Every generation likes to complain about how hard they had it when they were young. The economy was always terrible; school was always expensive; snow fell all year round, and everyone had to hike to their second jobs barefoot, both ways. However, PayScale’s latest report, Gen Y on the Job, shows that the youngest generation of workers might actually have bragging rights — the kind you don’t want — when it comes to coping with the most career challenges.
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While only 5 percent of Baby Boomers had to move home after starting their careers, and only 10 percent of Gen Xers did the same, a whopping 24 percent of Millennials have to live with their parents as adults. So why do some many Millennials live at home? Don’t believe the hype: it’s not because they’re too lazy to find a place to live or get a real job.
In short, Gen Y is dealing with the fallout from several years of recession and a soft post-recession economy, plus a changing professional landscape.
A Degree Is Not a Guarantee
While Baby Boomers and even Gen Xers could earn a bachelor’s degree and be reasonably assured of a good job, a degree from a four-year school is simply the price of entry into the job market now — and even with that degree, there’s no guarantee that their investment will pay off in the form of a career path.
Millennials graduated with more student loan debt than any previous generation, and entered a workforce that offered more low-paying retail and food service jobs than professional opportunities. As recently as 2011, 53.6 percent of college grads aged 25 or younger were unemployed or underemployed, according to Forbes, while last year, half of college grads worked at jobs that didn’t require a college degree.
It makes sense that a Gen Y worker with a college degree who isn’t able to parlay their education into a professional job in their field is more likely to wind up living at home. For example, PayScale’s research showed that 51 percent of food and beverage servers born in or after 1982 lived with their parents at some point after beginning their careers.
A Tough Economy for a New Worker
According to a recent report from the president’s Council of Economic Advisers, Millennials still have the highest unemployment rate of any age-based demographic. In 2010, the unemployment rate peaked for workers aged 18 to 34, at 13 percent; in September, 2014, their unemployment rate was 8.6 percent. Education made a difference — in 2013, workers aged 25 to 34 with a college degree had an unemployment rate of 3.7 percent, compared to a 13.5 percent unemployment rate for the same age group with less than a high school diploma — but regardless of education level, younger workers recovered at a similar rate.
“Younger workers have less experience and more tenuous connections to employers than older workers, so they are often laid off in greater numbers and have to compete against more experienced workers for new jobs once recovery begins,” the report’s authors write. “They therefore tend to be among the last groups to recover fully from a recession.”
Finally, wages have stagnated for all workers. The PayScale Index, which measures the change in wages of employed American workers, forecasts only a 0.3 percent increase in wages for the fourth quarter of 2014. Real wages, or the measure of earnings’ buying power when measure against inflation, are down 8.7 percent, compared to 2006 numbers.
What’s the Good News?
While Millennials face unique challenges in the workforce, they also bring a whole new set of skills, aptitudes, and imagination to the table. Gen Y doesn’t dwell much on perks they’ve never experienced or job security that doesn’t exist anymore. They’re comfortable with new technology, able to adapt to changing times, and entrepreneurial. (In fact, they’re 1.76 times more likely to study entrepreneurship in college than previous generations.)
In short, they’re on the move. If the work world won’t give younger workers a defined career track, they’re likely to make their own. Eventually, this determination and creativity — hopefully, combined with improving economy — will allow Gen Y to escape Mom and Dad’s house for good.
Tell Us What You Think
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