Generation Y: The Broke Generation

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No group in America has been hit harder during the current recession than young adults.  Millions of Americans are graduating from college with virtually no money, lots of debt and with very dim employment prospects.  Those who don’t go to college are even worse off.  All their lives these young Americans were taught if they studied hard, got an education and worked within the system that good jobs and the American Dream would be waiting for them.  But now millions of them are realizing that all of their studying and hard work is not providing them with the rewards that they always thought they would get.  This is causing large numbers of young American adults to become depressed and disillusioned.  In fact, record numbers of them are moving back in with their parents.  But without decent jobs, what are they supposed to do?  


According to the Bureau of Labor Statistics, in March the national rate of unemployment in the United States was 9.7%, but for Americans younger than 25 it was 18.8%.  In fact, according to a Pew Research Center study, approximately 37% of all Americans between the ages of 18 and 29 have either been unemployed or underemployed at some point during the recession.

Things are even worse for those under the age of 20.  According to a new report based on U.S. Census Bureau data, only 26 percent of American teens between the ages of 16 and 19 had jobs in late 2009 which represents a record low since statistics began to be kept back in 1948.

But the inability to get good jobs is only part of the story….

*The Pew Research Center study also found that only 61% of Americans between the ages of 18 and 29 are covered by some form of a health plan.

*According to a National Foundation for Credit Counseling survey, only 58% of those in “Generation Y” pay their monthly bills on time.

*Not only that, but according to a November MetLife poll, nearly 70% of those in “Generation Y” are not building up a cash cushion, and 43% are accumulating too much credit card debt.

*According to Fidelity Investments, those in Generation Y have more than three credit cards on average, and 20 percent of them carry a balance of at least $10,000.

So what does all this mean?

It means we are raising a generation of young Americans that are a financial mess. 

But isn’t that our own fault?

After all, most young Americans have never received any formal training on how to manage their money, and the role models of financial responsibility they do have (the rest of us) are hardly worth emulating.

But if each generation of Americans is becoming increasingly financially irresponsible, what does that mean for the future of this nation?

  • actually

    Actually most of us were taught the opposite. We are the lazy spoiled, entitled offspring of slightly less lazy far more self involved baby boomers. Our parents were spoiled by a generation that went through hell and didn’t want their children to want for anything. Unfortunately what they wound up raising was a bunch of ungrateful amoral sellouts.

    They taught us conformity was for squares (thats why we should buy every product they try to sell us), selfishness is next to godliness, hard work isn’t causative of success and “creative” activities are what cool people do.

    Now most of generation y thinks they are artists, living off their parents in places like williamsburg brooklyn, doing “cool” and “edgy” stuff like camping out in their friends back yard, spending $50 on ironic t-shirts from “vintage” stores and being too helpless to actually cook themselves a meal.

    The brokeness is more a function of out-of-whack priorities and an unwillingness to get an “office” job, most would rather be freelancers. Real jobs are for squares…

  • Tony Vogrincic

    I have to agree with your points, actually. Let’s just be honest and admit that Generation Y has been a pampered lot. Not much was demanded of them and even less was given by them. It’s not all their fault though. It’s our fault too. We taught them that they have rights (without responsibilites), that they can do anything they want (without putting out) and that they were the center of the universe (without expecting them to be concerned about other people just as much as themselves). Well guess what. We lied to them and now they’re simply finding out for themselves what life can really be like. A hard lesson to sure, but welcome to life.
    Regards from Canada.

  • I think this is an absolutely fascinating post and the follow-up comment is intriguing because I think we are seeing similar trends in South Africa as well.

    A lot of young adults in the 20 – 30 age group literally cannot live month to month. Obviously the financial crisis hasn’t helped and a major statistic for us is that in 2009 we lost 900000 jobs in our economy. This is significant because it wipes nearly every single job that has been created since we became a democracy in 1994.

    A lot of young people have been pushing this line of “fake it until you make it” – this crisis has found them out.

    But what really jumped out at me is the comment above about peoples willingness to get an “office” job. A lot of the local “thought leaders” are talking about the whole mobile office, “day-lighting” type workforce. It will be interesting to see whether or not that gets any traction.

  • The way around this is to read Rich Dad Poor Dad, and start increasing ones financial education. This country does a poor job of educating people to manage money as we’re not aiming to create a wealthy nation, we’re aiming for a decent class system where we have workers and bosses.

    This works well as long as everyone plays fair…of course and is held accountable.

