A study carried out by The Resolution Foundation found that millennials (people aged 15 and 35) earned significantly less than their parents during their first years of employment. £8000 less to be precise.
The think tank found that “deep recession” of 2008-9 and its subsequent slow recovery is partly to blame, but the earnings of young people had in fact started to fall before the financial crisis. They discovered that older millennials, now in their early to mid-30s and therefore turned 25 before the financial crisis hit, were the first workers to earn less than those born five years before them.
The Resolution Foundation predicts that millennials are set to become the first generation to earn less than their predecessors. The research found that even if millennials wages improved rapidly (much like their baby boomer parents), their lifetime earnings would be about £890,000 - just 7% more than Generation X. In addition, they warned that a post-Brexit recession could cut millennials' earnings even further.
"Fairness between the generations is something public policy has ignored for too long. But it is rising up the agenda with the prime minister, politicians of all parties, business leaders and others rightly identifying it as a growing challenge," said David Willets, executive chair of the Resolution Foundation and Intergenerational Commission.
And just last week new Prime Minister Theresa May spoke about the issue of a disadvantaged younger generation last week, describing it as a "more prosperous older generation and a struggling younger generation".
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