The Class of 2016 is Worse Off Than the Class of 2000

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The New York Times editorial board penned a powerful column on the economic prospects for the Class of 2016. In short, the outlook is unpleasant. Here’s some data they provide to back up this conclusion:

  • Nearly 45 percent of college graduates ages 22 to 27 were in jobs that did not require a college degree, compared with 38 percent in 2000.”
  • “The recent unemployment rate for college graduates ages 21 to 24 was 5.5 percent, compared with 4.3 percent in 2000.”
  • College graduates’ underemployment rate — which includes the unemployed, those who have briefly left the work force and those stuck in part-time jobs — was recently 12.3 percent, compared with 7.1 percent in 2000.”

A “soft” US “labor market has depressed wages” for these young graduates. Today, the average hourly pay for university graduates is $18.53 which is “barely higher than it was in 2000, adjusted for inflation.”

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These stagnant wages are depressing enough on their own. But wait, there’s more!

College tuition and fees at private universities have increased by 51 percent from 2000-2015, while public universities have seen their tuition increase by 85 percent.

As a result, “the average student loan balance has increased by more than 78 percent since 2006.” An average graduate from the Class of 2015 “will have to pay back a little more than $35,000.”

With such bleak economic opportunities ahead of them, it is easy to understand why young Americans are not wildly advocating for bland, Democratic establishment policy choices like the Reducing Educational Debt (RED) Act.

The RED Act “would provide two years of tuition-free community college, low-cost student loan refinancing, and Pell Grants indexed to inflation.” Unfortunately, with the GOP controlling Congress, the bills are not going to be passed anytime soon.

So for now, the RED Act is used as a Democratic talking point – a mere thirty second blip during stump speeches which acts to assure young, indebted Americans that Democrats are the only party really looking out for them.

But advocating for refinancing student loans (down to 3.86 percent!) is nowhere near ambitious enough. How is that honestly going to alleviate our nation’s lackluster economic situation?  

The establishment’s policy prescription is ameliorative at best and dismissive at worst.

And yet some are still shocked that Hillary Clinton continually gets walloped by the under 40 vote.

Why are all these young women not voting for a female nominee?

Why are they supporting a 74-year-old Jewish guy?

Don’t they know these ideas aren’t realistic!

Here’s your answer: young Americans are working harder than ever to earn less. That’s the reality. It’s why our economy still doesn’t feel like it’s in full gear. It’s certainly a major reason why the velocity of money, which “refers to how fast money passes from one holder to the next,” has been in a deep quagmire since 2000.

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This graph shows what happens when stagnant wages meet a recession, sky-rocketing college costs and student debt. The results are uninspiring. As our own Hanna Brooks Olsen put it,

[My generation] did exactly as we were told…I did super well in high school…I got into college, I went into university, just like I was supposed to do. And what it got me was a ton of debt, not very great job prospects, and a requirement to work 50-60 hours a work just to stay afloat…

Until Democrats understand what’s happening to the economic prospects of young voters, they will continue to see low turnout from millennials. Instead of pointing the finger at these voters, maybe the top candidates need to first prescribe ambitious policies which honestly address the economic crisis affecting young graduates.

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Nick Cassella
Nick Cassella graduated from the University of St Andrews in Scotland in 2014. After graduating, he worked on the Initiative 594 campaign before joining Civic Ventures, where he now manages Civic Skunk Works' social media presence.