Young and Broke in America | Voice of America - English
Americans under the age of 35 are having a tougher time than their parents faced striking out on their own and getting ahead. This is particularly true for recent college graduates who account for about 28 percent of the workforce. In 1972, an average 25-to-35-year-old American male with a high school diploma earned around $42,000 per year. That same age group now earns a little more than $29,000 a year, adjusted for inflation. In contrast, an average college graduate earns more than $40,000 annually, driving home the need for a higher education in today's highly skilled job market.
"The minimum would be about ten years. Some people are refinancing their loans and stretching that to thirty years. If you have a very large debt burden and about eight percent of students borrow more than $40,000 to get a college degree, then they are likely to refinance. And I've met students who are actually paying only the interest on their loan so that their loan burden doesn't go down at all from year to year," says Kamenetz. Even as they join the workforce armed with a college degree, today's younger workers face a different world than the one their parents knew. 18-to-35's Jonathan Zaff calls it a societal change. "President Bush calls it 'The Ownership Society.' Other people call it 'Burdening people with too much responsibility for their individual well-being' when it should be a societal issue. But it's this idea that, generationally, you look at those who are in the 18-to-35 age range, and they grow up at a time when there's no longer an assumption that social security [i.e., the U.S. government's pension and benefits system] will be around," says Zaff. "There's no longer an assumption that the job you take will come with a pension. So you almost become content with what you have. You hopefully have enough money to survive." Additionally, the labor market has changed. Most analysts point out that many of today's younger workers have to contend with temporary, short-term jobs and almost none of the stability or benefits their parents enjoyed when they entered the workforce. Some experts say this is forcing more young people to live with their parents longer or move to cities with lower costs of living. Analyst Tamara Draut says this generation's decisions have broader economic repercussions. "The burden of debt is impacting young people's decisions about what they're going to do for a living. We have major shortages in the nursing and teaching fields. We're seeing delayed home buying, low savings. And the important thing to remember is that student loan debts don't go away over time. In fact, most people will take about ten years to pay off their student loans," says Draut. "So, at the time when you're getting married and starting a family, today it's not at all uncommon to still be chipping away at student loan debts and possibly have much bigger debt if you went to graduate school."