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Millennials Earn 20 Percent Less Than Boomers Did At Same Stage of Life (usatoday.com)
According to a new analysis of Federal Reserve data by the advocacy group Young Invincibles, millennials earn 20 percent less than boomers did at the same stage of life, even though they are better educated. Their median household income is $40,581, and their home ownership rate is lower, while their student debt is drastically higher. USA Today reports: The analysis of the Fed data (PDF) shows the extent of the decline. It compared 25 to 34 year-olds in 2013, the most recent year available, to the same age group in 1989 after adjusting for inflation. Education does help boost incomes. But the median college-educated millennial with student debt is only earning slightly more than a baby boomer without a degree did in 1989. The home ownership rate for this age group dipped to 43 percent from 46 percent in 1989, although the rate has improved for millennials with a college degree relative to boomers. The median net worth of millennials is $10,090, 56 percent less than it was for boomers. Whites still earn dramatically more than Blacks and Latinos, reflecting the legacy of discrimination for jobs, education and housing. Yet compared to white baby boomers, some white millennials appear stuck in a pattern of downward mobility. This group has seen their median income tumble more than 21 percent to $47,688. Median income for black millennials has fallen just 1.4 percent to $27,892. Latino millennials earn nearly 29 percent more than their boomer predecessors to $30,436. The analysis fits into a broader pattern of diminished opportunity. Research last year by economists led by Stanford University's Raj Chetty found that people born in 1950 had a 79 percent chance of making more money than their parents. That figure steadily slipped over the past several decades, such that those born in 1980 had just a 50 percent chance of out-earning their parents. This decline has occurred even though younger Americans are increasingly college-educated. The proportion of 25 to 29 year-olds with a college degree has risen to 35.6 percent in 2015 from 23.2 percent in 1990, a report this month by the Brookings Institution noted.
So, more younger folks have college degrees. Does that actually mean that those folks are better educated? Are a bunch of for-profit institutions just churning out worthless degrees, while saddling young students with debt that they have no chance of paying off?
Schroedinger's Brexit: The UK is both in and out of the EU at the same time!
If you work hard, you will do better than your parents.
davecb@spamcop.net
But the median college-educated millennial with student debt... THAT my friends is the crux of the story! Millennials have been SUCKERED into thinking they HAVE to have a college degree. Most of them, in a field with a POOR track record of job advancement, or jobs at all! Suckers, that's what they are. And who profited from all of this? "Big college" that's who! Apparently economics isn't something they teach you in high school, or, perhaps they would figure out, that a four year teaching degree at a 4 year college, that puts you in 40,50,60 thousand dollars in debt, for a job that pays 30,40 thousand a year, ain't gonna cut it when you factor in your car(s), rent/mortgage, clothes, food and what not.
Damn, I should have known there was a catch!
I'm an American. I love this country and the freedoms that we used to have.
Meanwhile we have a "recovery" that's not actually a recovery but a bubble fueled by low interest rates and the Fed printing more and more money.
The "sharing" economy is crap. It's basically participated in by people who can't find an actual job, so the wages are very low. Apparently these gigs count as jobs anyway for some reason, so unemployment numbers don't look too bad.
Add to that job competition from poor immigrants at the low end of the wage scale, and job competition from severely underpaid H1B workers at the high end of the wage scale, and the average will drop.
The US managed to delay the fiscal crisis which was imminent in 2008 by bailing the banks out with debt, but we didn't actually fix the problems. There's still massive speculation. There is still too much debt. There's still a trade deficit. I think some of us are feeling a little bit euphoric stocks going up again, but it's artificial.
The article is saying the kids whine because they really are getting less income and they have more debt.
Of course they don't mention all the boomers who are now making less than they did when they were younger. Welcome to the precariate - never have so many worked and studied so many hours for so little.
The whining is justified. Two generations without a real increase in income while those at the top get richer will eventually result in more than whining.
"Transparent" is a shit show that trades on every stereotype going. A man in drag is NOT a transsexual.
You can't pay the rent or eat with a free download. And your job is at risk - you not only can be replaced, it's pretty much certain you will be replaced. And with more people competing for jobs where humans haven't yet been replaced, do you really think you're immune? Nobody - not even politicians, judges, lawyers, cops, and soldiers - are immune.
