Nepal’s Gen Z: The Next Economic Engine

In early September 2025, Nepal witnessed its most intense youth-led unrest in years. Mass protests, driven primarily by the Generation Z, shook the nation. Frustration over widespread inequality and pervasive corruption fueled the demonstrations, which escalated to violence, including a storming of parliament that forced Prime Minister KP Sharma Oli to resign.

 

What began as online activism on platforms like TikTok and Instagram, amplified by images of elite lifestyles sharply contrasting with ordinary people’s struggles, soon became a defining symbol of generational dissatisfaction.

 

This surge of activism reflects deeper economic and social realities. Nepal’s Gen Z is highly educated, digitally fluent and globally connected. Yet, many face unemployment, underemployment and limited access to capital. Their aspirations for entrepreneurship and meaningful employment often collide with systemic barriers. The protests were not only a rejection of political leadership but also a demand for economic opportunities aligned with their skills, ambitions and digital fluency.

 

The Global Economic Power of Gen Z

 

Globally, Gen Z is emerging as a formidable economic force. Representing roughly one-fourth of the world’s population and workforce, they are rapidly entering workplaces across the world. According to EY, the global consulting firm, by 2034, millennials and Gen Z will make up 80% of the workforce in advanced economies.

 

Known for valuing work-life balance, this generation approaches work differently. They adapt quickly to new technologies, innovate in their work patterns and aspire to entrepreneurship—often preferring to be their own bosses.

 

Bank of America projects that by 2040, Gen Z will collectively earn over $74 trillion in income. While many currently struggle to cover housing or personal expenses, they are on track to become the wealthiest generation in history. Raised in the era of social media, online gaming and global digital culture, Gen Z is both tech-savvy and culturally fluent, with the ability to set global trends almost instantly.

 

By 2030, they are expected to control $12 trillion in spending power. Their strong preference for eco-friendly, ethical and tech-integrated products is already pushing industries toward sustainability. From e-commerce and digital entertainment to electric vehicles and fintech, Gen Z is not just entering the global economy—they are reshaping it. Their priorities—technology, sustainability and equality — will determine which industries thrive in the decades to come.

 

Gen Z’s Share of the Global Economy

 

Gen Z’s consumption patterns diverge sharply from those of previous generations. While millennials focused heavily on household or baby products, Gen Z is more inclined toward wellness, beauty, food and beverages.

 

 

Today, their direct consumer spending accounts for an estimated 9–11% of global GDP, and that share is steadily growing. According to World Data Lab, Gen Z is already responsible for 17.1% of global spending, amounting to $57.6 trillion. As they mature, they are expected to make up nearly one-third of the global labor force.

 

In the US, about 15% of Gen Z works as freelancers, particularly in e-commerce, streaming and fintech, generating roughly 15–20% of global revenue in these sectors. With their entrepreneurial drive, Gen Z is projected to drive 20–30% growth in high-value sectors, contributing directly and indirectly to 12–15% of global GDP. Realizing this potential, however, requires investments in skills, greater access to capital and supportive regulatory frameworks.

 

The Roles They Play

 

As consumers, Gen Z drives global demand. They often spend beyond their current earnings, particularly on digital products, technology, wellness products and beauty items. From smartphones to subscription services, the global markets are already designed with them in mind.

 

As workers, they demand purpose, inclusivity and work-life balance. Comfortable with AI, coding and data analytics, they expect digital workplaces equipped with modern technology and supportive cultures. However, pay often falls short of their expectations. When dissatisfied, many are willing to leave jobs and start their own ventures — a trend already visible as more young entrepreneurs launch businesses during or shortly after their education.

 

As investors, Gen Z is also actively shaping financial markets. They are drawn to cryptocurrencies, stocks and index funds, showing a willingness to experiment with new financial tools and platforms.

 

Collectively, Gen Z is transforming consumption patterns, redefining workplace behavior, professional expectations and investment trends worldwide.

 

Context in Nepal

 

In Nepal, Gen Z is approaching life and work differently from previous generations. While Gen Y often pursued higher education or migrated abroad for jobs, Gen Z prefers to start businesses—even before completing college. They recognize that foreign employment no longer guarantees the lifestyle they desire, and they are less willing to conform to traditional work norms. Instead, they actively side hustles, digital opportunities and entrepreneurial ventures.

