"Indeed, the no-hire no-fire labor market, coupled with the asset headwinds of unaffordable housing and low wage growth, means the youngest entrants to the labor market could face "long-term scarring." But the outlook for Gen Z isn't just affecting these young individuals; it's having wider ramifications for the economy as a whole."
""For young workers, the state of the labor market is the most important piece of the puzzle when determining overall economic health, as these individuals have not had the opportunity to accumulate wealth," writes associate economist Grace Zwemmer. "Young workers are more vulnerable to economic downturns, and a weak labor market can have a lasting negative impact on wage growth and earning potential.""
"The report, titled 'The kids aren't alright', describes how $12 billion a year is being lost because younger people are spending less on housing, transportation, and food by living in the family home. One of the key factors determining the outlook for Gen Z is the job market, where the hiring rate has been trending down since 2022, and now lies at 3.2%, well below its historical average and on par with the rate during the COVID pandemic."
Gen Z job seekers, aged roughly 13 to 28, face a weak hiring environment and multiple barriers to entry that risk lasting damage to earnings and wealth accumulation. Hiring rates have trended down since 2022 to about 3.2%, near pandemic lows. Unemployment has risen fastest among less-experienced cohorts, with 16- to 19-year-olds facing roughly a 14% rate versus a near-4% overall moving average. Many younger people remain in the family home, reducing spending on housing, transportation, and food and resulting in an estimated $12 billion per year in lost consumer activity. The combination of labor-market weakness and asset headwinds could create persistent economic scarring for the cohort.
Read at Fortune
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