Jobs and the Future of Work

Millennials have it worse than any other generation, study says

Nils Westerlund of Sweden, Sofia Braendstroem of Sweden, Alessandro Contini of Italy  and Emma Rose of Britain (R-L) of the HowDo start-up attend a production meeting at their office at the Wostel co-working space in Berlin March 18, 2013. Europe must urgently tackle youth unemployment, the French, German and Italian governments said May 28, 2013, urging action to rescue an entire generation who fear they will not find jobs. Some 7.5 million Europeans aged 15-24 are neither in employment nor in education or training, according to EU data. Youth unemployment in the EU stood at 23.6 percent in January, more than twice as high as the adult rate. Picture taken March 18, 2013. REUTERS/Thomas Peter

Intergenerational inequality is rising in Western economies. Image: REUTERS/Thomas Peter

Joe Myers
Writer, Forum Agenda
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Inequality is rising between generations in Western economies, according to an investigation by the Guardian newspaper.

Millennials. those born between 1980 and the mid-90s, are earning significantly less than the national average, the investigation found using data from the LIS (Luxembourg Income Study): Cross-National Data Center.

“The situation is tough for young people. They were hit hard by the Great Recession, and their labour market situation has improved only little since,” Angel Gurría, Secretary-General of the OECD, told the Guardian.

Source: The Guardian

What does the data tell us?

The report highlights several key trends. Central among these is that prosperity has plummeted for young adults in the rich world.

This is largely a result of the real wage losses seen in Western countries, with the exception of Australia. For people in their early twenties, this equates to average disposable incomes some 20% lower than national averages.

Conversely, the disposable income available to pensioners has risen, most dramatically in the UK. In the US, under-30s are now less well off than retired people.

Why is this?

Rising house prices, unemployment and debt have all combined to hit millennials and their earnings.

The impact of these factors varies across countries. For example, in the UK and Australia, house prices are forcing young people out of the housing market. In the US, debt is holding millennials back – total student debt hit $1.2 trillion at the end of 2015.

The financial crisis in Europe has damaged job opportunities across the continent, with many young people forced to continue to live with their parents into their thirties. This will have a knock-on effect on birth rates and demographics.

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Jobs and the Future of WorkEconomic Growth
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