 

 

Nepal’s youth are at the center of the country’s digital economy. They are the primary consumers of online shopping, food delivery, e-learning and digital entertainment, fueling growth in ICT, telecom and education sectors. Yet, skill mismatches and limited formal jobs continue to push many abroad. Migration remains a defining trend, with large numbers of youth working in South Korea, UAE, Qatar, Malaysia and Japan. Their remittances remain a cornerstone of Nepal’s economy.

 

At home, Gen Z is reshaping industries ranging from construction and ICT to creative industries. Many have been modernizing family businesses by integrating technology, while government initiatives like the Youth Self-Employment Fund (YSEF) provide seed support for entrepreneurship. Although most startups are small today, they form a growing base for domestic production and long-term growth.

 

Beyond the formal economy, Gen Z thrives in the informal sector. They freelance, vend in streets, farm and experiment with digital entrepreneurship. Teenagers and even schoolchildren help run family shops, while platforms like Daraz and YouTube have opened new income streams. This creativity highlights their ability to merge traditional livelihoods with digital commerce.

 

This generation’s influence spans fintech, e-commerce, education, health and agriculture. By blending innovation with traditional industries, Gen Z is gradually pushing Nepal’s GDP toward knowledge- and technology-based activities.

 

Global Lessons in Youth-driven Transformation

 

Around the world, young people have repeatedly demonstrated transformative economic power. In South Korea, K-pop—led by BTS—generates an estimated $4.65 billion annually, creating thousands of jobs in entertainment, tourism and education. In Silicon Valley, Mark Zuckerberg co-founded Facebook at just 19, reshaping the global digital landscape.

 

In India, Shriyans Bhandari upcycled 600,000 discarded shoes into new products while empowering rural women. In Kenya, the “Silicon Savannah” initiative expanded tech exports from $16 million to $360 million within a decade. Historically, youth played a decisive role in Japan’s post-war industrial boom, China’s rural reforms in the 1970s and Germany’s Wirtschaftswunder, which doubled GDP between 1950 and 1960. These examples show how younger generations have repeatedly sparked waves of innovation and growth.

 

Challenges Facing Nepal’s Gen Z

 

Despite their potential, Nepal’s Gen Z faces structural hurdles. Many remain confined to short-term or gig work with little security. Education-to-employment mismatches leave talented graduates underutilized. Entrepreneurial ambitions are constrained by fear of failure and limited access to capital.

 

Mental health is another growing concern. High expectations, financial insecurity and weak workplace support contribute to stress and anxiety. With few institutional mechanisms to address these challenges, frustrations are intensifying. Migration continues to be an escape, with more than 1,000 skilled workers leaving Nepal daily. However, this outflow risks long-term talent loss and stunted domestic growth without systemic reforms.

 

Yet, Gen Z’s potential remains immense. If they are provided with the right support, they can drive innovation, entrepreneurship and industrial transformation. Expanding access to finance, bridging skills gaps and prioritizing mental health could unlock their contributions to national development.

 

The Future of Nepal’s Economy

 

Gen Z is not just Nepal’s current workforce; they are its future growth engine. They are already powering digital industries, green businesses and entrepreneurial ventures. Their values, centered on technology, sustainability and inclusivity, position them to reshape employment and GDP composition.

 

Through targeted reforms in education, policy, entrepreneurship and governance, Nepal can harness this demographic advantage to build a more self-reliant and innovation-driven economy. By investing in Gen Z’s creativity and digital fluency, Nepal can move from remittance dependency toward sustainable domestic growth.

 

Ultimately, Gen Z has the power not only to increase GDP but to transform the economy into one that is resilient, future-oriented and inclusive. Their energy in digital platforms, startups and creative industries could establish Nepal as a hub of innovation. Without systemic reforms, however, their frustration risks spilling over into protests, unrest and continued migration. The September protests were a stark reminder: Nepal’s youth are not just a political force—they are an untapped economic engine whose drive could define the nation’s future.