Byrd: Younger generations need an investment
While perusing my Twitter feed Friday for an idea to write about for today, I stumbled across a Mother Jones article entitled "I'm Gen Y, and I'm Not a Special Snowflake. I'm Broke."
Written by Adam Weinstein, the article drives home the idea that previous generations view Millennials as whining brats who feel entitled when the reality is that generation faces widespread underemployment while simultaneously being saddled with more debt than any generation before it.
"I don't feel special or entitled, just poor," Weinstein writes. "The only thing that makes me special is I have more ballooning debt than you. I've tempered the hell out of my expectations of work, and I've exceeded those expectations crazily to have one interesting, exciting damned career that's culminated in some leadership roles for national publications. And I'm still poor and in debt and worked beyond the point where it can be managed with my health and my desire to actually see the son I'm helping to raise."
U.S. Census Bureau data shows that real median income by generation and age declined for more than a decade for Baby Boomers, Gen X-ers (that's me) and Millennials. According to the chart, Baby Boomers had their ups and downs between the 1970s and 1990s, but never saw real median income decline for more than about five years before the trend was reversed.
Data from the Economic Policy Institute shows that worker productivity since 1979 has increased greatly while compensation has lagged and even declined. Experts say the gap is a result of the introduction of technology into the workplace, and that probably accounts for more than 50 percent of the difference.
I mean, let's face it. As a news editor in today's editorial department, I'm able to design, build, proofread and print up to 10 newspaper pages in an eight-hour workday without breaking a sweat. In yesteryear's newsroom, that same amount of productivity would have taken at least 10 employees, including photo editors, news editors, a couple of page designers to cut and paste pages together and at least one copy editor to review the final product.
Accounting for inflation, am I paid the sum of what those 10 employees would be making in today's economy? No, I'm not even in that ballpark. If my paycheck were to reflect my productivity as the two were related in 1979, I wouldn't need a 30-year mortgage on the current price of my house. But this newspaper company wouldn't be able to afford me while offering its daily product to you for $1. No, your newspaper would cost closer to $10 -- if not more!
And that's the argument against increasing the nation's minimum wage -- if wages go up, prices go up and if prices go up, what good was accomplished by increasing wages? But our economic reality is that prices have gone up while wages have failed to keep up.
I may not have the college debt Weinstein is saddled with, but every year my electricity bill goes up, my cable bill goes up (not a necessity, but good to have), my mortgage goes up to cover increasing property taxes and my grocery bill goes up.
If both my wife and I fail to work hard enough to earn a raise to cover the increase in our cost of living, we're losing profit that can be used to take a vacation, save for our children's education or pay for our health care. If a business can't stay afloat as profits are chipped away, how can my family?
Weinstein wrote that our parents "accumulated a huger 401(k) to cash out before the Great Recession, because they saved more. And they saved more because the costs of college, of kid care, of health care, of doing business and staying alive and buying groceries and staying connected, were far less than they are today. They could raise a family on one salary if necessary."
So older generations who fared much better in years past look down on Gen X-ers and Millennials and compare our economic situations to their own, but this is fallacy. The trials and tribulations of the Greatest Generation or the Baby Boomers can no more be compared to that of later generations than America's poor can be compared to Africa's poor. The basic principles are the same, but the field of play has changed too much.
Here's an idea: If more businesses viewed employees as assets instead of liabilities, more members of the workforce would feel justified in having saddled themselves with heavy loads of debt. Am I saying companies should invest more in their employees? You bet I am.
Just read this example: On Jan. 5, 1914, Ford doubled its pay to $5 a day and cut shifts from nine hours to eight, according to sources on the entry in Wikipedia. The moves "were not popular with rival companies, although seeing the increase in Ford's productivity, and a significant increase in profit margin, most soon followed suit."
Investing more in employees may seem like a radical idea to members of older generations, but it's no more radical than the idea to limit full-time employees to a 40-hour workweek. That move was made in 1937 with the Fair Labor Standards Act, which set the maximum workweek to 40 hours and guaranteed employees working longer overtime salaries.
Weinstein had a point when he wrote, "This state of affairs does not exist because we're entitled and have simply declined to work as hard as the people that birthed us."
Companies have spent years investing in technology to boost productivity and their bottom lines, but as innovations in technology slows down, companies will have to look at investing into something else if they want to remain profitable. Why not the younger generations?
Byrd is the news editor for The Dickinson Press. Email him at email@example.com or tweet him at klarkbyrd.