Article: American Dream Fades for Generation Y Professionals

[photoguy]

Do young dreamers agree with the article? I feel that my generation (X) hasn't had it as good as the baby boomers, but I don't think we're struggling as much as Gen Y. It's my perception that things seem particularly bleak for them due to soaring education costs and increased competition for the fewer available good paying jobs.

I don't think it's just your perception. Education costs and job availability can be quantified and there's no doubt in my mind that Gen Y has it tougher than gen X. Education costs have been rising faster than inflation for a long time and the job situation is dismal. Just imagine the difference in opportunity for a recent grad compared to a student seeking work during the internet boom.

UC school tuition is something like 12k now but 20 years ago it was only about 4-5k (inflation adjusted). For someone without significant family resources, this is a very large burden.

There is definitely still opportunity and of course the determined/lucky will succeed. But I think if one looks at the overall environment, gen y is facing significantly greater headwinds.

 

[haha]

I don't think it's just your perception. Education costs and job availability can be quantified and there's no doubt in my mind that Gen Y has it tougher than gen X. Education costs have been rising faster than inflation for a long time and the job situation is dismal. Just imagine the difference in opportunity for a recent grad compared to a student seeking work during the internet boom.

UC school tuition is something like 12k now but 20 years ago it was only about 4-5k (inflation adjusted). For someone without significant family resources, this is a very large burden.
There is definitely still opportunity and of course the determined/lucky will succeed. But I think if one looks at the overall environment, gen y is facing significantly greater headwinds.

No doubt about it. But people love to say “I and the people I know are all doing fine”. Well duh, one meets these friends and acquaintances at work or in school or in their children's schools. People here are very money oriented, many are engineers or military or other well paying callings that happen to be in good demand, partly because of the defense industry and our wars. Not so strangely, these people and their friends are doing well. Not to mention that not many people who are struggling are even here writing about their lives.

But watch political trends, watch data about unemployment and underemployment among the young- it is significantly more difficult for them than it has been in the US since the Great Depression. And there is no obvious answer on the horizon either. If Bernanke were going to get the economy going I think it would have at least begun by now, but it is not happening.

We ended the depression last time by having a nice big war that needed lots of cannon fodder. Helps unemployment figures a lot if you draft huge numbers of young men and then get a good number of them killed. We cannot even turn to this now. I have no doubt there will be wars, maybe not directly involving us, but look for drones and robots and small elite forces if we do continue getting involved in wars around the world. So do not expect much help with unemployment from this quarter.

I don't decide that young people are all doing fine by looking at my kids and their friends. They aren't working as bartenders or baristas, and they aren't drawing unemployment-but plenty of young people are. It isn't satisfied workers and citizens who produced the Occupy Movements, that are only quiescent because it is winter and cold outside.

Almost 10 years ago I wrote on this board that I did not think that a populous, militaristic, diverse nation spanning a continent and having the world's reserve currency could possibly thrive with very small employment in manufacturing. I still think this is true. We can't all be doctors and lawyers and attorneys, and it's a good thing because someone needs to produce tradable goods.

Ha

 

[brewer12345]

Ha, I have to wonder: the manufacturing sector looks to me to be going to through the same changes the ag sector went through decades ago. Increasing production with ever shrinking workforce, ultimately resulting in a sector that has small employment and massive output. What does a post-industrial society look like? We were told years ago that we would have flying cars, robot butlers and lots of leisure time in prosperity. Perhaps it simply means that a lot of people end up underemployed or on the dole.

 

[BLS53]

Maybe increased automation will mean there is no alternative other than wealth redistribution. Either that or a wealthy class living in seclusion, while barbarians roam the streets.

 

[Nords]

Do young dreamers agree with the article? I feel that my generation (X) hasn't had it as good as the baby boomers, but I don't think we're struggling as much as Gen Y.

I'm no young dreamer, but I think this is a typical article full of statistical cherry-picked data mining-- with a personal anecdote or two thrown in to support their pre-determined bias, and written on deadline.

Next week we'll read another article that talks about how good Gen X has it, but they're all a bunch of slacker entitled whiners who don't appreciate their opportunities.

Then we'll read one about how the enlightened Gen X & Gen Y are going to revolutionize the workforce with enhanced tech, telecommuting, and true work-life balance... just as soon as they can clear those deadwood Boomers out of the corner offices where they've barricaded themselves.

And the week after that we'll read articles that explain how (1) the Boomers won't be able to retire until they're 82 years old, and (2) the Boomers have ruined it for every following generation.

Did I miss a topic?