  • Zeke

    For many years, I have watched the pampered young. Parents who provided everything whenever, where ever and how much they wanted. I remember calling a friend stating I was thinking of coming over the next week and he had to consult his “taking his kids places” calendar. He now has two adult daughters living at home and one is pregnant for the second time. No father in sight of course. I am watching, virtually, every retired couple I know support kids whining about how “I can’t make a living”. B…S…Unfortunately we have endless blogs and media sources whining the same tune. Of course you can’t make a living when you want every gadget the market can offer, a very good car, a nice home, a soft job and fancy vacations. I watch it every day. I remember the early years of old cars (learned to work on them myself), an 8×28 foot trailer the first three yrs of marriage, no eating out, no phone, etc.

    We are a country that lost it’s way long, long ago at every level from my neighbor to the President.

  • RD NYC

    Can you really blame an entire generation for the failings of our economic system? When my father bought his first house at 25yrs old the bank required the monthly payment to equal one weeks take home pay. We lived well on one income and my father learned his trade on the job and never went to college. This was the late 1960s/early 1970s when jobs were plentiful and paid real wages. Today how many high school graduates can find a career without college that will pay for a house and family? My generation has not done as well but with a college degree and two incomes can achieve close to what my parents had with greater debt and working much longer hours. So it’s no surprise the current generation will need to each work two jobs and take on greater debt to achieve the American dream, whatever that really is at the moment.

  • What one generation excuses in moderation the next excuses in excess. I think we are seeing that play out in spades.

  • Lauren

    Ummm… As far as I know, Gen Y is just starting to turn 24 and 25 and the youngest of us are 6. We’re not the pseudo-intellectual hipsters mucking up Brooklyn, we’re the teenagers and college students taking unpaid internships. The only president we ever have voted for is Obama. I think the self-entitled brats of which you speak are the younger end of Gen X. (Although we are the generation of Hannah Montana, but hey, no one’s perfect!)

  • Ted Scheinman

    This posting and comments identify the two questions:
    1. What part of the lost American Dream is due to individual ignorance and lack of financial literacy?
    2. What part of the lost American Dream is due to systemic failure, inappropriate incentives, government failure, and fraud?Both are part of the answer.

  • Jamie Whitaker

    Your conclusion is entirely off the mark.

    You cannot blame the children for what the fiscal train wreck created by adults. The children did not allow elected officials in the 1970s through present to create the lavish public employee pension and retiree health benefits promises without funding them … creating a massive deficit that promises to increase taxes and fees paid primarily by generations that follow the baby boomers. Today, it is the equivalent of setting up a legalized looting of future generations’ earnings.

    The children did not allow the health care system to devolve into an unsustainable, inefficient mess over the past 30 years where paper shuffling and insurance companies’ desires to refuse payments for the insured accounts for a good chunk of the usage of funds in the industry.

    The children did not create the 3-strikes law in California which has resulted in almost as much money being spent on the prison system as we spend on the education system.

    A lot of kids today cannot afford college … Even fewer can truly afford to get married and to have children because the costs have risen so quickly while the earnings these kids get are left unchanged and heading somewhat lower.

    The Baby Boom generation’s selfishness is only slightly less disturbing than its members’ inabilities to accept responsibility for the mess they’ve created.

  • Clevelander

    Yawn…People since time immemorial have immigrated/moved to places where there ARE jobs…Millions moved from India/China to the US over the last few decades when the US was booming…The present generation of texting/XBoxing/Facebooking silver spooners need to be ready to do it too.

  • Clint Kantor

    Before you can thrive, you need to know how to survive. I don’t think enough people have those skills, I’m still working on them myself. Life is about survival first and nothing is guaranteed, and nothing is owed. But dreams are important, necessary. Have your head in the clouds, but with feet firmly on the ground, and you’ll stand a better chance of finding success and dealing with failure.

  • “… only 26 percent of American teens between the ages of 16 and 19 had jobs in late 2009…” No kidding – they’re still in high school, and there is no incentive for them to get a job, since mommy and daddy will pay for whatever they want. I see this all the time.
    I tell my kids over and over – you CAN get out of debt if you will simply STOP SPENDING.
    Let’s remember that, in many cases, you don’t HAVE TO move out of your folks’ house until you get married – unless you choose to do things that are against their values. Too many young people just want to have the ‘freedom’ to get drunk and get laid (or do drugs).

  • DF2

    I agree with Actually. You don’t need to be a genius to point out that kids now days are so spoilt that it may be too late to redeem them. All the privileges without all the responsibilities. You have young girls getting knocked up by dead beats all the time because the majority of their baby boomer mommy’s and daddy’s told them to feel and not think ahead intelligently. So now you have a growing group of people needing support from the taxpayer. Second you have young guys too busy playing Mr. Bad to get into college and make something of themselves. Another segment more likely to claim unemployment benefits. These types have always been around but now in alarming numbers; thats the difference. You can’t blame the financial collapse either. The trend started much before that.

  • Gary2

    blame it on the Nephelim sung to the tune of blame it on the alcohol by Jamie Foxx!