"Transparent" is a shit show that trades on every stereotype going. A man in drag is NOT a transsexual.
I grew up with all of my peers having just one working blue collar parent. I dont know of anyone today at any age group where that is true.
Funny thing about workers in other countries - they kinda don't want to bust their ass for meager wagers so that Americans can enjoy a standard of living higher than they deserve. The inevitable outcome is an equalization of income, where wages in established nations stagnates while wages in developing countries rises.
Two generations without a real increase in income while those at the top get richer will eventually result in more than whining.
That's how we got Trump. If the powers that be don't see that for the warning it is, then they deserve what comes next.
I wish I had a good sig, but all the good ones are copyrighted
Worldwide, millennials are doing great. The World Bank Forecasts Global Poverty to Fall Below 10% for First Time.
The problem for Americans is that we can't exactly ask the Chinese to go back to having 45 million people starve to death in a new "Great Leap Forward", no matter how much taking their labor skills off the capitalist market might improve the labor demand for unskilled white Trump voting high-school dropouts. Globalism is a bitch if you were used to getting a free ride.
Was thinking the same thing. A additional 15% took an extra 4 or 5 years of partying before starting work. Graduate dumber, but better indoctrinated, than when they started.
Not just 'for profits', all schools are offering lots of watered down degrees, not that * studies wasn't already worthless 30 years ago.
It could also be globalism.
Jobs leaving the country create an excess of workers, so the remaining jobs can be offered for lower salaries. It's simple supply and demand.
Is there another economic explanation that could account for the difference between then and now?
Ignoring government numbers because of various controversies in how they are measured, the Gallup Poll survey puts us at 9.2% real unemployment, and less than half of those are rated "good" jobs.
We're supposedly out of the depression, the economy is doing great, and yet people are making 20% less than average from 30 years ago.
What other major economic forces could account for this?
It used to be that college was less than a thousand bucks. What happened? A) Expansion B) Deep cuts in federal and state financial support. Basically, colleges were forced be become more like private entities because of tax cuts. Now the people that forced this behavior are blaming the colleges for doing what was required. The same people are also enjoying a glut of employable people so they decided that they aren't worth as much and thus paying them less.
"Boomers" and "Gen X" are crushing "Millennials" with debt and then turning around and blaming colleges for their own reprehensible behavior.
Anons need not reply. Questions end with a question mark.
I doubt Trump will help.
I suspect it will get worse. Look at his cabinet nominations.
People voted anger, not intelligence.
Dear boys and girl; when I was young a college education was a broad preparation for participation in worldly affairs. One learned languages- Greek, Latin, German, possibly French. One learned geography, history, literature, art, music and philosophy. There was extensive, though informal, focus upon social behavior (which is sorely missed in these days). One might opt for some training in business, accounting, law, medicine, etc if there was a need for earned income.
College education today is job training. And as jobs vary ever more widely and specialties form in ever narrower fields, that training is extremely vertical such that any change in the job market sends you back to square one. Today's programmers, lawyers, doctors and auto mechanics are required to continually update their training as knowledge and technology change. Because machines will adapt to those changes more effectively than humans, there will be fewer opportunities for humans.
There are fields that remain relatively stable and somewhat immune to automation. Management, sales, teaching, the arts, mattress tester... The kind of science we associate with Einstein; imaginative and inspired is a bright possibility. Inventors (real inventors, not the corporate kind) can also take leaps beyond logic. And while computers can compete, ultimately the best work in the arts will be done by humans. Young people might want to explore such areas rather than those of rapid change.
...omphaloskepsis often...
No, it's not "despite being better educated", it is because being better educated. Millennials lost 4-10 years of earnings and earnings growth relative to people who started working right out of highschool. For many college majors, the gain in post-college earnings isn't worth the cost.
The other significant influence is that all the employer mandates, healthcare, insurance, and benefits come out of salaries. Healthcare costs alone likely account for a large chunk of the earnings gap.
The article is saying the kids whine because they really are getting less income and they have more debt.
The issue is they are getting less income for the same amount of work, and having to go vastly deeper into debt just to get the job in the first place.
