Millennials are not all worse off than their baby boomer counterparts, a new study from the University of Cambridge found after analyzing major differences in the life trajectories and wealth accumulation of the generations in the U.S. However, a stark and growing wealth gap exists between the two groups.
Millennials are more likely to work in low-paying jobs and live with their parents, researchers found. But "those living more 'typical' middle-class lifestyles often have more wealth than their boomer parents did at the same age," the study, published in theAmerican Journal of Sociology in September 2023, reported.
Lead author of the study, Dr. Rob Gruijters said the debate about whether millennials are worse off is a distraction. "The crucial intergenerational shift has been in how different family and career patterns are rewarded."
Here’s what else researchers discovered.
Key findings: Millennials vs. baby boomers
- By age 35, 17% of baby boomers moved into a prestigious professional careers after graduating college, such as law or medicine, while 7.3% of millennials did the same.
- Millennials tended to postpone marriage and live with their parents for longer amounts of time. About 27% of boomers got married earlier and became parents early, compared to 13% of millennials.
- By age 35, 62% of boomers owned homes, while 49% of millennials were homeowners. Around 14% of millennials had negative net worth, compared to 8.7% of baby boomers.
- About 63% of low-skilled service workers who identified as boomers owned their own home at 35, compared with 42% of millennials in the same occupations.
- The poorest millennials in service sector roles were more likely to have negative net worth, compared to boomers.
"This divergence in financial rewards is exacerbating extreme levels of wealth inequality in the United States," Gruijters said. "Individuals with typical working class careers, like truck drivers or hairdressers, used to be able to buy a home and build a modest level of assets, but this is more difficult for the younger generation.”
Gruijters said the solutions to addressing these wealth inequalities include progressive wealth taxation and policies like universal health insurance, giving more people security.
Baby boomers have the largest net worth
Baby boomers own 52.8% of all wealth in the U.S., compared to 5.7% of millennials, according to the Federal Reserve.
How was the data collected?
Researchers from the University of Cambridge, Humboldt University in Germany and the French research university Sciences Po analyzed work and family life trajectories of more than 6,000 baby boomers and 6,000 millennials in the U.S.
Researchers posed the following questions:
- How does the distribution of household wealth at age 35 differ between millennials and babyboomers?
- How do early work and family trajectories differ between millennials and baby boomers?
- How do the wealth returns to different work and family trajectories vary between millennialsand baby boomers?
- To what extent can cohort differences in household wealth be attributed to changes in work andfamily life courses?
The study compared late baby boomers (born 1957-64) with early millennials (born 1980-84), using data from the National Longitudinal Survey of Youth.
What years are baby boomers?Here's how old this generation is in 2023
They can't buy into that American Dream:How younger workers are redefining success
FAQs
It found that Millennials were statistically more likely to work in low-paid service jobs or live with their parents as they entered middle age. Most of these individuals were economically worse off at 35 than Baby Boomers with comparable careers and lives.
Are millennials really worse off than boomers? ›
Millennials are not all worse off than their baby boomer counterparts, a new study from the University of Cambridge found after analyzing major differences in the life trajectories and wealth accumulation of the generations in the U.S. However, a stark and growing wealth gap exists between the two groups.
What is the difference between the baby boomer generation and the Millennials? ›
Baby boomers are the eldest, born between the years 1946 and 1964. Generation X follows, and they were born between 1965 and 1980. Next comes Generation Y (more commonly known as Millennials), born between roughly 1981 and 1994.
Are millennials less wealthy? ›
Even as the vast majority of millennials struggle with student debt, low-wage service-jobs, unaffordable housing and low savings, the millennial elite are surpassing previous generations. According to the study, the average millennial has 30% less wealth at the age of 35 than baby boomers did at the same age.
Why are millennials struggling? ›
But on many fronts, Millennials are struggling. Incarceration rates among Millennial young adults are dramatically higher than they were when members of the Silent Generation and Baby Boom were the same age. The federal minimum wage hasn't risen since 2009, but inflation and cost of living have.
Which generation is struggling the most? ›
Not just growing pains: Gen Z reports suffering more than other generations did at their age. A new study from Gallup shows a crushing youth mental health crisis, because teens are more tuned in than ever.
Who are the unhealthiest generation? ›
Millennials (and the kids born after them) are currently being called the “unhealthiest generation” in human history—facing diagnoses, mysterious illnesses and conditions that our ancestors or their parents never faced.
Who is the richest generation? ›
Millennials stand to become the richest generation in history, after $90 trillion wealth transfer. Millennials are set to inherit as much as $90 trillion in assets before 2044, a new report shows.
Is it more expensive to live now than 30 years ago? ›
The price of everything, from a sack of flour to a winter coat, keeps climbing every year. Since 1970, the Consumer Price Index saw a 500%-plus increase. Even after adjusting for inflation, today's dollar buys a whole lot less than it did 50 or even 25 years ago.
Which age group is the richest? ›
As of 2022, the average net worth of Americans under 35 was $183,500, $549,600 for ages 35 – 44, $975,800 for 45 – 54, $1,566,900 for 55 – 64, $1,794,600 for 65 – 74 and $1,624,100 for 75 and up.
Gen Z workers also report the highest rates of wanting to quit their jobs within the last three months compared to all other generations. In addition to feeling the least engaged in work, Gen Z also finds their responsibilities uninspiring.
Are millennials the most stressed generation? ›
According to Cigna International Health's 2023 survey of almost 12,000 workers around the world, 91% of 18-to-24-year-olds report being stressed – compared to 84% on average. Research indicates Gen Z are emerging as the most stressed demographic in the workplace, and struggling mightily to cope.
Which generation is the most educated? ›
Highly educated
Generation Z students are on track to become the most educated generation. They have higher high school graduation rates and lower dropout rates than those who came before. In 2018, 57% of 18 to 21-year olds were in college, compared with 52% of Millennials, and 43% of Gen Xers at similar ages.
