In England, at the nationals at any rate, there are sessions aimed at young people, with kits (simple 1/72 aircraft usually) provided by Airfix. I've noticed too that there are a few younger people at regional shows. However, to run a business on the basis of a few younger modellers buying cheap kits is a big ask.
Conversely, it's usually the older, cash rich modeller, returning to the hobby after many years, who drives the trade in complex, expensive kits (Tamiya Corsair £100+). The kit manufacturers don't help. It's seldom the case that you see kits, even very old kits, discounted in the same way that other commodities are discounted after a fair time in the retail spotlight.
There's no easy answer to the issue, any more than there is to factory closures or mortgage defaultings. People make their choices, and bits of mass produced plastic replicating yet another Spitfire or 109 are probably not always top of the list.
As with any hobby, there will be die-hard devotees. Maybe it's you. Maybe it's me. Maybe a year from now we'll decide there are better ways to spend our money and our time.
The issue doesn't just affect traditional shops. A large, seemingly successful Internet shop - Netmerchants- closed down a year or so back with very little notice. Similarly, a national model chain - Modelzone - closed its doors after years of High Street trading last year, this, locally, with the result that a more traditional model shop in the city benefited from the additional trade and seems to be going stronger than ever.
What goes around, comes around.