No way out: Indebted, underpaid, and miserable
Millennials just can’t catch a break.
Whether it’s psychologists blaming helicopter parenting for a perceived lack of “conflict resolution skills” or employers admonishing our age cohort for being unmanageable, amotivated slackers perpetually in need of instant gratification, it seems like the social pundits of mainstream news always have some kind of simplistic way of writing us off, some critique for why we are struggling with the perfectly reasonable demands of modern adulthood.
Relatively short shrift is given to widely researched social, economic, and occupational factors that exacerbate whatever underlying idiosyncrasies may be present in the average millennial. Too often, what gets buried under the noise are stories like this:
An eager and hard-working student, Brandon earned a spot at a private university in the Southeast—finally, his childhood dream of building spaceships seemed to be coming true. He shrugged off his nervousness about borrowing tens of thousands of dollars in loans, joking: “Hey, if I owe you five dollars, that’s my problem, but if I owe you $50,000, that’s your problem.”
But his light-hearted banter belies the long train of obstacles and uncertainties that have followed him at every turn. Unable to pass calculus or physics, Brandon switched his major from engineering to criminal justice. He applied to several police departments upon graduation, but he didn’t land a job.
With “two dreams deferred,” Brandon took a job at a women’s-clothing chain, hoping it would be temporary. Eleven years later, he’s still there, unloading, steaming, pressing, and pricing garments on the night shift. When his loans came out of deferment, he couldn’t afford the monthly payments and decided to get a master’s degree in psychology—partly to increase his chances of getting a good job, and partly, he admitted, to put his loans back in deferment. He finally earned a master’s degree, paid for with more loans from “that mean lady, Sallie Mae.”
So far, Brandon has not found a job that will pay him enough to cover his monthly loan and living expenses, and since the clothing company recently cut overtime and bonuses, he is worried. He keeps the loans in deferment by continually consolidating—a strategy that he said cost him $5,000 a year in interest. Taking stock of his life, Brandon is angry: “I feel like I was sold fake goods. I did everything I was told to do, and I stayed out of trouble and went to college. Where is the land of milk and honey? I feel like they lied. I thought I would have choices. That sheet of paper cost so much and does me no good. Sure, schools can’t guarantee success, but come on—they could do better to help kids out.”
An overwhelming majority of anecdotal reports I’ve heard over the past several years from friends and colleagues have borne striking similarities to that of Brandon’s. The effects of crushing student loan debt, persistent un- and underemployment, and the prevalence of unpaid internships create a compound problem whose total impact is more than the sum of its parts. It is more than just what such present circumstances are doing to the average millennial bank account-it’s what the current situation is doing to us on a psychological level.
The cost of college is ever rising. By recent estimates, it is up 250 percent when adjusted for inflation. The price of a bachelor’s degree, however, is often times the last thing on a high school seniors’ mind-college is still touted by guidance counselors, parents, and financial professionals as having an amazing return on investment, with median incomes of bachelor’s degree recipients coming in at around $55,700, almost $22,000 more than the median figure for high school graduates. The message that is oft-repeated is that money is no option, any debt incurred is an expense that will pay off. With that in mind, it’s no surprise that roughly 7 out of 10 students will have graduated with student loan debt, averaging $28,000, a debt that most researchers estimate will take around 11 years of steady employment to pay off completely.
However, in today’s occupational environment, “steady” employment is a thing of the past. Fewer and fewer work opportunities exist for a rapidly increasing pool of eligible candidates; recent graduates, short- and long-term unemployed, and ladder climbing employees fight tooth and nail for the most quotidian positions. To make matters worse, people over the age of 65 are putting off retirement, and with less vacancies to fill, hiring managers are forced to use keyword algorithms to sort through the glut of resumes and cover letters.
What has replaced the concept of a steady career post-college have been the realities of persistent underemployment and the rise of the unpaid internship. Internships, paid or not, are often seen as the foot-in-the-door necessary to obtain employment in any number of fields. The questionable ethics of such a practice aside, they are touted as a way to build networks with professionals while getting the chance to learn the ins-and-outs of the working world hands-on. Although Department of Labor regulations frown upon the use of these internships as a vetting period for potential hires, they are not explicitly restricted and are often used for such, with 30 percent obtaining a full-time post-graduation job through their first internship in the mid-2000s.
Unfortunately, the effectiveness of internships has declined with the economy. According to the National Association of Colleges and Employers (NACE), only 63% of paid interns were being offered a job by graduation. The figures are even worse for unpaid interns:
…only 37 percent of unpaid interns got an offer; that’s not much better than results for those with no internship—35.2 percent received at least one job offer.
