RUSSELL LUCKOCK | LETTERS | PETER SHIRLEY Better educated, but why do millennials face a harder life?
YOUNG people in the West Midlands today are earning just one per cent more than the generation that went before them.
That’s the finding of a new study that looked at what life is like for so-called millennials.
Think tank the Resolution Foundation looked at the prospects for people born between 1986 and 1990, and considered how that compared to the experiences of people born between 1971 and 1975 – the age group sometimes known as Generation X.
What it found is that there has been very little progress in pay and in some respects, life is harder.
But the picture isn’t the same all over the country. In the North East, for example, wages have gone up significantly. Whether that’s any consolation for people in the West Midlands is debatable.
It’s also harder to become a homeowner than it used to be.
We expect our children to do better than us. Surveys have found that a majority of people believe social progress is about younger generations experiencing better living standards than those that came before them. But at the same time, there’s a belief that it’s not happening. Pessimists about the prospects of today’s young adults outnumber the optimists two-to-one.
Where you live makes a big difference to your prospects. And it’s actually becoming more important than ever – because we’re moving around less than we used to.
Mobility rates for young people in particular have been falling in recent years. And when people do move, they tend to stay in the local area. The Resolution Foundation highlights one recent study which found nearly 45 per cent of people in the UK will only ever work in the place where they were born.
One of the most obvious ways of considering whether people are better off is to ask whether they are earning more.
But in the West Midlands, median weekly pay for people born between 1986 and 1990, at around £410, is just one per cent higher than it was for people born in the early 1970s when they were the same age, after the impact of inflation is taken into account.
Meanwhile, in the East Midlands, real-terms pay has actually fallen.
And millennials in London and the South East are also earning less than their predecessors – although pay there is still higher than it is in the West Midlands.
The employment rate for millennials in the West Midlands is down, compared to employment rates for Generation X when they were young. It’s only a small drop, of one per cent, but it suggests life for young people in the West Midlands is getting harder rather than easier.
By contrast, the employment rate in the North East is four per cent higher than it was for the previous generation.
Another question you might ask if you are considering whether life is getting easier or harder is how well people are educated.
The good news is that around one in three young people in the West Midlands now has a degree or an equivalent qualification, a major increase compared to Generation X.
But of course, the number of places at universities has shot up, and you might expect the figures to be higher in every part of the country. When you compare the West Midlands to other regions, we actually have one of the smallest increases. In the North East, young people are almost twice as likely to have a degree compared to the previous generation.
The report says: “The proportion of young adults who are graduates in the North East has doubled since the late 1970s, with almost one out of every three millennials from the 1986-90 cohort having gained a degree-level qualification.”
Another poorly performing region is Yorkshire. The Resolution Foundation report finds that Yorkshire and the West Midlands are two regions where life isn’t improving as quickly as in other regions.
It says: “Rather than catching up with leading regions like South East and London, the West Midlands and Yorkshire and the Humber are falling further behind.
“This analysis of the labour market shows that no place is performing consistently well across both young adults’ living standards today and rates of improvement since the late 1990s. There are, however, some significant regional differences.
“Wales, the West Midlands and Yorkshire perform consistently poorly in terms of young adults’ outcomes compared to their counterparts in other regions today. The West Midlands and Yorkshire stand out particularly as they also perform poorly in terms of rates of change compared to those born 15 years before when they were the same age.”
A well-documented problem facing young people is the difficulty they face buying a home. Of course, this is a particular problem in London. But in many parts of the country, what was once a rite of passage for young people now has to be delayed for years, or decades.
The West Midlands has seen the biggest drop in home ownership of any region outside London.
The report warns: “We have already shown that the West Midlands and Yorkshire and the Humber are regions where millennials face the least favourable labour market outcomes compared to peers in other regions, and their predecessors where they live. For the West Midlands, these challenges are compounded by the housing market.
“Indeed, the West Midlands follows London closely in terms of home ownership, with the secondlargest intergenerational decrease in ownership rates for millennials compared to generation X.”
What was once a rite of passage for young people now has to be delayed for years, or decades