It isn’t easy to succeed in today’s wedding market, as bankrupt bridal gown company Alfred Angelo and struggling David’s Bridal have discovered. Once an evergreen market where businesses could depend upon a steady demand for products and services, the wedding market hit the skids during the recession and has yet to recover.
With a total market size estimated at about $72b in the US, young couples today are just not buying into marriage like they used to, despite the fact that the millennial generation is the largest in history. If they were following historic traditions, it would translate into a thriving wedding market, not to mention the expansion of the total market due to weddings of same-sex couples.
Rather than rising, however, the rate of marriage is declining, from 8.2 marriages per 1,000 in 2000 to 6.9 in 2016, according to the CDC/NCHS National Vital Statistics. While much of the blame is laid to millennials delaying marriage until later in life, now 29.5 years for men and 27.4 years for women, the 92 million strong millennial generation spans 18-38 years of age and should be bolstering the wedding economy now, despite the lag in age of marriage.
What changing demographics mean to the wedding market
A new study from James Allen, the online diamond jewelry retailer and a Signet Jewelers Limited brand, suggests that a wedding is a luxury that millennials simply can’t afford. With The Knot finding that the average cost of a wedding exceeded $35,000 in 2016, couples feel forced to create ever more extravagant wedding experiences to make their day memorable for themselves and their guests.
This heavy financial burden is causing some 30% of couples to delay their wedding plans, according to the JamesAllen.com survey of 5,000 recently married US adults. This compares to only 8% of couples 10 years ago, when Conde Nast Bridal Group estimated the cost of a wedding was still a sizeable $28,000 in 2006.
Everything leading up to and including the wedding is getting more expensive. In the past ten years, the average cost of the engagement ring has gone from $5,100 to $7,900, a 55% increase. The cost of the proposal, not including the ring, is now $452, up 67% from $271 ten years ago, as the proposal event has become more extravagant with family and friends and even pets often participating and with photographers hired to record the festivities. The strain on finances has caused some 20% of couples surveyed to downsize their bachelor/bachelorette party and some 30% to downsize their wedding and reception, according to the James Allen study.
The cost of the wedding gown, however, has largely remained steady, at just over $1,500, as reported by the Bridal Association of America in 2006 and The Knot in 2016. But this bit of budgetary good news is offset by significantly greater emphasis on custom experiences provided for the wedding guests, which has tripled from 11% in 2009 to 41% in 2016, according to The Knot, for things like photo booths, games, musical performances, often including both live music and DJs, fireworks and wine tastings.
All of which leads me to ask whether the growing economy will give a boost to the wedding market. To answer that we need to look at the motivations that cause people to get married in the first place and based on that, it is not a given that a stronger economy will encourage more people to tie the knot.
Millennial’s attitudes are shifting against not for marriage
Young people don’t see the benefits of marriage in the same way as previous generations do. In a study conducted by Pew Research Center, over two-thirds of millennials age 18 to 29 said that society is just as well off if people have priorities other than marriage and children, as compared with one-third who believe that society is better off if people make marriage and having children a priority. This stands in sharp contrast to those aged 50 and older where 55% said marriage and having children is better for society at large.
As a result, Americans’ attitudes about marriage are undergoing dramatic shifts. While love, making a lifetime commitment and companionship remain the primary reasons people marry, more Americans are choosing to remain single, according to Pew. And if they partner up, they are more likely to live together, even raise children, without formally marrying, most especially if they are younger.
Today 50% of adults are married and that incidence has been on a steady decline since 1960 when it was 72% dropping to 54% in 2000. Being single and remaining single is an accepted lifestyle choice for more Americans. While nearly 60% of some 1,000 single adults surveyed by Pew in August 2017 said they hope to get married someday, the remaining 40% are on the fence, with 27% not sure if they want to marry and 14% committed to the single lifestyle.
The perceived luxury of marriage is increasingly cutting out a significant share of the population. Lower-income and less-educated Americans are less likely to marry and in so doing, exclude themselves from the financial benefits that a marriage and the potential of combining two incomes can mean. On the other hand, college-educated Americans are more likely to marry than those with only high-school educational attainment. Thus those already destined to earn less over their lifetime are foregoing the financial gains of marriage that those headed for higher earnings are choosing.
Besides these socioeconomic factors, increasingly race and ethnicity play a role in choosing to marry. White and Asian adults have a far greater likelihood to be married, 54% and 61% respectively, than Hispanics (46%) or blacks (30%). Households headed by whites and Asians also tend to have higher average income than Hispanics and blacks, as well.
While these marriage statistics only show correlation of socioeconomic and ethnic factors, not causation, married households have higher average incomes than single ones and a recent study by TD Ameritrade finds that married couples are significantly more financially secure than singles. Specifically, only 29% of single adults consider themselves financially secure, whereas 43% of married couples say the same.
One might conclude that a one-time investment of $35,000 in a wedding could be a wise one delivering a significant lifetime return in both financial well being and quality of life both physically and psychologically. Of course, one has to choose the right partner to garner these lifetime benefits, since an unhappy marriage and divorce bring a boatload of financial and psychological stresses.
A strong economy is not likely to turn the tide and encourage more young people to get married, despite the fact that doing so would likely set those young people up for a more prosperous, financially secure future , which in turn would create a virtuous circle back into the economy as new households are formed and families grown. Rather than being a luxury, marriage might be the necessity that makes luxury possible.