The income boom enjoyed by people born between 1966 and 1980 has turned to “bust” for the generation that followed them, according to a report published Monday.
In an analysis of eight high-income countries, the Resolution Foundation think tank found that millennials in their early 30s have household incomes 4 per cent lower on average than members of so-called Generation X at the same age.
Britain and Spain stand out. In the U.K., Generation X were 54 per cent better off than baby boomers born between 1946 and 1965. By contrast, millennials, born between 1980 and 2000, had incomes just 6 per cent higher than those of Generation X at the same age.
The U.K. is also notable for the fall in rates of home ownership. For millennials in their late 20s, the figure is 33 per cent compared with 60 per cent for baby boomers at the same age. Smaller declines are found in Australia and the U.S.
“It’s no secret that the financial crisis hit the vast majority of advanced economies hard, holding back millennial income progress in countries around the world,” said Daniel Tomlinson, a policy analyst at the Resolution Foundation. “But only Spain echoes the U.K. experience -- a ‘boom and bust’ cycle where significant generation-on-generation gains for older generations have come to a stop for younger people.”
Adjusted for inflation, pay for British millennials has fallen by 13 per cent, a decline surpassed only by Greece, the think tank estimated.
Looking at other countries, the Resolution Foundation said the U.S. and Germany had seen minimal generation-on-generation gains. Typical incomes for Americans approaching 50 are no higher for those born in the late 1960s than those born in the 1920s.
However, Norway and Denmark had made better progress, with Denmark doing so despite experiencing a recession as deep as the U.K.’s during the financial crisis.