Demographers predict that today’s children may become the first generation since the 1970s to earn more than their parents because a future shortage of young workers could drive up wages, Stateline reports.
By around 2040, retiring workers are expected to outnumber new workers entering the labor force, creating strong demand for younger employees. Some states are already experiencing worker shortages, especially in industries like energy, construction, transportation, healthcare and retail.
The expected decline in young workers could also make housing more affordable. If home construction stays high while population growth slows, some regions may experience a housing surplus and falling prices, particularly in fast-growing states like Florida and Texas.
However, experts warn that these predictions are uncertain. Past forecasts about demographic changes causing economic shifts have often been wrong because factors like immigration, women entering the workforce and unexpected economic trends changed outcomes.
Immigration remains a major wild card because it can increase the number of available workers, potentially slowing wage growth. Artificial intelligence is another uncertainty, though many physical labor jobs are less likely to be replaced soon.