There is a perception that Millennials are lazier and or less qualified than their predecessors. Having seen the quality of resumes coming in the door, I fully understand that conclusion even though it is incorrect. The reality is that 50 years ago, there were vast numbers of jobs that any idiot could do, and thanks to the new deal and unions, those jobs paid well enough to live on. Today, those jobs pay significantly less than they did, and there are fewer of them. Inflation adjusted, the jobs on the bottom pay 30% less than they did in 1970, and many of them are being lost to automation. Its small wonder no one wants those jobs. So now all Millennials, not just the qualified ones are submitting resumes in the "shotgun blast" approach to job hunting. There are plenty of jobs at the top of the spectrum that pay decent, but all the qualified people are already employed, and much as anyone would like to pretend, you just can't take someone with a 90 IQ and teach them to be a programmer. It just ain't gonna happen. Millennials are not any more or less capable, its just Millennials are the first generation where the inept ones don't exercise any restraint in applying for jobs they are absolutely unqualified for, so now you get buried in resumes from unqualified applicants because the same inept 10,000 are applying for every god-damn job. In the end, the same 10% that was always capable is still out there, just they are no longer a significant fraction of the applicants floating around, the 50% that used to settle for a job as a ditch digger, suddenly find themselves in a world where there are far fewer ditch digging jobs, and the jobs that are available, they don't have a prayer of being able to do.
I wish I had a good sig, but all the good ones are copyrighted
I'll say it's mostly an R thing. There are some folks on the D side like Warren, Alan Greyson and (sorta kinda) Bernie (yeah, I know he's running as an I, but come on, he's so tight with the Ds the whole I thing is just to keep them on their toes). I haven't once seen anyone from the R side raise the issue of income inequality except to say it's either a) not real or b) the fault of anyone making less for not working hard enough. I'm open to being proven wrong, but I literally don't know of any. Maybe John Boehner, but he retired.
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Quality of life is better because you can get entertainment instantly? Wow, talk about pacifying the masses.
Laws are rules for the court, but merely a bottom bar to hit for life. Think beyond laws in your actions always.
Yes, indeed. When I left university, in 1976 with a UK degree in Computer Science (that's what it was called then), I was the first of a breed.
Employment was assured. I worked at Plessey for a few months, on the radar system for SE England (cool), then fled to the continent where I was paid quite astonishing amounts of money. First building a nuclear reactor monitor (even cooler), then a packet switching system for Holland (yup, that's the predecessor to our beloved Internet).
I made so much money [new sports car = 1 months disposable income] that after a few short years - ie when I was 25 - I took my money, bought an ocean going yacht and set off for a pretty decent adventure.
A couple of years later, I decided to stop (in USA), and ended up in Australia, still with enough money to pay for 1/3 of a house. (Houses were about 2-3 years salary at the time, really should have bought several).
So yup, I was definitely richer than today's poor kids, who get to leave university with huge debts, struggle to get an internship (otherwise known as slavery), then maybe, just maybe get a sensible job after a year of unpaid labour.
Then they might try to buy a house, now at 1 million dollars, 10 years salary (if you don't eat). Good luck with that. And have kids - can they afford to breed?
So they might have the internet, mobile phones, and great flat screen TVs, but they sure as heck aren't richer. I was way, way luckier with my timing.
"Cats like plain crisps"
I am continually surprised by those who are not knowledgeable about (or misattribute) the bigger macroeconomic factors that have driven our prosperity. The American economic miracle, the American dream, is largely a by-product of a brand new territory, open for expansion, a growing population whose material needs and wants grew to match the space for it. And where demand for services and goods made by those people exceeded the supply of labor to produce it. Not to mention 2-4 major wars and post-war booms that produced a huge demand for labor and the attendant growth of wages that comes with.
So for 6-7 generations, we came to associate American success with hard work, determination, education -- where I would argue that yes, while these factors have something to do with it, we were just mainly beneficiaries of a great macro situation. Factories, heavy equipment, washing machines, cars, steel -- these were the things we needed as a society that we would pay for, and they were produced here by labor that couldn't be substituted.
Now, we find that our post-war boom is over, the demographic curve has to support an increasing number of people who are no longer in their prime productive years, and a global market for the best / traditional jobs that has sapped the domestic demand for labor physically based in the US.
And so parents look at their kids and ask, "hey, why aren't you out there getting a job and using your skills like we did, after all that college and education?" Well, Dad, I can't get a job the way you did, because people aren't hiring hand over fist just because they need bodies to fill an assembly line because people want to buy washing machines as they move into their newly constructed 3 bedroom house in Levittown.
