Wages in the United States have been nearly stagnant since the 1970s, especially when compared to productivity.as CNBC article According to last year’s report, “Between 1979 and 2020, worker wages increased by 17.5% and productivity grew more than three times faster, at 61.8%.”
This gap between income and productivity is felt especially acutely by young people. Even though Millennials are more educated, income decreases Additionally, 53% of Gen Z believe the high cost of living is a “barrier to financial success.” write Author Laurie Conish.
These problems were further exacerbated by both the 2008 financial crisis and the financial, physical and psychological shocks of the COVID-19 pandemic.
as pointed out by economist“These two major shocks fostered pessimism among the young people who experienced them.” A study published in 2022 by consulting firm McKinsey found that a quarter of Gen Z could not afford to retire. It turns out that fewer than half of people believe they will someday own a home.
But these low wages haven’t stopped Millennials and Gen Z from spending.the same work economist It points out how spending habits have changed. Young people are more likely to purchase products they discover on social media and use buy now, pay later services. Additionally, travel accounted for a significant portion of young people’s expenses.
Looking at this spending, some older generations may wonder why young people don’t seem to be saving. It has now gone viral after users on TikTok shared their answers.
In a video with more than 978,000 views as of Sunday, TikTok user Maria Melchor (@firstgenliving) shows young people with little money owning nice things and going on trips. It explains in detail the reasons why.
“When older people ask how young people get access to nice things that they wouldn’t buy themselves, they say it’s because we can’t afford anything else,” she says. say.
“Owning a home and starting a family is so far out of reach that we spend that down payment and our children’s money on things we can’t afford to help us grow into the adults we were promised. ” she continued. . “We’re willing to let go of any lingering delusions about homeownership when the home is worth $1 million or more, and an older couple is likely to outperform us anyway.”
Instead, the young people joke, they’ll use their limited funds to “give our dogs the best possible puppyhood.”
@firstgenliving #gillenial #dink ♬ Original song – Maria First Gene Living
In the comments section, the majority of users agreed with her assessment.
“We’re on catastrophic spending right now,” one commenter summed up.
“My mom asked me when I was going to stop traveling and buy a house. I can’t afford to buy a house, but I can travel,” another user shared.
“The future is not guaranteed and is crumbling before our eyes,” a third explained. “Enjoying what we have while we can is the way to go.”
“Lol spent $2,000 on a couch and as a 28-year-old full-time lawyer living in a studio, this is all I can afford,” another TikToker admitted.
The Daily Dot reached out to Melchor via email.
*First published: December 17, 2023 at 8:00 AM CST
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Braden Bjella is a culture writer. His work has appeared in Mixmag, Electronic Beats, and Schon! magazines etc.