Fewer young people, but is the youth market really shrinking?
Originally written in Chinese. Translated with AI, reviewed by Gary. Read the Chinese original →
Chatting with my team and partners today, we came across a rather interesting piece of data.
A question suddenly came up:
If we define "young people" as 18 to 24 year olds, did Malaysia have more of them ten years ago, or today?
My gut said today, obviously. Malaysia's population has kept growing.
But after checking the data, the answer was the opposite.
In 2016, Malaysia's total population was about 31.63 million. By 2026 it had grown to 34.39 million.
Yet if you use DOSM's age-group data to estimate the 18–24 population, it was about 4.39 million in 2016, and only about 4.20 million in 2026.
In other words, over these ten years Malaysia's total population grew by about 8.7%, while 18–24 year olds actually fell by nearly 190,000, about 4.3%. DOSM publishes population data in five-year age groups, so the 18–24 figure here is an approximation: the 20–24 group plus the 18 and 19 year olds from the 15–19 group.
Here's an easier way to picture it.
If you walk down the street today and feel Malaysia is getting more crowded, you're not wrong.
But in 2016, out of every 100 people, nearly 14 were aged 18–24.
By 2026, it's only about 12.
The trend fits Malaysia's ageing population. In 2026, the share of people aged 0–14 has fallen to 21.2%, those aged 65 and above have risen to 8.4%, and Malaysia's median age has reached 31.7.
So, as a fashion business, should we still go after the youth market?
If there are fewer and fewer young people, will that market keep shrinking?
As I kept digging, I found the data after the population numbers even more interesting.
Young people's wallets got bigger
First, a caveat.
The full 2026 Household Expenditure Survey isn't out yet, so I compared the latest one, 2024, with 2016. And this data isn't the spending of individual 18–24 year olds. It's households whose head is aged 15–24. So I treat it as a proxy for young people's spending power, not an exact match for individual spending.
In 2016, the average monthly income of these young households was about RM4,433. By 2024 it had reached RM5,735, up about 29%.
Spending too.
In 2016, average monthly spending was about RM2,989. By 2024 it was RM4,124.
Annualised, that's from about RM35,868 to RM49,488.
Roughly from RM36k a year to nearly RM50k.
The nominal basket size grew by about 38%.
Of course, a 38% rise doesn't mean young people's purchasing power rose 38%, because prices also went up over those eight years.
Overall CPI was about 115.1 in 2016 and 132.8 in 2024, cumulative inflation of about 15.4%. So the RM4,124 of 2024, in 2016 purchasing power, is roughly RM3,574.
Which means that even after inflation, young households' real consumption basket is still close to 20% bigger than in 2016.
So it isn't just "things got more expensive, so people spend more".
They genuinely have more money to spend than before.
But the most interesting part is this:
Where did they spend it?
From 2016 to 2024:
Food, roughly RM559 → RM715.
Clothing & Footwear, RM104 → RM128.
Housing & Utilities, RM735 → RM993.
Transport, RM339 → RM439.
Communication, RM165 → RM262.
Restaurants & Accommodation, RM500 → RM800.
A very interesting pattern shows up here.
Young people's wallets got bigger.
But the fastest growth wasn't in clothes.
Restaurants & Accommodation rose about 60%.
Communication, close to 60% too.
Clothing & Footwear only went from RM104 to RM128, about 23%.
Even more notable: in 2016, clothing and footwear made up about 3.5% of young households' total spending.
By 2024, it was only about 3.1%.
We've been asking the wrong question
I also realised we've been asking the wrong question all along.
The question may not be:
"Do young people still have money to buy clothes?"
The real question may be:
"Young people have more money now. Why aren't they spending more of it on clothes?"
Those two questions are very different.
Young people don't lack spending power.
On the contrary, they can spend more than they could ten years ago.
It's just that today there are so many things to buy.
Cafes, travel, concerts, phones, subscriptions, games, beauty, experiences, food delivery...
Fashion isn't just competing with other fashion brands for money.
We're actually competing with all of young people's lifestyle spending for that RM100.
Bring the population numbers back in, and it gets more interesting.
In 2016 there were more young people, about 4.39 million, but young households had less spending power.
In 2026 there are fewer, about 4.20 million, yet based on the latest spending data we can see, their purchasing power is clearly higher than ten years ago.
So "there were more young people ten years ago, so the youth market used to be bigger" is, I think, only half right.
A more accurate way to put it:
Ten years ago there were more young people. Today there are a few fewer, but the wallets in their hands are bigger.
For those of us in apparel, I think there are a few things worth seriously trying:
Stop looking only at youth population; look at share of wallet
How many pieces of clothing does a young woman actually buy in a year? How many of them does she buy from us? If she buys 12 pieces a year and we sell her one on average, a 5% drop in population matters far less than going from one piece to two. Going forward I'd rather look at annual spend per customer, purchase frequency and repeat rate, not just how many new customers we have.
Fashion needs to reconnect with young people's lifestyle
Since young people are willing to spend more on restaurants, travel and experiences, don't just sell "a dress". It can be a concert outfit, a holiday outfit, a first-day-at-work outfit, date night, a weekend cafe, a Raya gathering. Don't fight experiences for money; find a way to become part of the experience.
Don't just raise prices; study affordable frequency
Consumers having money today doesn't mean they're willing to pay more for an ordinary piece of clothing. Shopee, TikTok and cross-border e-commerce have pushed their value expectations very high. Rather than keep testing whether a RM29 item can sell at RM39, it may be more worthwhile to test how a RM29 product can get a customer to buy two or three at once, or come back six times a year.
Product development should look more and more like demand sensing
The youth population isn't growing fast anymore, which means we can rely even less on producing in volume and then figuring out how to sell it. I'd rather test more styles in smaller quantities each, use content, live, clicks, comments, add-to-cart and conversion to judge what real demand is, then scale up the styles that genuinely take off. Product isn't decided first and then matched with customers; we listen to customers first, then decide what to make.
CRM and retention will matter more and more
If the market's population isn't growing, we can't keep growing forever by buying new traffic. What's truly valuable is knowing what size this customer wears, what colours, cuts and price points she likes, how often she buys, and then reaching out to her when there's something right for her next time. A brand's real asset in the future isn't just followers, but an ever deeper understanding of its customers.
Conclusion
What I find most interesting about this research is that it changed my original question.
At first I asked:
With fewer and fewer young people, should we still be in the youth business?
After the research, my question became:
How many pieces of clothing is a young consumer willing to buy in a year, and how many of them do we actually get?
Population is something we can't control.
But whether a customer buys once or five times a year, whether she spends RM50 or RM500 with us, whether she thinks of us the next time she needs clothes: all of that is within our control.
So fewer young people doesn't necessarily mean a smaller youth market.
Judging by spending power, the wallet may even keep getting bigger.
What's really happening is this:
The wallet got bigger, but far more hands are reaching into it for that one ringgit than ten years ago.
That may be the real problem consumer brands face today.