 

[FUEGO]

Ha, I see what you are saying about a self-selected group of posters here that have a certain orientation, and that we also all tend to have friends of a certain self selected type.

I felt like reminiscing a bit and looked over my ~200 facebook friends to see if I could find these Gen Y victims of circumstance that were having a rough go at it. My earlier assumptions were basically confirmed - not a whole lot of tales of sadness.

The best I could do was find around 8 people who can best be described as "aspiring artists" (a dancer/actress, a movie producer, a number of painters, jewelry maker/crafter, a photographer). Excepting one, they all have jobs that pay enough for them to get by (2 work at fresh market or whole foods or something, 1 is a barista / cupcake sales professional, others have similar low paid service employment). 2 of those aspiring artists will probably make a living at their art at some point, the others don't appear to be on that trajectory. They all do what they want and seem to live comfortably, although who wouldn't want a cushier job with more money?

The only guy I know (among my self selected FB "friends") that has hit hard times was a guy that barely finished high school, never went to college, did a few years at a max security state prison for cocaine trafficking and distribution, and since serving his debt to society he has had a hard time finding good stable employment (wonder why?). Last time I saw him he had just lost his job as a temp laborer at a landscaping nursery, his 20 year old minivan was barely running, and he was grabbing a bite at Taco Bell with his family on the way to dropping his wife off at her housekeeping job at a local hotel. The guy's life is going to be full of hard times regardless of the economy.

I know 1 person that works in a "factory". He makes $20/hr plus time and a half overtime working the night shift at a medical products specialty printing/labeling/warehousing gig. Not bad for no college education.

But that's not to say the other people I know aren't involved in the production of physical things. IP attorneys, infrastructure engineers, programmers, MD's or phds working in pharmaceutical research, nuke plant engineer, computer chip designer, industrial power equipment logistics engineer. Many of the rest are providing services (mostly medical, educational, or legal). I don't think anyone I know is wishing we could have some magical manufacturing renaissance where they could work 12 hour shifts operating a machine in an uncomfortable factory environment instead of whatever they are doing right now. Except maybe that guy that's an ex-con and can't keep a job.

 

[haha]

Ha, I have to wonder: the manufacturing sector looks to me to be going to through the same changes the ag sector went through decades ago. Increasing production with ever shrinking workforce, ultimately resulting in a sector that has small employment and massive output. What does a post-industrial society look like? We were told years ago that we would have flying cars, robot butlers and lots of leisure time in prosperity. Perhaps it simply means that a lot of people end up underemployed or on the dole.

Very good observation Brewer. That is what I am afraid of.

I have no idea how this will turn out, but there is going to be meaningful political unrest, and how it will shake out is obscure to me. I wonder if there is any country with a big group that is on the dole, who will never really work productively, and who will not see the dissolution of their families, and the dole payments basically used to give a steady floor to whatever they can make from crime?

This is also going to require very high taxation of those who can produce, which may not work economically even if it is accepted politically. Or perhaps higher corporate taxes, but then we are disadvantaged in world trade, which is also hypercompetitive. I think there is no guarantee that there is in fact a solution. In Saturday's WSJ Mr. Abe was complaining that Japan needs to see the yen depreciate against other world currencies, and therefore than the US and the Euro block should be prevented from trying to get their currencies down. Say what? I believe that the last time we heard this kind of talk was in the 30s.

Evolution did not design people to lie around and feel like failures.

Ha

 

[FUEGO]

Maybe increased automation will mean there is no alternative other than wealth redistribution. Either that or a wealthy class living in seclusion, while barbarians roam the streets.

What if a lot more of us get education and then get jobs learning how to build better machines, or design software to better manage these machines, or learn how to better manage the maintainers of these machines, or reduce the inputs required to operate and maintain these machines, or...

 

[growing_older]

I have to wonder: the manufacturing sector looks to me to be going to through the same changes the ag sector went through decades ago. Increasing production with ever shrinking workforce, ultimately resulting in a sector that has small employment and massive output. What does a post-industrial society look like?

This idea that increased efficiency and automation would improve quality of life and allow people to work ever shorter hours and enjoy equivalent or improved quality of life has been around for 50 years. Each step up in productivity surprisingly doesn't end in more leisure, but in people striving for ever higher standards of living. Houses are larger than ever, electronics and home appliances are more capable than ever, yet we always seem to want more than we had before. If there really is a post-manufacturing economy developing (automated production delivers unlimited goods at ever lower prices and labor required) there is likely to be similar adjustment. But what isn't clear is what all the people will do for paid work to buy these things.

