Young Adults Will Never Recover From Great Recession

In the most recent (alas, current) recession, almost every income group has been hard hit. Recent college graduates, though, may see the rest of their career negatively affected. In response to this year’s ACS report from the Census Bureau, Harvard economist Richard Freeman declared that the economic and human capital losses are enough that young people have become another “lost generation,” similar to the generation that lost their young adulthood to World War One.

According to the ACS report, twenty-something Americans have been especially ravaged economically by the recession. Associated Press explains: “Employment among young adults 16-29 was 55.3 percent, compared with 67.3 percent in 2000; it’s the lowest since the end of World War II. Young males who lacked a college degree were most likely to lose jobs due to reduced demand for blue-collar jobs in construction.” Likewise, this age-cohort is the most likely to be living in poverty.

There are lots of reasons why young adults are bearing the brunt of the economic downturn.

First off, there’s been a steep decline in construction jobs, meaning that young adults (especially men) without college degrees are much less likely to find a job. For those that did graduate from college, student loan debt has been exploding over the past decade. Over 2/3 of students take on debt to finish college, with the average among those students being $24,000. In order to service that debt, twenty-somethings need well-paying jobs shortly after college. Anything short of this means that young adults are forced to choose between paying off onerous debts and living in poverty. Meanwhile, it’s becoming harder for recent grads to find employment, as more experienced workers who have been laid off are competing for the same jobs.

It turns out, though, that even if the economy magically started working again tomorrow morning that the recession would have a lingering malignant impact on young adults. Since most firms aren’t hiring many new entry-level positions, recent graduates seeking to start off their career on the right foot have been forced to take stop-gap jobs unrelated to their prospective career path. This means that when the economy does (fingers crossed!) pick up again, these young adults will not only be competing amongst themselves, but against more recent college graduates as well for entry-level jobs. This is expected to depress employment potential and wages for years to come; when quantified, it’s like losing $100,000 each (inflation adjusted) over the course of their lifetimes, even when compared with other age groups that have been hard hit by the recession.

It’s really this last point that is turning American youth into a lost generation. Though every age group is having to make serious sacrifices, Freeman says that only the youth are going to be permanently “scarred” by it. As a recent college grad myself, this analysis hits a bit close to home. I know a lot of people who had to spend weeks and months looking for non-paying internships just so that they could get some experience on their resume. Many of them had outstanding student loan debt and saw their savings disappear within months. It’s all too real that my entire generation will have this lost income hanging over us for the rest of our working careers.

Hearkening back to the first lost generation, famed theater company the Elevator Repair Service has recently opened a new play based on the quintessential novel about the first lost generation, Ernest Hemingway’s The Sun Also Rises. The New York Times says that the play “exists in what appears to be a state of perpetual and severe intoxication,” not surprising given the source text. It’s ironic that the first lost generation was known for drinking heavily at bars; this one can’t even afford the cover charge.

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Graduate School Enrollment Down For First Time in 7 Years

Women Are 40 Percent of Workforce, But Just 1 Percent of Wealth

Photo credit: Fibonacci Blue's Flickr stream.

55 comments

Ernest Roth
Ernest R4 years ago

@ Jayna W. “Until we bring manufacturing and jobs back home and return the illegal workers” Good. Will the rest of the US ever figure that out ? Many care2 posters haven’t.

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Bryna Pizzo
Bryna Pizzo4 years ago

The President needs to channel Roosevelt and create a new WPA to rebuild the infrastructure and shift the nation to clean energy.

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Randy Robertson
Randy Robertson4 years ago

We have all been sucked into a Pyramid Scheme that cannot support itself and the collapse is imminent. The Greed on top is getting overbearing. With all the funny money floating around, when the Financial System collapses, the whole Social Structure of society will be right on it's heels. We got a taste of it with bail-outs that the ones on top pocketed as bonuses. The only redeeming feature is the higher the Pyramid gets, the farther the ones on top will fall. The ones that are on the bottom that know the barter system and how to unplug a pipe,or have real seeds (Non-Monsanto!) that can reproduce will pick up the pieces...the ones that survive, that is!

