In a recent Esquire Magazine piece, author Stephen Marche takes a stab at the widening economic gap between the Boomers in power and their children — a mix of Generation Xer’s, Generation Yer’s, and older Millenials. Considering the data from the piece, every generation from the mid-30’s and younger ultimately is affected. This includes the children of current college students and young adults that have yet to enter this world.
While the data expounded by Marche smells of generational warfare, it is important to note that the economic gap between the Boomer generation and their children (and grand-children) did not come about through some grand conspiracy or design. For nearly 40 years, our nation has seen a public policy shift in support of older Americans at the expense of younger generations. So what kind of data is there to support such a claim? Here are some figures from Marche’s piece that may be eye-popping but in some ways not terribly surprising:
-Since 1984 the average net worth of those 35 and under has dropped from $11,521 to $3,662 while the net worth of those 65 and older has risen from $120,457 to $170,494.
-Since 1980 the cost of a four-year college education has risen 128%.
-In the early 1980’s only 3% of college grads had done an internship while in 2006 that number had risen to 84% of college grads having done at least one internship. The best available data suggests that U.S. companies save an average of $2 billion annually from low and unpaid internships today.
-The U.S. Government currently spends an average of $2.40 on the elderly for every one dollar spent on a child.
-College graduates fresh out of school now carry an average debt of $25,250.
-In 2011, student debt surpassed the $1 trillion mark and now outpaces the nation’s overall credit card debt.
These figures appear on their face to be a sign of economic hardship that is not entirely insurmountable. Average student debt is comparable to buying a new car for example. Internships, though low or un-paid do provide valuable work experience and a resume boost. And net worth typically grows as one progresses through his or her career. The unfortunate truth is that America’s youth are facing an economy with fewer job prospects and stagnant wages and salaries (adjusted of course) than their parents and even grand-parents did 40 plus years ago. Only 54% of young adults ages 18 to 24 are currently employed. This is the lowest rate among the young since such figures have been tracked starting 1948. For men ages 25-34, the current labor market is also the worst it has been since employment tracking began according to the Bureau of Labor Statistics.
For many older Americans, the economic predicament now placed upon youth throughout the U.S. means the chickens will soon come home to roost, so to speak. Economic hardships equal social consequences and for many young adults burdened with greater debt, limited job prospects, and stagnant wages, it means asking mom and dad for more and more help. Ironically this means a greater burden put on older generations and the delaying of typical life choices often thought of as the sole domain of youth. Some data to consider:
-Since the “Great Recession” began in December of 2007, 1 in 4 young Americans has moved back in with mom and dad after having lived elsewhere.
-1 in 3 young Americans has put-off marriage bringing the age at which one gets married to the oldest ever recorded at 28.2 years for men and 26.1 years for women.
-1 in 5 young Americans has postponed child-bearing.
While no parent would honestly sell out their children, the U.S. has done just that. As this debate now resides in limited circles, it will become widespread in the years to come. From the youth protesting austerity measures in Europe to uprisings from Tunisia to Syria and Occupy Wall Street gearing up for a robust summer, the generational gap will continue to spark outcry. Unfortunately, the pundits will also begin the partisan spin and drag the dreams of millions through the mud before any solution can be achieved.
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