 

[Lazarus]

I think a shorter work week would go a long way to reducing unemployment. Too many employers are working the employes they have 60 hours a week. They could have had two doing 30 and both would have had a better life. Maybe a little less money for one but a lot more than 0 for the other.

 

[Amethyst]

Nords's description of the "what it's like out there" article cycle reminds me of the way women's magazines have been structured since before I was old enough to read: "Decadent chocolate dessert recipes...How to lose 5 pounds in one week....How to make yourself look desirable to some guy...The virtues of not tying yourself down to some guy...."

There are only so many topics, and an awful lot of competing periodicals and blogs. No wonder every topic gets recycled.

Amethyst

I
And the week after that we'll read articles that explain how (1) the Boomers won't be able to retire until they're 82 years old, and (2) the Boomers have ruined it for every following generation.

Did I miss a topic?

 

[BLS53]

What if a lot more of us get education and then get jobs learning how to build better machines, or design software to better manage these machines, or learn how to better manage the maintainers of these machines, or reduce the inputs required to operate and maintain these machines, or...

All well and good if everyone had the aptitude for technical fields. Generally one's future in careers as you describe, is determined early on, by their performance in Introductory Algebra. The majority of the population can't cut it academically in math and science based careers. If they could, everyone would be a doctor or engineer. This has always been true, and it isn't going to change now because of an evolving workplace.

It's equivalent to saying we could have more NFL teams, if everyone would just try harder playing high school football.

 

[haha]

This entire thread is strange. Unemployment stats are what they are, people's variously motivated anecdotal testimony doesn't really affect that, though we seem to want to believe that it does. Now if you believe that employment statistics are being manipulated to make them look worse,.... Why?


Ha

 

[marko]

I don't know. I came of age in the early 1970's, and I never recall a time when we had enough jobs for the entire working age population. The difference back then is most of us would settle for whatever career we could get into, and we made that decision by age 25, and got on with our lives.

The difference I see today with Gen Y, is they've been told they were winners all of their life, and now they won't settle for anything less than a high end position in some glamorous field, of which they have a miniscule chance of obtaining. They keep the dream alive well into their 30's, often living at home, with full parental financial and moral support. There comes a time when you have to accept you're ordinary, and go about your life accordingly, without seeing yourself as a victim.

I tend to agree.
Back when I hit the workforce (1971) I was already being told to 'forget about the American Dream', that SS only had 10 years to go (1981?!!), that the middle class was dead and that we should expect less from the world.
The more things change, the more they stay the same.

Have said that, I have encountered several people who are telling me that their employers would be putting them on "less than 40 hours" in order to get around "coming regulations".

Turn it around, and you can see a world where everyone works part time, has good HC and spends their free time in caffe's sipping cappucinos. Maybe less is more.

 

[NW-Bound]

Turn it around, and you can see a world where everyone works part time, has good HC and spends their free time in caffe's sipping cappucinos. Maybe less is more.

Fine with me, as long as I am not the ones who have to change diapers of the geezers in nursing homes, or the ones who pick the coffee bean, either off the plants or the civet droppings.

 

[azphx1972]

Very interesting insights, all. I'd like to hear more perspective from the GenY crowd that are on this board.

When you got out of school, did you feel like the world was your oyster, or did you feel like the chips were stacked against you? How did your parents raise you? Did they coddle you and encourage you to pursue your dreams, or did they try to expose you to the real world and steer you into more traditionally lucrative career choices? Is this really just an entitlement/unrealistic expectations issue?

 

[ls99]

Perhaps Gen X and Y need to eperience chainsaw AL's nurturing management style. Real name Albert J Dunlap.

He pretty well wrecked Sunbeam as a "savior" CEO. Then the board of directors fired him. A bit late and 200 mil or so in the hole.

 

[soupcxan]

I'm GenY and there was a definite adjustment when I started working. I'm probably still adjusting.

My frustration is not with working hard - it's with having to work hard due to dumb/inefficient internal policies/procedures (e.g. things that are in the company's control and could be changed if management wanted to).

After several years working, I no longer see the point in wearing a suit & tie if all I am going to do is sit in my cube and do email/powerpoint/excel. Sure, if someone is meeting with customers or a VP, put a suit on. But the rest of the time, I don't get it.

 

[REWahoo]

My frustration is not with working hard - it's with having to work hard due to dumb/inefficient internal policies/procedures (e.g. things that are in the company's control and could be changed if management wanted to).

What you describe spans every generation since Adam.

 

[samclem]

I think a shorter work week would go a long way to reducing unemployment. Too many employers are working the employes they have 60 hours a week. They could have had two doing 30 and both would have had a better life. Maybe a little less money for one but a lot more than 0 for the other.

