st quarter of this year, compared to 1,628,905 won for the 1st quarter of last year.

Jong sik Kong kong@donga.com