It’s not often that conservatives and libertarians can agree with anything the New York Times publishes. Here, it is a different story.
The New York Times Editorial Board posted an op-ed piece on how 18-24 year olds are, in fact, starting out behind in the world today compared to previous generations.
High unemployment, mountains of student loan debt, and reckless fiscal policies have made achieving the American Dream nearly impossible for Millennials.
The New York Times- Today’s young people, ages 18 to 24, should have been the lucky ones. They were preteens or teenagers when the recession hit in late 2007, with high school and college still ahead. Unlike those who had to enter the work force in the depths of the downturn, they had time, or so it seemed, to wait out the weak economy.
But that’s not how things have worked out. While the worst is over, economic conditions are still subpar, damaging the immediate job prospects and long-term living standards of young adults starting out now.
In recent years, the economy has grown annually at 2 percent or so. That’s too slow to make up the current shortfall of nearly seven million jobs, let alone to absorb new graduates or push up wages in jobs that do exist.
To make matters worse, the economy contracted at an annual rate of 1 percent in the first quarter of 2014. A rebound is expected, but there is little in the economic data or current policy to suggest that an upsurge will be sustained; over all, economic growth is likely to settle at 2 percent to 2.5 percent.
For young people, these conditions will only deepen a long trend of increasing economic hardship. Census data that compares today’s 18-to-24-year-olds with the same age group in 1970 and in 1990 show more poverty among young adults over time, as well as lower income and less independence. But young people today are appreciably worse off than those in previous generations.
In 1970, for example, 13.9 percent of people ages 18 to 24 were in poverty. In 1990, 15.9 percent were poor; in 2012, the last year of available data, 20.4 percent were poor, or 6.1 million people. That data excludes students living in dorms, as well as most students who live with their parents or receive cash support from them. For young people who are on their own, either living alone or with housemates or spouses, median household income, recently $30,604, is nearly $4,600 less than in 1970 and virtually unchanged since 1990, adjusted for inflation.
Lack of opportunity and lack of resources mean a smaller share of young high school and college graduates are relocating, traditionally a way up a career ladder. In 1970, nearly 40 percent of young people had moved in the prior year; in 1990, it was nearly 32 percent; in 2013, it was only 21.6 percent. Not surprisingly, the share of young adults living with their parents is 55.3 percent, compared with 47.3 percent in 1970 and 52.8 percent in 1990.
Young people are clearly banking on a college education to improve their prospects — 41 percent of 18-to-24-year-olds were recently enrolled in college, a higher share than in previous generations. But the unemployment rate of college graduates ages 21 to 24 remains high at an average of 8.5 percent over the past year. Underemployment — which includes those who are officially unemployed, those who want to work but haven’t looked recently for a job and those stuck in part-time jobs — is 16.8 percent.
Equally worrisome, 44 percent of young college graduates in 2012 were working in jobs that didn’t require a college degree (versus 38 percent before the recession in 2007), according to data from researchers at the Federal Reserve. In 2000, half of college-educated workers in jobs that didn’t require a degree were in generally well-paid professions, working as electricians, for example, or dental hygienists. Now they are more likely to be waiters, bartenders or cashiers.
College-educated workers still earn much more than less-educated ones, butlanding a good job at rising pay is made even more difficult as each new group of graduates joins a backlog of unemployed and underemployed college and high school graduates, dating back to the class of 2008.
Over the last six years, one of the economy’s biggest problems has been faulty fiscal policy, with the federal government underestimating the need for economic aid or withholding and reducing help prematurely. Another drag has been lack of business investment, even as financial markets have prospered with the help of loose monetary policy.
The result has been an economy where young people starting out are at risk of prolonged underachievement. It is possible to defuse that risk, but not without responsive policy and robust investment.
Of course not all of what the board wrote is agreed upon by those on the right, but the meta narrative is one that is slowly beginning to come full circle. The past 6 years of crazy deficit spending, tyrannical bureaucracies, and unbearable regulations are putting Millennials at risk. Perhaps the next election cycles will show some of that disdain.