Millennial fever is infecting the corridors of power as managers and marketers struggle to understand Australia’s largest generation.

Social analysts call them impatient, overly self-confident, self-absorbed, self-important, lazy, easily bored, spoilt, constantly in need of positive affirmation, and disloyal.[1]

Entrepreneurs see them as tech-savvy, early adopters: perfect fodder for digital disruption.

Marketers see them as ambitious, urban dwelling, highly educated, big-spending consumers of technology products and high-end experiences.

But are the stereotypes accurate? Or is it all a myth, a giant generational hoax?

Born between 1982 and 2004, and also known as Gen Y or the Digital Generation, there are 5 million Millennials in Australia. The nearest generation by size is Gen X at 4.7 million followed by Baby Boomers at 4.2 million.[2]

According to Roy Morgan, 38 percent of Millennials are in the ‘Big Spender’ category (top third of elective spenders in the economy), and 24 percent are in the AB socioeconomic quintile. Compared to the general population these numbers look OK. For example, 33 percent of Australians are big spenders and 20 percent are ABs. So the Millennials look reasonable, but not great.

The myth really gets busted when we recognise that there are two fundamentally different mindsets in the Millennial generation. So different, in fact, that they constitute two entirely different economies – the NEO Economy and the Traditional Economy.

The NEO Economy is the cool current in an overheated, overhyped ocean of product marketing, where basic needs are satisfied automatically and expeditiously. This is where 1.6 NEO-Millennials seek the path less travelled; signposted with authenticity, human scale, high-touch and digital disruption. This is where Millennials look like, well, Millennials.

However, over in the traditional economy there are even more Millennials, but they look nothing like the stereotype.

Only 8 percent of the 1.8 million Traditional Millennials are early adopters of technology, compared to 52 percent of NEO-Millennials. And only 9 percent of Traditional Millennials have a university degree, compared to 53 percent in the NEO Economy. They’re all Millennials. But the two mindsets are as different as truffles and button mushrooms.

It’s not surprising that the Millennial generation on its own is a poor predictor of anything. It is based on just one factor – age. Think about a 26-year-old single mum holding down three jobs just to pay the bills. She’s a Millennial, but she doesn’t look anything like the stereotype. So the Millennial generation is great at telling us how old someone is, but not much else.

Using highly-predictive discriminant modelling, the team of data and social scientists at the Centre for Social Economics identified 192 values, attitudes and behaviours that define NEO-Millennials inside the $600 billion NEO Economy.

Is the urban Millennial a myth? Not in the NEO Economy where almost three-quarters (72 percent) live in capital cities. Over in the traditional economy, however, there’s almost no difference between Traditional Millennials and the Australian population living in capital cities.

NEO-Millennials earn more, spend more more frequently, are quick to embrace new technology and digital disruptions, are better educated than any other generation, and are the poster child for entrepreneurs, employers and marketers. But the 1.8 million Traditional Millennials are not.

Myth busted. Well, half the myth busted.

[1] Myers, K. & Sadaghiani, K. 2010, ‘Millennials in the workplace: A communication perspective on Millennials’ organizational relationships and performance’, Journal of Business and Psychology, vol. 25, no. 2, pp 225–238.

[2] Source: Roy Morgan Single Source database (n=256,124)