Sunday, January 12, 2014

The Greatness of Youth....

Young people of all countries, unite! Well, perhaps not so much. For millennials (including myself), economic times are TOUGH and sometimes I wonder whether it is us to blame or the broader structural factors. Is it because we expected a career path that resembled our parents? Are we wrong to think that the most prosperous period of American history would repeat itself?

I, for one, always thought finding a fulfilling career would somehow magically appear after I finished college. Looking back, this was an utterly naïve view. I wonder if I had thought more about the difficulties of getting a job after college in high school, whether I would have pursued a different path (gotten a more technical degree).

I don't think millenials are totally off the hook for their difficulties, but I would like to explore the structural piece in more detail (after all this blog is about demography). A large portion of finding a job is structural. Structural factors include the following: we graduated in a recession, the economy has fundamentally changed, workers are much less valued, inequality has risen, consumer spending has fallen, academia is out of touch and OUR GENERATIONS IS HUGE!

Yes, I agree some part of the jobs crisis in our generation is caused by the recession and other structural factors, but another contributing factor that has been overlooked is the UTTER size of our generation. Positions in school, work, government and other institutions are finite. There was a finite number of spots on our high school soccer team, a finite number of seats at Harvard and a finite number of jobs at Goldman Sachs/Walmart/Google. Our generation is the largest generation in American history, bigger than the Baby Boomers. To me, one of the simple reasons it seems that we are having a hard time is because the job market, was and still is, unable to adapt to handle the sheer size of our generation.

But, what does this mean for us millennials. Well, I think the future will look like this - we will be better educated than younger generations that follow us (we're already more educated than older generations), we'll get better objective test scores and we'll have more credentials, but we will still be stuck in worse jobs, get lower income throughout our lives, and have fewer promotions than our counterparts in other generations.

The reason why is somewhat straightforward. Simple supply and demand. A finite number of jobs and more demand for those jobs leads to more competition for everyone and lower wages for the lucky ones who get jobs. A large generation does not have to be a bad thing. If the government planned and facilitated greater job growth to meet the demands of a large generation, it could be a tremendous driver of economic growth to pull us out of this recession. Maybe leading to an even more prosperous period of American history.

The greatest benefit of a large generation is political clout, let's wake up and exercise it!


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