A majority of young Americans do not believe the country is headed in the right direction, and more than a quarter identify economic factors like inflation as their primary concern about our future. [1] Millennials (born 1981 to 1996) are currently the largest working population in the United States. Compared to their Baby Boomer parents 30 years ago, working Millennials are earning about 20 percent less when wages are adjusted for inflation. [2] Gen Z (born 1997 to 2012) enters the workforce in earnest this decade and the Millennials’ results so far make the booming economic optimism of the 20th century seem like a forgotten memory. Already, the Gen Z workforce is compensating by pursuing side hustles at a rate that other generations never have, except they are still saving less money than their generational predecessors. [3] This is all not to mention the burdens of paying off student loans, increasing costs of living, and finding an affordable place to live.
In my graduate school public policy classroom, more than half the class, most of whom were under 30, indicated that they have little to no faith in Social Security surviving long enough for them to take advantage of it upon retirement. The impending 2035 exhaustion of the Social Security Trust Funds looms large over the generations who have the most to lose. And yet the current and future workforce of America, Millennials and Gen Z, believe the socioeconomic outlook is even more grim than that – and public opinion polls only reinforce what could be a self-fulfilling prophecy.
If these problems themselves weren’t bad enough, Gen Z doesn’t believe in those charged to solve the problems at hand. As a generation, they have less faith in institutions than any other generation at staggering rates. Only 14% of Gen Zers have high trust in the presidency and even fewer, 12%, have high trust in Congress. This follows a trend of rapidly eroding trust in the nation’s biggest social and political institutions across all age groups, but is observed most significantly among Gen Z. [4] Even worse, almost half of voters 30 years old and under believe, to some degree, that it does not matter who wins elections. [5] This lack of trust in the United States’ ability to govern itself, combined with the less than positive economic outlook, may book us a one-way ticket to a slow economic decline.
To ensure a productive and sustainable economy, the nation needs the buy-in of each new generation of workers. Millennials and Gen Z already don’t see the long-term rewards that were the standard of American generations before them. Generational optimism doesn’t only influence individual futures in the workforce, but influences economic and social behavior for decades to come.
How does this all tie into our national economic outlook and optimism going forward? Even if Gen Z did trust Congress and the President to bring solutions to the table, the federal government may be running out of the fiscal resources needed to take action. There simply are not enough working age individuals paying to support our aging population and sustaining our safety net systems. At its core, the United States has a demographic problem. Economic conditions play a huge role in determining whether Americans choose to be parents. As financial pressures like job security and childcare continue to mount on families, mothers are delaying having children longer than ever before, and the stigma around not having any children has waned in recent years. [6] Many state and local governments are also feeling the fiscal consequences of a smaller tax base, which will squeeze their budgets over the next few decades. The working age population will continue to shrink if young people can’t envision a future with the financial freedom to have children.
Declining birth rates are only one manifestation of a lack of generational optimism. Over time, more consequences will become apparent to us if we do not right the ship soon. A lack of optimism will directly contribute to worsening national economic conditions which, in turn, fuels more pessimism—an unfortunate cycle that will be hard to break. Without a tangible future to hold as an ideal, the drive to be productive members of the workforce will bottom out.
The nation’s fiscal future cannot afford a lack of optimism and trust from its younger generations. Governments, both federal and state, must take action to build bridges of trust to their younger constituents, improve their material conditions, or a combination of both to ensure that our future is not at risk. We are still capable of setting a better path than the one set for us by current trends and attitudes. A self-fulfilling prophecy can only be broken by those that set it in motion.
In what seems to be the darkest hour for our next generation, the nation’s lawmakers and leaders have an opportunity that is theirs to seize or miss. While many polls provide perspectives of the stress and misfortune that Gen Z feels about the nation’s situation, they are actually optimistic about their personal futures. Despite the odds seeming stacked against them, more than three quarters of Gen Z held optimism for their future and confidence in achieving their personal goals someday. [7]
If we fail to harness the collective confidence of a generation through inaction, the economic conditions ahead may sour even their individual outlooks. As of now, federal leadership considers its oldest workers while not equally addressing its youngest. We cannot risk our current cycle to continue as a result of a do nothing Congress. Our generation is haunted by a gloomy economic outlook, and if our nation’s lawmakers fail to enable this optimism, the self-fulfilling prophecy of economic decline is bound to continue.
