Millennials Earn More Money Than Generations Past At The Same Age & The Reason Has To Do With Women
Incomes in American households are on the rise, and millennials now earn more money than young adults from any other generation over the last 50 years, according to a new analysis by the Pew Research Center. What’s more, says Pew Research Center, is that this growth in household income is led partially by millennial women, who are working more and getting paid more than women previously were. While millennials often (rightfully) bemoan how their earning potential was depressed by the great recession, and how things like the gig economy, inflation, and student loans mean we may never catch up to our parents' wealth, this data shows that there is hope on the horizon — for millennial heads of households, at least.
According to the Pew Research Center, millennial-led households — defined as ages 22 to 37 — earned on average $69,000 in 2017. The next closest group was Generation X, which brought in $67,600 in 2000 when adjusted for inflation, says Pew Research Center. "At least as of this point in the business cycle, adjusting for household size, households headed by millennials are doing better than almost any group of 22- to 37-year-old-headed households back as far as we can track it, with the possible exception of 2000," Richard Fry, a senior researcher with the Pew Research Center, told CBS News.
And millennial women are leading the charge, says CBS News, with 78 percent of millennial women working at least 50 weeks out of the year year compared to 72 percent of Gen Xers. Millennial women working full-time, year-round earned on average $39,000 in 2017 compared to $37,100 in 2000, CBS News reports. The slight increase in working hours and earnings was just enough to tip those historical scales, says CBS News.
So if women are earning more and making an historical impact on household incomes, you’d think that’d mean the end of the wage gap is in sight. But women still only earn anywhere from 49 to 80 cents to every dollar men earn in today’s workforce, according to the Institute for Women’s Policy Research.
If you don’t feel like you’re doing much better financially, there’s a reason for that. Despite these financial gains, the Federal Reserve came out with a report in November that essentially said millennials are the “brokest generation,” according to Slate. That’s because millennials are still dealing with a debt to income ratio that’s not tipped in their favor, says Slate. The Federal Reserve study basically found that high student loan debt and lower income as a result of the recession made millennials have lower net worths than Baby Boomers and Gen Xers when they first graduated from college, Slate reports. And Slate says while millennials’ household incomes are on the rise, when you look at household incomes overall, millennials are actually underperforming compared to other age groups today.
There’s also a large segment of millennials not even included in Pew Research Center’s data segment because they can’t afford to be the head of a household. In 2016, 15 percent of 25-to-35-year-olds were still living at home, according to Pew Research Center, and 75 percent of millennials were living at home in 2015, according to Slate.
It would be a remarkable financial turn if millennials were suddenly all earning the big bucks, but if you don’t feel like this accurately reflects your life, you wouldn't be alone. There’s lots of ways to interpret data like this, and it’s clear these findings are only part of the picture.