Generation Vexed: Young Americans rein in their dreams
Alicia Thomas, 20, had it all planned out: career at a nonprofit, married by 24, mortgage by 26.
Then financial markets went on a wild roller-coaster ride, portending that high unemployment and the stalled economy won’t be rebounding any time soon.
“I don’t want to invest in something I can’t afford, given the economy breaking down,” said Thomas, who is majoring in political science at UC San Diego. “I’ll be taking smaller steps.”
Call it Generation Vexed — young Americans who are downsizing expectations in the face of an economic future that is anything but certain. Career plans are being altered, marriages put off and dreams shelved.
“You can’t reach for the stars at this point,” Thomas said.
Fewer than half of Americans believe that the current generation will have a better life than the last, according to a Gallup poll this spring. It was the most pessimistic showing for that barometer in nearly three decades.
Another poll, of Americans ages 18 to 29, found that three-quarters of them expect to delay a major life change or purchase because of economic factors. The survey — released last week, just before the Standard & Poor’s downgrade of U.S. debt — was by the nonprofit Generation Opportunity, headed by Paul Conway.
“There’s a generation here being formed under the crucible of unemployment, debt and lack of economic chances,” said Conway, who was chief of staff at the Labor Department during the George W. Bush administration. “They’re just seeking an opportunity to get in the game.”
During the fight in Congress this summer over the debt ceiling, frustrated college students banded together to form a coalition called Do We Have a Deal Yet? John Glass, 21, was one of more than 100 student body presidents who signed a public letter produced by the group.
“Our generation is going to take the brunt of the force of the debt crisis,” said Glass, a government major at St. Lawrence University in New York. “It’s going to mean fewer jobs, higher interest rates, more debt.
“We’ll have to sacrifice,” he said. “This is a raw deal for our generation.”
The economy has been in sorry shape for so long that it has covered a significant portion of young people’s lives. The recession officially ran from December 2007 to June 2009, but with slow growth and high joblessness since then, it doesn’t feel much like it ended.
Adam Hobbi, 20, is already a veteran at dealing with economic troubles. His father, an engineer, was laid off twice during the recession and then saw his 401(k) fund topple.
Hobbi, unlike his parents and a huge percentage of their generation, will not be playing the stock market.
“I’m not one to really gamble, especially seeing what my dad has gone through,” said Hobbi, an engineering student at USC. “It’s been tough for all of us.”
Since mid-2008, unemployment in the 16-to-24 age group has been 13% and higher, according to the Bureau of Labor Statistics. Last month, it stood at 17.4%.
Dim job prospects have taken some of the sheen off advanced degrees.
Anthony Wong, a business major at Palm Beach State College in Florida, said his peers are debating whether to finish school. They complain that an expensive degree saddled with loans no longer guarantees a good salary or even employment.
“I think it’ll be harder for us to buy homes or apartments or cars — those big life purchases — down the line,” said Wong, 26.
The job situation could haunt young people for years, said Andrew Sum, director of the Center for Labor Market Studies at Northeastern University in Boston.
More than half of earnings growth over a lifetime happens in the first decade of a career, meaning that early unemployment can depress future wages for life, he said.
But older workers are staying longer in their jobs, forcing twentysomethings to fill up retail, fast-food and other part-time spaces that traditionally give teens their first paycheck. Without work experience, young job seekers will need to scramble for options, he said.
Trying to guess at what might be a secure career path has set Thomas’ head spinning.
“I’ve changed my major so many times, not knowing which will help guarantee a stable income, health insurance and the ability to put my kids through college,” she said.
“It’s made me realize that I could have my degree and be networking, but it would still be a challenge to find a well-paying job.”
Although no career choice is safe in a volatile economy, Sum said some majors are a better bet than others.
“Those majoring in computer science, engineering, accounting and health occupations, for example, have been much more successful in getting jobs,” he said. “Kids who majored in humanities often end up doing really, really badly in the labor market.”
But what if a student wants to pursue more artistic or humanistic endeavors? After all, college has long been seen as a time to ponder career paths.
Sum had a suggestion for these students: “Major in something they enjoy,” he said, “and also pick a second major that will help them find a job.”
Vikram Abraham, 19, thinks many students are overly concerned about economic conditions. He’s majoring in economics and accounting at UC Santa Barbara, interning at an investment bank and professes not to be worried about churning markets.
“It only strengthens my resolve,” Abraham said. “Most of my friends see the market as being terribly volatile, but now might be a valuable buying opportunity.”
Abraham is in the markets, investing for himself with confidence. He’s even making what some could consider risky bets.
“As young people,” he said, “we have our entire lifetimes to bounce back.”
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