Many in the the Millennial generation (those born between 1981 and 1996) have become increasingly dismissive and resentful towards the Baby Boom generation (those born between 1946 and 1964). Millennials have struggled against political and economic currents that other generations since the Baby Boomers have not encountered. Beginning with 9/11, followed by the Great Recession, then the student debt crisis caused by the exorbitant cost of college, and now the COVID-19 pandemic and resulting recession have all made it extremely difficult, if not impossible, for Millennials to move forward in their lives, both economically and personally. Secure employment and wages commensurate with their level of education, buying a house, and starting a family seem out of reach for much of the Millennial generation.
They have, indeed, been dealt a bad hand. Statistics bear this out:
- From age 18 to 33, growth in economic output (and therefore income) rose nearly 40% for boomers but less than 20% for Millennials
- During the first decade of their entry into the labor force, the economy grew around 25% for Boomers. For Millenials, the growth rate has been barely above 0%.
- When Boomers reached the median age of 35, their generation collectively owned 21% of the nation’ s wealth. Millennials will reach a median age of 35 in four years. Presently, they own only 3.2% of the nation’s wealth, a gap they cannot make up in just 4 years.
- The wealth gap between the age group 20 to 35 (today’s Millennials) and those aged 52 to 70 (today’s Baby Boomers) has doubled from what it was for the same age groups in 1998.
- Millennials earn 20% less than Baby Boomers at the same stage of life, despite being more educated.
- The percent of Millennials who have only a high school diploma or some college that are living with their parents is double what it was for the same group of Baby Boomers at the same age.
- Between the ages of 25 and 37, about 65% of Baby Boomers were married. At the same age, only 46% of Millennials have married. This is partially due to the poor economic prospects for Millennials.
- Studies show Millennials are enduring a mental health crisis. Depression and deaths of despair are rising for this generation. Many have attributed this to the economic challenges Millennials confront..
Looking at the hurdles they are confronted with, many Millennials place responsibility on the Baby Boomer generation; a generation they see as having been in charge during this period. They see Boomers in secure jobs with pension plans, with houses that have dramatically increased in value, and with government provided Social Security and Medicare; things that many Millennials feel they will never be able to attain. They see Boomers as a selfish generation, who inherited a strong, viable economic system from their parents; who took that inheritance and splurged it on themselves, and then left succeeding generations to struggle on their own. Boomers got theirs and that’s all that matters to them.
Is this an accurate assessment of what happened and why Millennials struggle so?
For a generation who has supposedly benefited at the expense of other generations, many Baby Boomers are actually in pretty bad shape economically:
- The median savings of Baby Boomers for retirement is only $152,000.
- Forty-five percent of Baby Boomers have no retirement savings at all.
- Fifteen percent of Baby Boomers have retirement savings of less than $100,000.
- Many Baby Boomers are planning on delaying retirement and working longer than any generation before them.
- Baby Boomers have more debt than any previous generation at the same age.
- Since 1991, the rate of people 65 and older who file for bankruptcy has tripled.
There is a group of higher income/higher wealth Baby Boomers that have done extra-ordinarily well. That’s why the median wealth of Baby Boomers is $1.2 million. Those figures are skewed by Baby Boomer billionaires like Jeff Bezos, Bill Gates, and other very wealthy boomers who, while not billionaires, have done very well. So despite what the median wealth figure is, many Boomers are struggling. Also, it must be noted that there are some Millennials who have done very well despite the currents against them. There are 18 Millennial billionaires in the United States, 14 of them “self-made” and four from inheritance. So, some Millennials who have been prospering.
Are Millennials right to blame an entire generation for the economic challenges that confront them, or is there something else going on here? This will be the subject of my next post.
