Are young people better off than their parents? At least when it comes to income, the answer depends on gender.
Today’s young women make $1.17 for every $1 their moms earned back in 1980. Young men, however, are earning 10 cents per hour less than their fathers did 30 years ago, new research shows.
The study, compiled by the non-profit Young Invincibles and the think tank, Demos, looked at wage data for 25- to 34-year-olds in 2010 and compared it to the wages of that same age group in 1980.
What they found is not that startling, given social and economic trends over the last three decades: Young women are faring slightly better than their mothers did at the beginning of their careers, mainly because of advances for women in the workplace.
Meanwhile, young men have fewer opportunities overall, due to the decline of manufacturing, construction and other male-dominated industries.
And young Americans seem to be acutely aware of these trends; young women on average, have a stronger belief than their male peers that they’re faring better than their parents, according to Xavier University’s American Dream index.
“Based on their own responses, women are doing better relative to the previous generation,“ said Gregory Smith, one of the three Xavier University professors who recently created the index. “They feel they have better jobs, better homes and higher social status.“
While that may be true, neither gender is off to a very strong start.
“In a single generation, it has become harder to either work or educate your way into the middle class,“ said Tamara Draut, co-author of “The State of Young America“ report.
Draut cites high unemployment, a slump in the housing market and rapidly rising costs for everything from college tuition to rents to medical coverage and child care, as tough hurdles young people have to overcome to get their independent adult lives started.
Amid those challenges, it makes sense then that today’s 20-somethings are facing a tough choice: Either put off major milestones, like moving out of mom and dad’s place, buying a home and starting a family — or likely accumulate a staggering amount of debt in the process.
College seniors who took out loans to fund their college education owed an average of $25,250 last year, according to the Project on Student Debt. And in 2007 (the most recent data available) adults ages 25 to 34 held average credit card debt of $6,255 — 81 percent higher than that of the same group in 1989.
Even though mortgage rates are at record lows and home prices are the cheapest in eight years, fewer young people are taking advantage of those incentives. Their home ownership rates, after increasing steadily from the 1990s until the early 2000s, have recently decreased.
They’re also waiting longer to get married and have children.
All this volatility is causing young people to question what is perhaps the most basic tenet of the American Dream. About 48 percent of young adults ages 18 to 34 believe their generation will be worse off than their parents, according to the State of Young America poll. Only 22 percent think they’ll fare better, and the rest see no change at all.
And what of the divide between today’s youth and their grandparents? While it’s common for older generations to have more money because they have more time to accumulate it, a separate study by Pew Research showed that the wealth gap between America’s young and old is now at its widest point ever.
Source: Daughters financially better off than mothers, but sons … (http://mobile.chicagotribune.com/p.p?a=rp&postId=1322467&m=b&sessionToken=&postUserId=31)
