With a median household income of $40,581, millennials earn 20% less than baby boomers did at the same stage of life, despite being better educated, according to a new analysis of Federal Reserve data by the advocacy group Young Invincibles.
The Associated Press reports the analysis being released today gives concrete details about a troubling generational divide that helps to explain much of the anxiety that defined the 2016 election. Millennials have half the net worth of boomers. Their home ownership rate is lower, while their student debt is drastically higher.
The generational gap is a central dilemma for the incoming presidency of Donald Trump, who essentially pledged a return to the prosperity of post-World War II America. The analysis also hints at the issues of culture and identity that divided many voters, showing that white millennials—who still earn much more than their black and Latino peers—have seen their incomes plummet the most relative to boomers.
The analysis of the Fed data shows the extent of the decline. It compared 25 to 34 year-olds in 2013, the most recent year available, to the same age group in 1989 after adjusting for inflation.
Education does help boost incomes. But the median college-educated millennial with student debt is only earning slightly more than a baby boomer without a degree did in 1989.
The home ownership rate for this age group dipped to 43% from 46% in 1989, although the rate has improved for millennials with a college degree relative to boomers.
The median net worth of millennials is $10,900, 56% less than it was for boomers ages 25 to 34 in 1989.
Whites still earn dramatically more than Blacks and Latinos, reflecting the legacy of discrimination for jobs, education and housing. Yet compared to white baby boomers, some white millennials appear stuck in a pattern of downward mobility. This group has seen their median income tumble more than 21% to $47,688.