Although the recession is officially over, recent jobs reports, stock market volatility, and other news indicate continued struggles and heightened insecurity for nearly all demographic groups:
- U.S. teens face their highest jobless rates in decades and nearly half of high school graduates who were unable to attend college are seeking full-time employment. While job prospects are better among those with a college degree, the rising costs of college education mean higher debt burdens. In spite of this, many young adults remain optimistic about their future economic prospects, though less than half of younger Millennials, individuals ages 18-to-24, believe that, in their lifetime, they will be better off than their parents. Fifty-five percent believe the American Dream no longer (or never did) hold true.
- Nationally, median net worth (total assets minus total debts) in 2010 was the lowest it has been since 1992. Families headed by adults ages 35-44 experienced the largest drops in net worth between 2007 and 2010, with median net worth declining from $92,400 to $42,100, a 54 percent decline. This was because housing is a major component of wealth for these households and home values were hit especially hard during housing market collapse and subsequent recession. Families headed by 45-54 year-olds and 55-64 year-olds experienced the next most substantial drops, 39 and 33 percent, respectively.
- Older adults are not alone in dealing with uncertainty about retirement sufficiency. New research shows that the average individual contributing to a retirement plan may lose nearly a third of their savings to account management fees.
Is this the end of the American Dream? That is, the end of the idea that you will succeed if you just work hard enough? The facts: Americans are less economically mobile than individuals in other nations, and this dream has never been equally attainable by all. Stories of individuals and communities overcoming long odds to reach great achievements still exist, just as they always have. But now, with rising insecurity putting more people who never thought that they wouldn’t succeed at risk—of medical crisis and bankruptcy, of job loss and foreclosure, of underemployment—it is clearer that hard work is not necessarily a guarantee of anything.
America—its society, culture, and economy—and the world are changing. Technology and globalization are dramatically re-organizing the structure of everything, from social interaction to the economy, in ways that are exhilarating, terrifying, and overwhelming. There are no easy solutions or quick fixes to the challenges facing individuals and their families, communities, and the nation. But, if the tales of rising insecurity across social and class boundaries tell us anything, it is that we are all in this together. And maybe we, collectively, can chart a path towards a new future and a re-imagined dream.
Rebecca Tippett is a Research Associate at the University of Virginia’s Weldon Cooper Center for Public Service where she studies household economic well-being and produces population estimates and projections.