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Nearly Half of Gen Z and Millennials Say We’re Already in a Recession

Since talks of a recession began, YPulse has been asking young consumers their thoughts, and more than ever say we’re already in one… 



  • Over 90% of Gen Z and Millennials say we’re going into a recession in the near future, or are already in one
  • With so many saying we’re already in a recession, they plan to spend only on necessities—especially financially stressed Millennials
  • Young consumers are prepared to change their spending habits in nearly every category should we go into a recession

For months now, experts have been going back and forth on whether we’ve gone into a recession—and Gen Z and Millennials are torn on what to believe. For as long as they remember, recessions have only ever been major market crashes; Millennials came out of college into the Great Recession, and Gen Z have even told YPulse they don’t remember a time before the recession. Both gens experienced the quick, but intense, COVID crash. Now, as many predict a less extreme recession, young people aren’t sure exactly what to expect. But YPulse data shows that most do think a recession is coming—and many think it’s already happening: 

Line chart showing how many Gen Z and Millennials think we are currently in a recession

Nearly half of young people say a recession is already under way 

Currently, half Gen Z and Millennials (47%) are currently predicting an incoming recession, but nearly the same amount (44%) say it’s already happening—and have been saying so for a while. Since YPulse first asked in August, no less than 40% of young people have said “we are currently in a recession,” with little variation in the number who believe that it is happening.   

The number who say “we are going to be in a recession in the near future” has steadily moved up since September, when it first dropped from 50% to 44%. In that same time between August and September, 7% who said “we are not going to have a recession,” jumped to 17% amidst constantly conflicting news. But it’s steadily declined back down to 9% since then, and these mirrored trends show weakening confidence in the economy as the new year approaches. 

Young people continue to see the signs of recession: growing inflation and headlines about massive layoffs. At the same time, they hear the good news is wages have continued to increase—but not quickly enough to keep up with inflation. This leaves the definitive answer in limbo as no formal declaration of a recession has been made; but for many Gen Z and Millennials, what they’ve seen is proof enough—and more are saying so than ever.  

But regardless of a recession, inflation has plagued these gens all year, putting the cost-of-living crisis at the front of their minds. Young people say that inflation is the biggest issue their generations are currently facing—with Millennials especially concerned. The state of the economy has already impacted seasonal shopping like back to school, and 69% of young people say it’s impacting their holiday shopping budget this year. YPulse’s Brand Tracker data also shows an uptick in affinity for dollar stores over the course of the year as prices rose (and continue to). 

How would they respond to a recession financially?  

YPulse asked Gen Z and Millennials what they would do if we went into a recession right now in our Personal Finance and Services report. Of 11 options ranging from switching to cheaper brands to increasing their income, their most popular answer is that they would “only buy the things I need” with nearly half saying so. Following that, 35% of Gen Z say they would “reconsider my spending habits,” while 41% of Millennials say they would “cook at home more.” 

Knowing young consumers say they would only buy the things they need should a recession occur (which most think will, or already is), YPulse also asks exactly what they would cut back on if it happened right now: 

Bar chart showing what 13-39-year-olds say they would cut back spending on if we went into a recession

Dining out, clothes, and new tech would be the first to be cut from their budgets 

Of all their expenses, dining out / ordering takeout is the thing Gen Z and Millennials are most likely to say they’ll cut back on in a recession. This would be significant for their budget, as 54% of all young people, employed or not, tell YPulse they typically spend their money on dining out / ordering takeout, an expense second only to clothing, shoes, accessories, and apparel. More than a third of each gen say they’d cut back on clothes shopping—which our Mass Merch Mentality report shows they’re already doing at budget friendly retailers, so this could mean updating their closets less frequently.  

Gen Z are more likely than Millennials to say they would cut back on spending on new tech like phones, computers, and gaming consoles. With the holidays just around the corner, YPulse’s Gaming report shows 47% of young gamers say they aren’t planning to buy a new console this holiday season—but Millennials are less likely to say so. After a long year, the gen is likely holding onto a purchase to look forward to, or to get for their children.  

Millennials are significantly more likely than Gen Z to say they would cut back on “saving for the future”—21% vs 9%—an unfortunate reality they’ve experienced before. YPulse data shows 90% of Millennials agree saving money is important to them, but 64% also agree they’re worried they’ll never meet their financial goals.  

Knowing that nearly half of young consumers say we are already in a recession, these financial cutbacks may already be underway. We know they’re doing what they can to manage their holiday spending responsibly, and other areas might be drawn back even further. Given that one third or more of young people say they’d cut back in every category other than groceries and beauty / skincare products, most every brand should be prepared for frugality from young consumers.