Despite this, internships are still seen as the gateway into particular careers. With this, and the fact that Department of Labor regulations regarding the “educational value” of unpaid work are enforced selectively, the intern exists in a gray area of the law. Constantly at the mercy of their quasi-employer, they may be coerced into performing duties that would otherwise be performed by paid employees. The “educational value” of a particular duty is extremely ambiguous and ill-defined-delivering your boss’ morning cup of coffee could be construed as educationally salient because one is learning to be a supportive “team player.” A group of interns for the megapublisher Condé Nast recently settled with their former employer, citing violations of the Fair Labor Standards Act- nightmarish stories of aspiring young writers earning 12 dollars a day as gophers for publishing executives and working 24-hour weeks proofreading and editing, only to earn 300 dollars.
For those of us without legal recourse, the truth of our current predicament can only add to the feelings of hopelessness and powerlessness. Underemployment carries it’s own mental toll-social isolation, boredom, debilitating feelings of shame, and depression. Most millennials are forced to accept employment in clerical, office, or sales positions that see similarly high levels of depression and mental illness. The emotional costs of underemployment are compounded by the fact that individuals entering the workforce during economic downturns can expect lower lifetime earnings overall:
Lisa Kahn, an economist at Yale University, has studied the long-term economic consequences of graduating into a recession. In one study, she found that for every 1 percent increase in the unemployment rate, young people who graduate during a recession can expect in their first job to earn 6 to 7 percent less than they otherwise would have.
Till von Wachter, an economist at Columbia University, and colleagues have conducted similar research, and found that the wage loss associated with graduating into a recession lasts an average of 10 years. This is especially significant with a view toward the long-term earnings of those graduates, because other economists have found that two-thirds of the wage-growth of American workers happens in the first ten years that they are in the labor market.
To make matters worse, research by Northwestern University’s Feinberg School of Medicine reported that high levels of debt can likewise contribute to a litany of negative health symptoms including significant increases in perceived stress, irritability, depression, anxiety, and blood pressure.
Prominent psychologist Daniel Kahneman and economist Angus Deaton authored a study to explore the effects of money on happiness. Their research showed that those individuals with higher incomes were indeed more likely to report having a sunnier disposition. However, after earning around $75,000 annually, extra pay produces diminishing returns in terms of overall mood and perceived well-being. Individuals with incomes higher than $75,000/year end up feeling more secure, but are not necessarily happier.
If $75,000 is the cost of happiness, what does $75,000 mean for the average post-college millennial, struggling to cope with a decade-long debt burden and abysmal short- and long-term occupational prospects? These days between the competing expenses of housing, transportation, health care, and student loan repayment, not even $75,000 is enough to get beyond living paycheck-to-paycheck. There have been recent spikes in student loan delinquencies, indicating the cracks in the foundation have started to appear. Antidepressant use amongst college students nearly tripled from 1994 to 2006, and more millenials are continuing the use of these poorly understood psychiatric medications well into young adulthood. Medications typically used in the treatment of ADD/ADHD are becoming used as off-label study aids and work productivity boosters:
“Friends of mine in finance, on Wall Street, were traders and had to start at 5 in the morning on top of their games — most of them were taking Adderall,” Elizabeth said. “You can’t be the one who is the sluggish one.”
“It’s like this at most of the companies I know with driven young people — there’s a certain expectation of performance,” she said, banging away on that PowerPoint presentation as her own pills kicked in. “And if you don’t meet it, and I’m not really worried how, someone else will.”
We, as Millennials, are struggling to deal with the conflicting expectations of the performance-driven “adult” world and our recognition that the hand we have been dealt has been stacked against us. We face an assault on our competence from within and without, never entirely sure who to hold responsible for the situation we find ourselves in, plagued by ruminative doubt, confusion, anger, shame, and hopelessness.
An omnipresent cloud of uncertainty follows our generational cohort that only adds to the general mood of existential dread and hopelessness. We were taught that prior generations had some modicum of faith in elected officials to provide temporary assistance or relief. This is the core idea behind the social contract-the idea that we sacrifice some freedoms to the State so that our government may help us in our time of need. Indeed, some reforms have been offered, but are quickly squashed by legislative gridlock. Income-Based repayment plans have helped to ease the burden of loan repayment somewhat, but these are band-aids that fail to correct systemic issues unique to today’s economic environment.
Our millennial burden has been coupled with a slow and terrible realization that more and more of us coming to terms with: college was a broken social contract; we are being preyed upon; we are drugging and killing ourselves, desperately trying to cope in a world where we have no one left to trust but ourselves.
We are trying desperately to stay afloat, but many of us are being pulled down by the undertow.