The harsh truth many are waking up to is that not everything grows forever, and perhaps this is the aftereffect of what happens when a society stabilizes, and other peoples/countries around the world start to experience the growth that we once had (and of course helped by the internet, trade, and information).
One could argue that increased corporate tax rates and regulations have made it more difficult to start new businesses, and increases in health insurance costs (benefit packages are labor costs) thanks to Obamacare have made it more expensive to hire inexperienced workers. The government itself, i.e. The Democrat platform itself, is to blame.
Who knew that when you make it harder to run businesses, fewer people get employed (forcing them into part time work) and the average wage goes down?
You got modded to oblivion, but I think that's an insightful post. It suggests an alternate explanation without rancour.
We need to be able to say "the other side did this" without assigning blame and getting into name calling. I don't care what polarity (left or the right) the position is, so long as it's to our benefit.
Looking at your post, I note that the Democrats did, indeed give us Obamacare, it was widely advertised as being a good thing, and it's widely viewed as being a problem at this point in time.
Some ACA aspects were good - getting everyone insured and eliminating "pre-existing conditions" clauses among them - but the end result was a fiscal runaway that's causing a lot of grief among the people.
I note that Republicans (house *and* senate) have already voted to repeal the ACA without having a replacement on hand, and that will probably mean that we go back to pre-existing conditions, dropping coverage after an accident, and insurance companies charging whatever the hell they want.
Which is not at all a good thing, right or left.
Trump said he wanted to get rid of Obamacare and replace it, but he specifically said he wanted the replacement in place *first*. So now we're left to trust that he will do the right thing when the bill comes to his desk. That'll be a good test of his character. If he dumps Obamacare without a replacement and a lot of people lose insurance because of it, it would be a betrayal of our trust.
We really need to fix healthcare in this country. We're paying 6x as much as other countries, and only getting 3rd world care for it.
It's only wealth retention when it can be converted to other assets. We're heading for another housing bubble bust as boomers try to sell their homes to the next generation who just doesn't have the money to purchase that particular asset, even at zero interest 30 year mortgages. Those assets will start depreciating damn fast over the next 15-20 years.
"Transparent" is a shit show that trades on every stereotype going. A man in drag is NOT a transsexual.
Whether you believe globalization is good or bad, the free movement of capital and work, wages will stagnate or go down (at least in the near to mid term).
In Bill Clinton's Global Challenges speech at Yale is, perhaps, one of the clearest articulations of the goal of achieving an integrated global community characterized by "shared responsibilities, shared benefits, and shared values." If the goal is to "bring economic opportunity to the 50 per cent of the globe's population which lives on $2 a day or less" then that will involve capital flowing from wealthy countries to less-developed countries.
I think the vision is that the money supply would grow fast enough to minimize or eliminate the impact of the capital outflow. Unfortunately, the evidence shows that the bet did not pay off.
I'm not sure why you doubt that PeOTUS will help. It's pretty clear from his public history that he is part of the problem. That isn't unusual. All of the candidates were part of the problem one way or another. We simply choose the least best one.
Necessity is the plea for every infringement of human freedom. It is the argument of tyrants; it is the creed of slaves.
But I don't expect them to back it up with actions. Mainly I don't expect then to end visa abuse. They can't bring back manufacturing. There's too much automation. Bringing it back just means a few dozen engineers...
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Whites still earn dramatically more than Blacks and Latinos, reflecting the legacy of discrimination for jobs, education and housing.
Random reminders of racism, often of dubious intellectual merit, randomly injected into articles not about racism. I don't think it's an evil tinfoil hat conspiracy so much as lefties overcompensating in their horror of the Trump phenomenon and thinking that the proper solution is to start subtly injecting their opinions everywhere, but it's starting to rub me the wrong way. And I'm afraid it'll backfire again, and once again wind up operating in exactly the opposite direction as intended (making racism more acceptable.) So, let's not let this shit slide any more:
1. The discrimination against Blacks did obviously have and still has a profound effect on their socioeconomic status, although it is ostrichlike head in the sand behavior to casually imply that other factors do not exist. In particular, I suspect that many black subcultures, which were indeed originally formed as a direct result of racism, nonetheless will not be found to promote such as academic achievement to the same extent as their white counterparts. This should not be any more controversial to suggest than it is to suggest that Han Chinese, Japanese, and Ashkenazi Jewish subcultures probably tend to promote academic achievement to a greater extent than most white subcultures. This has nothing to do with genetics.
