The Abandoned Generation: Creating Jobs and Opportunities for Young Adults

Since the Great Recession began, young people have taken it on the chin—whether they’re carrying a high school diploma or a costly college degree. The jobless rate among young adults is about double that of other age groups—with unemployment rates at Depression-era levels for young African-American and Latino men without college degrees. No previous recession comes close to this one in terms of the loss of jobs and opportunity among young people. Which helps explain why the majority of Americans now believe today’s Millennial generation will be worse off than their parents. American public opinion is simply catching up with reality; the truth is, the downward spiral for this generation was well underway before the Great Recession.

 

Working hard and getting an education have long been tickets to the American Dream, but that is changing. Young people are finding it harder to work their way into the middle class as blue collar jobs and trade apprenticeships disappear, while educating your way up the ladder has also become more daunting amid skyrocketing college tuition costs.

Shrinking Paychecks

Let’s look at what’s happened to young workers’ paychecks over the last generation, starting with the experience of young men. Three years before the recession, the typical earnings for all young men working full-time were down 4 percent compared to 1980. And behind those overall figures are deep drops in earnings for the majority of young men. By 2005, young men with only a high school diploma were making 82 cents for every dollar their father made back in 1980; young men with some college were making only 92 cents. The only men who made progress over a generation were those with at a least a bachelor’s degree. By 2005, they were making $1.16 for every $1.00 their dad had made at that age in 1980. Of course, that extra 16 cents per dollar gets quickly eaten away by the student loan payments and higher housing costs that also distinguish the life of a 20-something Millennial compared to Baby Boomers. What happened to men since the Great Recession is a continuation of these trends against a backdrop of a labor market that is no longer creating enough jobs to go around.

Young women, on the other hand, have made solid gains in the labor market since their moms’ 20-something days in the 1980s. The typical earnings of young women in 2005 were up 29 percent compared to 1980—with young college-educated women seeing the largest increases in their paychecks. Young women with no college education still saw gains, though they were more modest, about 5 percent. It’s not surprising that young women today have surpassed their moms in earning power—they work longer and steadier than back in 1980 and have made significant inroads into higher paying occupations. They also had a lot of catching up to do. That said, the gender gap is alive and well. Young women—at every level of education—still earn less than male counterparts.

Racial Disparities

The worst part of the story about America’s young adults is how many have been completely abandoned by this economy. One in four young black women (18-24) are jobless and one in three young black men in this age group are jobless. The picture improves somewhat for 25-34 year-olds, with 16 percent of young black women unemployed and 19 percent of young black men. Young African Americans who are employed still earn considerably less than young whites—a testament to the unequal educational opportunity and persistent discrimination faced by this post-civil rights generation. Young Latinos earn less on average than either young whites or blacks.These racial disparities suggest an ominous future for the middle class. Most of our population growth over the next several decades will be among Latinos and African Americans -- the very same Americans now being left behind by this economy. To ensure a strong American middle class, our nation must ensure greater opportunities for these young people of color.

What Young Adults Need to Succeed

The President is expected to outline his ideas for job creation and deficit reduction after Labor Day. Addressing the declining living standards experienced by a new generation must be part of the agenda. While today’s Millennials are worse off than their parents were when they were in their 20s and early 30s, there are clear steps the U.S. can take to refuel the engine of opportunity and prosperity for young Americans.

First and foremost, we need to get young people in jobs, and quickly. There are already bills in Congress, including one Representative Jan Schakowsky of Illinois released recently, that would establish a temporary jobs program to get Americans back to work and at the same time meet important national needs. The longer we let 19-year olds or 26-year olds sit idle, the more we risk leaving a significant part of the population completely isolated from society.

During the Great Depression, the government moved decisively to create jobs for young people, most notably with the Civilian Conservation Corps, which employed over 2.5 million young men over nine years who worked to develop and protect America’s natural resources. Beyond enacting a national jobs program, Congress should temporarily expand funding for programs specifically geared toward young people, such as AmeriCorps, the Peace Corps, and the Youth Conservation Corps. In addition, new aid to state governments is desperately needed to prevent further layoffs of public sector workers -- layoffs that have hit the education sector hardest, throwing tens of thousands of young teachers out of work (since the last hired tend to be the first fired).

Second, we need to begin steadily re-investing in America and its people again. It’s no coincidence that -- as state college tuition has more than tripled and our roads and bridges have crumbled—that our middle class has shrunk. Any long-term plan for a future and diverse middle class must include investments in both our physical and social infrastructure too.

We desperately need to transition from an industrial era K-12 public education system to a Zero-14 system that would ensure all children get the developmental start they need to succeed. For too long, the United States has lagged behind every advanced nation in providing child care and early education. The benefits of early education are ample and well documented—there is likely no better investment the nation can make to ensure the future well-being of its people.

At the same time, we also need to rethink the pipeline into and through post-secondary education. Many young people can’t get what good paying jobs are available because they don’t have the skills they need. And too often their efforts to get these skills are thwarted because of the exorbitant cost of higher education. For example, research shows that students who must work their way through college are far more likely to drop out and not complete their degrees (yet still owe student loans). As well, a great many young people aren’t prepared for college at all -- guaranteeing a future of dead end jobs and low earnings. This must change, and there are hosts of good proposals to provide better support to community colleges and their students that would repair America’s broken opportunity ladder. In the longer term, we should consider moving toward a high school education system that provides the equivalent of 2-years post-secondary work—whether it’s vocational or liberal arts—and it must be tightly connected to the needs of the labor market.

Public Investment Pays

The great American middle class didn’t happen by accident, but rather was the direct result of historic public investments. Many of these investments were targeted at younger Americans, particularly veterans, and the result was one of the most productive societies in history. These gains are now at risk, along with the economic security of an entire generation. Worse, austerity policies could ensure a downward spiral as budget cuts and disinvestment deprive young Americans of the jobs and educational opportunities they need to succeed.

America needs to renew its commitment to building a strong middle class. And the best way to start is by investing in its young people.

This post is part of Demos' "America Can Work Better" Week

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