After graduating into one of the most difficult job markets, the Millennial Generation might be about to suffer another blow to their economic stability.
The Atlantic reported this week that the slowing of the economy only adds to problems under which millennials are suffering. According to the College Board, the average pricetag students graduated from college in 2017 was $26,900 at public institutions and $32,600 for those that graduate from private schools. Those bills came in at the same time they were graduating into the worst job market in 80 years.
Twelve years later, data finally shows a stabilized job market for recent college graduates. For anyone graduating after the 2007 economic crash, jobs were hard to tind. Good paying jobs that help recent graduates pay their student loan bills were even harder. Baby Boomers were forced to stay in the job market longer after losing so much of their retirements in the job market. It created a void after the recession and even now Boomers are staying in their jobs longer.
“With the baby boomers occupying most of the top jobs and much of the housing, Millennials are doing less well than their parents,” The Atlantic cited Credit Suisse (PDF). “We expect only a minority of high achievers and those in high-demand sectors such as technology or finance to effectively overcome the ‘millennial disadvantage.’”
These are two huge factors that could determine how millennials will fare if there is a recession in the coming months. The generation has already spent over ten years struggling to regain their footing more so than older generations.
"As they pitch toward middle age, they are failing to make it to the middle class, and are likely to be the first generation in modern economic history to end up worse off than their parents," The Atlantic reported. "The next downturn might make sure of it, stalling their careers and sucking away their wages right as the Millennials enter their prime earning years."
While things might be looking up, millennials are still making life decisions based on their financial stability. According to the National Association of Realtors, 80 percent of millennials say their high student loans are the reason they can't purchase a home yet. About 52 percent of millennials say that they can't even qualify for a loan because their debt-to-income ratio is out of balance.
Millennials are also delaying marriage because they can't afford to have a wedding or buy a wedding ring. The diamond industry has already indicated that millennials aren't springing for costly rings for engagements. According to CNBC, millennials say that no one should spend over a month's salary on an engagement ring. If millennials can't even afford an engagement ring, a wedding or a home, thinking about having children is even further off in their timeline.
If another economic downturn happens in the coming year, it will disproportionately impact younger people who are dealing with huge amounts of debt. If there are layoffs, generally the lower-level staffers are the ones let go first because payouts are often lower than those who've been with the company longer.
"A downturn that leads to higher unemployment and lower wages will force Millennials to wait even longer to start accumulating wealth, making it far harder for them to accumulate any wealth at all," The Atlantic closed. "And Millennial suffering won’t just hurt Millennials. There is accumulating evidence that the economy is more sclerotic and slower-growing than it might be if the Millennials were able to buy homes, have families, start businesses, and spend like other generations—if the young were not existing just to pump up asset values for the old."
It also noted that as millennials learned in 2007, graduating into a recession is horrific. The only generation that could end up worse than millennials is Generation Z, many of whom are about to graduate from college.
