A new study by a national advocacy group has compared millennials and baby boomers, and the results are not pretty. A recent study by Young Invincibles paralleled 25-to 34-year olds in 2013 to their contemporaries living apparently much more comfortably at the same age in 1989. The collected facts reflect the extent of the economic decline, even after adjusting for inflation, between millennials and baby boomers.
The Struggle is Real
Boomers may gripe about how they had it harder than the current 20- to 30-somethings, but the numbers show that isn’t the case. Despite being better educated, millennials struggle with higher debt over longer periods of time while making nearly the same as their baby boomer parents did 25 years ago.
With a median household income of $40,581, millennials, meaning those people born between 1982-2004, earn 20 percent less than baby boomers did at the same stage of life, according to recent data gathered.
Middle class is shrinking, with 60 percent in 1971, prime baby boomer age, compared to 50 percent in 2015. Millennials have a median net worth of a little more than $10,000, which is more than 50 percent less than it was for those born from 1946 to 1964.
The Brookings Institute found that those with college degrees in the 25 to 29 age range rose to 35.6 percent in 2015, up from 23.2 percent in 1990. Yet, the college degree that millennials are more apt to get carries less weight and is apparently a much heavier burden.
Millennials pay nearly 150 percent more in tuition, according to Goldman Sachs. Align that with higher room and board, food and many other costs, millennials are shelling out dough and digging a deeper hole than baby boomers had to, in their respective time.
A high school degree was enough for a start in a promising career for 77 percent of baby boomers, while a college degree is now required for most millennials to get their foot in the door of more than a fast food joint, also according to Goldman Sachs.
Why Millennials’ Struggle Matters
The declining purchasing power of the minimum wage is a factor in the millennials’ economic slump. It is not just the age gap, but an economic gap that is making it more difficult for millennials than boomers. But it may not be all bad. Focus, not profit, tends to drive millennials. At least according to a 2016 Deloitte Resources Study. They react strongly to leadership and value passion and decisiveness over watching the clock from their cubicle.
Baby boomers may have been working harder than their parents, and they were indeed, but for the same pay. Millennials are actually working harder for the relatively same pay as both generations comparatively. A Pew Research Center 2014 study found that, after adjusting for inflation, the average hourly wage earner today has the same purchase power they would have had back in 1979.
Millennials are not buying homes at the same rate as former generations, but they are not squandering their pay either. They tend to save pennies by bunking with family members, a record 36 percent rise since the mid-20th century, according to the Pew Research Center.
What to Expect From Now On
Millennials are the most adapted at handling change. After all, they were the first generation to experience hands-on the Internet’s disruption of the way the world around them worked. They are a highly-educated generation, more so than their parents and are punctual, conscientious and tend to pay attention more than boomers, the Deloitte study found. Talk of a raise in the federal minimum wage as well as an expansion of the earned income tax credit could make the future brighter for millennials. And they are people who deserve this, no doubt.
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