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Sue T.
Susan T6 years ago

I think all of us in this country have been spoiled by a mentality of I want this now and I am gonna give my kids everything ....

We all can't be Brad Pitt's kids....it is going back to the basics. When I grew up we had 1 TV, 1 phone, 1 car, no central air, 1 bathroom for 6 people, I wore hand-me-downs, I did not eat fast food, drink soda, had no video games or call phone apps.

OMG we played baseball otside or tag or read an actual BOOK from the LIBRARY,

maybe these young ADULTS need to put their big girl panties or jock straps on and grow up. I had to, why should they be any different?

seriously. cry me a river....when I was 21 I did not own a damn thing .... can you imagine no TV! no video games...wow what did I do? the horror lol...this is your reality deal with it & stop bitching.

GO forth & come up with new ideas that SOLVE problems instead of whining about how bad you have it.

Better yet move someplace where people are really HURTING....Sudan, Somalia, oh no wait I need to go to Spring Break!!!! whatever

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Ernest R.
Ernest R6 years ago

@ Steve R “There is no coming back from this. The only thing that can happen is a total and complete collapse of EVERYTHING we now know,” I fear that you are right. The fantasies of “getting back on track”, “bigger and better than ever” and “recovery in ten years” are not going to help. Jobs won’t return. Corporations are replacing them with technology, and there will be little need for even that with the inability of the masses to afford anything. I write this with sadness and regret. Fasten seat belts everybody.

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the Other RobertO
Robert O6 years ago

Last night on NPR they were commenting on new research showing the "Great Recession" was actually worse than anybody in charge seemed to realize or be willing to admit to. Hello? Can we now officially rename it The Second Great Depression?

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the Other RobertO
Robert O6 years ago

Last night on NPR they were commenting on new research showing the "Great Recession" was actually worse than anybody in charge seemed to realize or be willing to admit to. Hello? Can we now officially rename it The Second Great Depression?

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Will Rogers
Will R6 years ago

When the poor and the working classes (including the so called middle classes who work like dogs for their bosses) complained about their lack of money, no one listened, no one called that a recession. They only call it that when the very rich are affected, and I don't care! Why should I? Really! Why should I? No matter what they say I am always in the same position. It's always been a recession for me. So the banks may go bust. Big deal! The stocks are falling! I don't care! The bankers and the politicians went to the same schools and are in each others pockets and they are to blame, not me! And also another root of their economic tree, the 'Estate agents' (Realtors) who inflated property prices for their own profit and have so far got away unscathed.

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june t.
june t6 years ago

corporations don't care, and they call the shots

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Glenn M.
Glenn Meyer6 years ago

The Kiplinger Letter, Vol.88, No.32 for August 12, 2011, a business newsletter, stated that:

* * *
Listless U.S. and European demand means emerging economies sell less, too. For instance, Chinese factory output contracted in July for the first time in a year.
Because emerging economies are increasingly the engine of global gains (since 2008 laid low the world’s richer nations), that’s an especially worrisome trend. Developing countries will provide about two-fifths of the upward impetus in 2011. In contrast, that group accounted for just one-fifth of world growth a generation ago.
* * *

This is an admission of a decrease in demand in this country due to the out-sourcing of U.S. jobs and the loss in income for U.S. citizens. It is also, maybe, the beginnings of realization that the out-sourcing and off-shoring of U.S. jobs could actually come back to haunt businesses in the U.S. It is one thing to do business with international partners. It is another thing to GIVE AWAY the technology, financing, and infrastructure and to finance the competition for a communist country that has stated it would destroy us through our own greed. We have given away our own market strength of personal middle class income to create a sluggish economy for those businesses remaining in the U.S.

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