Published on August 22, 2024, 12:32 am

In recent reports, it’s evident that younger Americans are finding themselves in increasingly precarious financial situations. Renowned economist Professor Peter St. Onge recently discussed the current state of millennials and Gen Z, shedding light on critical issues related to savings, employment prospects, and living standards.

Alarmingly, there is a growing trend among younger Americans to overspend, often dubbed as ‘doom-spending.’ This profligate behavior is rooted in their struggle with low-paying jobs and rising inflation rates which are compounded by exorbitant real estate prices; a harsh reality which makes even basic economic survival painstakingly challenging.

Several twentysomethings reveal they have no sustainable employment and find saving money an insurmountable task. Rather than addressing these socioeconomic pressures head-on, many have adopted a laissez-faire approach— drifting from job to job without strategic planning or long-term career mapping. Some dub this phenomenon as ’embracing chaos,’ suggesting millennials and Gen Z’s acceptance of difficult circumstances.

However, this so-called ‘chaos’ may be better described as despair. A recent report from the National Association of Colleges indicates that the average starting salary for new college graduates is roughly $68,000 per annum. Though this might initially seem promising before adjusting its value due to what some observers are calling ‘Bidenflation,’ it approximates to only $50K in pre-pandemic terms.

Additionally, such a salary comes at the cost of substantial educational loans, often mounting up to approximately 4 1/2 years’ worth of earnings based on the reported average starting wage. Herein lies another major problem facing young Americans – inflated educational expenses coupled with unrealistic career expectations planted by colleges.

Analyzing historical data renders this stark contrast more apparent. In 1970 (after adjusting for inflation), starting salaries averaged around $83K annually while college fees amounted to $1,240 per year – eight times lower than today’s rates. Furthermore, the median house price was about $24K; this equates to 2 1/2 times a graduate’s starting salary, which is vastly different from current house prices drastically outpacing average salaries.

In essence, wages have declined while college costs and homeownership expenses have skyrocketed. Against this backdrop of escalating costs and dwindling income prospects, it’s no wonder that many millennials and Gen Z find themselves ‘embracing chaos’—it seems chaos has indeed enveloped them.

So how can we rectify this troubling trend? The solution suggested by several pundits includes mental health counseling—a notion that merely addresses the symptoms rather than the root causes of pervasive economic issues beleaguering young Americans today.

A more productive approach might involve slashing government expenditures to slow inflationary pressures and promote small business development thereby expanding full-time job opportunities. Lower inflation could also contribute to reducing housing costs, while minimizing government involvement in student loans could recapture a more financially balanced era for education reminiscent of the Baby Boomer epoch.

At present, it appears as if these generations are set up for failure caught in the crossfire of financial inequity, ignorant of the unfolding economic turmoil. This grim reality underpins why understanding these trends is crucial for safeguarding our collective future—from a Christian worldview to ensure trusted news coverage or real news elucidating such critical societal challenges.