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The Times changed the headline on this piece, but the idea that Millennials are facing our first economic downturn is... absurd. We entered the workforce in a recession, and we've been slower than older generations to recover. Now we're getting hit again. https://www.nytimes.com/2020/04/06/business/millennials-economic-crisis-virus.html
Every time I tweet about this, people chime in to say that the 2008 recession hurt everyone. And it did. But it didn't hurt everyone equally. Older Millennials who were just entering the workforce were hurt the worst: We did not recover, and may never recover.
Millennial-headed households are worth about two-thirds of what Boomer households were worth in the 80s, when Boomers were young adults. Trouble getting jobs & low starting pay compounds on itself, setting Millennials up for a lifetime of being underpaid and underemployed.
Despite being a wealthier nation, Millennials are worth LESS than Boomers were at our age. We make less, too -- so both our incomes and our net worths are lower than theirs were. That really should not be the case in a nation that has grown more prosperous.
Millennials are worth MUCH less than Boomers now. That's to be expected -- older people are always worth more than younger ones. But in 1998, 52-to-70-year-olds were worth about 7 times as much as 20-to-35-year-olds. Today, Boomers are worth TWELVE TIMES as much as Millennials.
The Times piece is correct that young people are in a uniquely precarious position as this downturn hits. But many of us are in that position - with few assets & lots of student debt - in large part because of the LAST recession.
And it's important to emphasize here that a whole lot of this is about race. Millennials are a poorer generation in large part because we are a more racially diverse generation, and the spoils of the American economy have disproportionately gone to white families.
This will be the first recession faced by Gen Z-ers, the oldest of whom are in their very early 20s (the youngest ones are still in elementary school). My hope is that we look at the ripple effects of the last recession on Millennials and shift course. But... seems doubtful.
The Times piece is good, except for the use of "Millennial" as a synonym for "young." Millennials are in their late 20s and mid-30s; the oldest are pushing 40. Just like "Boomer" is not a catch-all for "old," "Millennial" does not mean "young."
One thing that is really under-reported is how the 2008 recession hit younger Millennials. No, it didn't tank their job prospects the way it did for older Millennials. But it did wipe out a lot of their parents -- and their college savings accounts.
Ballooning student debt was a huge problem for older Millennials too (*raises six-figure-in-debt hand*). The recession didn't cause that. But the recession did two important things for younger Millennials:
(1) It entrenched the necessity of college. Not because a degree makes you wealthier, but because when the bottom fell out of the economy, the cost of NOT going to college got much higher. Young people responded. In 2009, 70% of high school seniors were college-bound.
(2) The recession also really hurt the Gen X parents of younger Millennials, often wiping out college funds. That meant that a lot of those college-bound younger Millennials had to take on more debt than they otherwise would have.
And in those same years when Millennials, facing a recession, did what we were supposed to do and pursued higher education? The cost of a college degree increased by nearly 70%. And all those high school seniors who went straight on to college? About 40% of them didn't graduate.
So many of the reasons young people and Millennials are especially vulnerable in this current recession can be traced back to the last one: Crushing debt, a decade of being underpaid, lack of major assets like a house, higher rates of cobbled-together gig work.