Both workers and companies could structure things this way anytime they wanted, but they haven't. Workers apparently want the money, and companies prefer to have fewer workers each working more hours. Some of this might change under the new health care law and the continuing reduction of DB retirement plans.

 

[NW-Bound]

... having to work hard due to dumb/inefficient internal policies/procedures (e.g. things that are in the company's control and could be changed if management wanted to).

A megacorp where I worked had some procedures/rituals so stupid, such that I thought that either upper management hated the workers and designed the hassle to cause the latter to quit without having to fire them, or it was part of a hazing like at college fraternities before an employee was accepted.

Good thing it is all in the past for me. But I still remember fondly my first workplace. All to the top, the management was all engineering type whose goal was simply to build the best product for our customers. We had no time for all this BS empty slogans that permeates today's megacorps. Back then, I read about how Communist China had their workers spending so much time discussing methods to improve productivity that they had no time left to actually work. Some American megacorps are doing exactly that now, while the Chinese seem to be more like Americans used to be.

 

[grasshopper]

Perhaps Gen X and Y need to eperience chainsaw AL's nurturing management style. Real name Albert J Dunlap.

He pretty well wrecked Sunbeam as a "savior" CEO. Then the board of directors fired him. A bit late and 200 mil or so in the hole.

Ms G worked for Al in Laurel MS. He begged (her words) to go to Florida with him, they didn't call him Chain-saw Al because he carved totem poles. We went elsewhere.

 

[FUEGO]

This idea that increased efficiency and automation would improve quality of life and allow people to work ever shorter hours and enjoy equivalent or improved quality of life has been around for 50 years. Each step up in productivity surprisingly doesn't end in more leisure, but in people striving for ever higher standards of living. Houses are larger than ever, electronics and home appliances are more capable than ever, yet we always seem to want more than we had before. If there really is a post-manufacturing economy developing (automated production delivers unlimited goods at ever lower prices and labor required) there is likely to be similar adjustment. But what isn't clear is what all the people will do for paid work to buy these things.

Productivity gains and related real wage growth over the last 50 years means today's worker could live like one lived 50 years ago, and save the surplus wages to fund their early retirement. Not exactly an easy way to reduce the hours worked each week, but it can allow one to retire earlier today than a worker 50 years ago could. In other words reduce the years working and have more leisure years not working.

I think most of today's workers tend to spend the large majority of their wages, and hence aren't able to retire significantly earlier than workers 50 years ago. Productivity growth has led to cheaper prices for many goods but this has also led to more consumption (house sizes, cars, consumer electronics).

It is a little strange that part time employment hasn't become more popular, but I guess for employers they prefer workers to work 40+ hours instead of twice as many employees working ~20 hours. Overhead costs like benefits, office space, IT, compliance, training, payroll, performance reviews etc mean there are large fixed costs per employee that probably make the economics of part time employees not pencil out vs full time employees. Can't blame businesses for wanting to do things efficiently...

Although I do know a number of workers that are part time in professional roles and still make the same per hour wage as a full time employee (often with lesser or no benefits, or prorated bennies).

 

[photoguy]

Productivity gains and related real wage growth over the last 50 years means today's worker could live like one lived 50 years ago, and save the surplus wages to fund their early retirement.

From the studies I've seen there is no surplus and real wage growth for the majority of americans has been flat. E.g. see the article by Mishel:

The wedges between productivity and median compensation growth | Economic Policy Institute

Most of the productivity gains have been going to the owners of capital not workers. Median compensation only went up 10% in the past 40 years. If you're a male, the median changed by a infinitesimal 0.1%.

It is a little strange that part time employment hasn't become more popular, but I guess for employers they prefer workers to work 40+ hours instead of twice as many employees working ~20 hours. Overhead costs like benefits, office space, IT, compliance, training, payroll, performance reviews etc mean there are large fixed costs per employee that probably make the economics of part time employees not pencil out vs full time employees. Can't blame businesses for wanting to do things efficiently...

I would definitely choose part time work but unfortunately in many fields it is simply not an option.

 

[Nords]

My frustration is not with working hard - it's with having to work hard due to dumb/inefficient internal policies/procedures (e.g. things that are in the company's control and could be changed if management wanted to).
After several years working, I no longer see the point in wearing a suit & tie if all I am going to do is sit in my cube and do email/powerpoint/excel. Sure, if someone is meeting with customers or a VP, put a suit on. But the rest of the time, I don't get it.

Yeah, it was much easier for the 1950s IBM employees when they could wear any color shirt they wanted (as long as it was white and came with a tie) and could sing the company song each morning as loudly as they wanted...