2. The casual accusation that discrimination against Latinos is entirely or primarily responsible for their lower average socioeconomic status is far more contentious. First off, all of the objections from #1 apply here. Additionally, unlike black people, tens of millions of them have only been here for a generation or two, and those ancestors did not arrive on slave ships. Their socioeconomic status is thus quite heavily influenced by how poor they were when they (or their parents, or grandparents) arrived from Latin America, and it is additionally negatively affected by the fact that 11 million of them arrived here illegally, meaning that they face significant employment barriers that are not the result of discrimination, but rather are a result of their conscious decision to break the law[1]. The number of people who do not yet speak English fluently (a minority, to be fair) is also very relevant to the average socioeconomic outcome and the deleterious effects this has on job-hunting is not primarily a result of racism.
There are, of course, some far-left people who will deny both of these latter points and insist any limits or barriers to immigration is inherently racist and so is any insistence on a shared common language as a prerequisite for citizenship (without which the melting pot cannot function and over time the society and nation will inevitably fracture along ethnic lines, as history has repeatedly showed.) If you want to have that debate, sure, let's have that discussion some time. I'm actually for increased legal immigration overall, with a few caveats about things that need to be fixed first.
But cut it out with the snarky attempts at cultural mind control with these one-line assertions. You're not helping. You're simply feeding the right and alt-right narratives of the biased and lying mainstream media and mainstream academia. It's really, really hard to continue pushing back against the alt-right when you keep ensuring that ~30% of what they say is more or less correct.
1. I don't say they're evil people for doing so, just that it's not some kind of big secret that it's going to be harder getting a job if you're not here legally, and the primary responsibility for that outcome must therefore fall on their shoulders.
What other major economic forces could account for this?
That one's easy. 1989/1990 also marks the end of the only large-scale, competing economic system to capitalism: socialism. Before, the stakeholders of capitalism had to prove that the masses benefit from it. This restriction is gone. Unrestricted capitalism benetfis capital, not people.
Quality of life is better because you can get entertainment instantly? Wow, talk about pacifying the masses.
You know I've started having similar thoughts as I've watched our society evolve over the last 3.5 decades. (Disclaimer: I am a seriously hard-core socialist.) It seems like we're heading towards Roman bread and circuses, specifically with talk about basic income. We already have the circuses (there's more cheap/free entertainment than ever, it's really mind-boggling), and now we're demanding bread (basic income).
A lot of people think basic income is a great idea and I think on balance I do too, but what will happen when 90% of people just don't contribute economically? Why bother educating them? That's where we were for most of our history - entrenched aristocracies ruling over the ignorant masses, typically with shocking abuses. How badly you prospered or how badly you suffered was a question of whose vagina you were lucky enough to be born out of.
We should be careful of what we wish for.
Barclay family motto:
Aut agere aut mori.
(Either action or death.)
Two generations without a real increase in income
GenX: So ignored we don't even come up in a rant on a message board.
Part of me wants to think that Trump is purposely setting himself up to fail. Why would he do this? Because if he, with all of his money and influence, can fail, maybe we as a nation will see that money does not, and should not, equal "right", and will finally vote for change.
Of course, then the rational side of me speaks up to remind that this would be the most un-Trump thing ever and that he's going to fail despite his best efforts. We're fucked.
APK quotes people (including myself) without context and should not be trusted. Just thought you should know.
reduced burdens on Milllenials for caring for aging parents if the parents are so rich
Millennials are either the children of Boomers (who had horrifically bad savings rates) or GenX (who got a similar, but not as bad a deal as Millennials). Their parents are not going to be able to financially take care of themselves as you imply here.
I don't see boomers keeping in the money away from their kids to the same degree that the top 1% keep the money away from the lower 99%.
The Boomers do not have money to keep away from their kids. They spent it.
This shouldn't be cast as boomers vs millenials, if society were working properly we would all live to see our children prosper more than we did and not just inside some arbitrary historical border, but for everyone
I can not influence economic policy in Uganda. And since I do not live in Uganda, higher quality of life there does not significantly ameliorate a lower quality of life here.