Has the millennial generation really been “screwed”?

Take a quick survey of friends and you’ll get answers from “yes,” to “no,” to eye rolls and groans at the mere mention of “millennials,” likely divided along lines of age.

Even the millennials themselves aren’t completely sold on the oft-floated notion that life is harder for them than it has been for previous generations.

“It’s hard to judge. You can’t compare your experiences with someone else’s,” said Matilda (better known by her friends as Mati) Barrett, a 24-year-old Ottawa resident.

“I’ve seen a fair amount of challenges. Our generation may seem to think that we go through more. But, I think that every generation goes through some kind of hardships when it comes to finance or jobs.”

Barrett is struggling through many of the same issues facing her peers. The former Dalhousie University varsity hockey goalkeeper completed her degree, a Bachelor of Science, with a major in kinesiology, in 2016, and is now struggling to find a career path. She lives at home, and holds down three jobs, which dominate her time.

She is keenly aware of the price of housing, which has been steadily marching upwards, and the increasing demands that employers are putting on candidates for higher education.

Canadians between the ages of 18 and 35, such as Barrett, have been caught up in an economic maelstrom — a pushing and pulling of forces — that is unique compared to anything faced by the Gen Xers or Baby Boomers who came before them.

Abacus Data regularly puts out the Canadian Millennials Report, a publication that’s dedicated to understanding the views of Canadians born between 1980 and 2000. More than 4,000 millennials are interviewed annually and results are released on a monthly basis.

“I’m seeing, in the data, a growing sense of a shared experience that is getting people quite anxious about their future,” says David Coletto, the company’s chief executive, and himself a millennial.

“There is something to be said for a growing collective understanding among this age group, and this generation, that somehow we’ve been screwed.”

•••

In 1980, Queen’s Another One Bites the Dust was on the radio, The Empire Strikes Back was in theatres, and the average Canadian between the age of 18 and 35 was making $34,200 a year. (That’s in today’s dollars, adjusted, not what was on their paycheque, according Statistics Canada.)

In 2016, as we were downloading Drake’s One Dance, and streaming Star Wars: Rogue One, the average Canadian between 18 and 35 was making $34,300 — a difference of … $100.

Average wages for people between the ages of 18 and 35 have remained stagnant for nearly four decades.

By comparison, people in the 35-through-50-year-old age group were making, on average, $49,500 in 1980. By 2016, their average income rose to $57,200, a $7,700 jump, according to Statistics Canada.

Those between the ages of 51 and 65 saw even bigger gains. Average salaries for that demographic were at $46,700 in 1980 and had jumped to $54,700 by 2016, an $8,000 increase.

The millennial salary stagnation is also happening at a time when benefits, such as dental care and Defined Benefit Pension Plans, are being pared back or even eliminated by employers, giving those older generations an even bigger financial leg up.

Laziness isn’t the culprit here. Millennials are working and working hard. In fact, they’re actually participating in the labour force more and, by some measures, working harder than previous generations did.

In 1980, 78.9 per cent of all Canadians between the ages of 18 and 35 were employed in some sort of job, according to Statistics Canada. In 2016, it was 81.2 per cent.

That increase is even more impressive considering the size of the demographic today. There are as many as 10 million people now in the millennial generation, accounting for 27.5 per cent of Canada’s population. That sheer size makes them the largest generational demographic in the country. It also suggests there are more people between the ages of 18 and 35 working in the labour force today than ever before. Still, there seem to be major hurdles in their path.

PLAY FOR THE HOME TEAM

Housing was the top issue cited by millennials in six surveys done by Abacus last year, Coletto says.

“Of those who don’t own a home currently, 86 per cent want to,” he said.

In 1980, the average price of a house in Canada was $203,972.86 — or about six times average annual salaries, once adjusted to account for today’s dollar values, the Canadian Real Estate Association says.

By 2016, the average home price hit $506,760.01 — or 14.8 times average annual wages.

“We have a situation where this generation is really, really stuck in many ways,” said Benjamin Tal, managing director and deputy chief economist at CIBC.

“This is really the story of this cohort: We have a situation where housing is much more expensive, so they have to compromise on either renting or they have to switch to condominiums or smart houses. Or, they might buy a car and stay with their parents.”

In the 1960s, Census data suggest as few as eight per cent of Canadians ages 18 to 35 were living with parents. Today, as has been well documented, those numbers have skyrocketed.

Come 2016, a total of 34.7 per cent of Canadians between the ages of 20 and 34 were living at home with their parents. That’s as many as 3.5 million Canadians, the highest number recorded to that point. And Ontario had the highest percentage of millennials still living at home: 42.1 per cent.

The situation hasn’t necessarily changed aspirations, though.

Last year, 94 per cent of the millennials living at home or with family planned to buy a home, a CIBC survey found.

How will they do it? A national survey by HSBC Bank of Canada, released in 2017, found 37 per cent of millennials who have purchased a home received some of the money for the purchase from their parents.

‘THE EDUCATION SYSTEM BASICALLY FAILED THEM’

“The only thing that is helping them is their parents,” said Tal from the CIBC. “The education system basically failed them. They are highly educated but they are not educated in what’s relevant. There is a mismatch between the skills that they have and what the economy needs and therefore you have many people underemployed and, or, trying to compromise.”

There is no denying that millennials are highly educated. A study released by the PEW Research Center in the U.S. suggests that they make up the most highly educated generation ever produced.

More than 3.5 million Canadians between the ages of 20 and 34 reported having some sort of post-secondary education, including bachelor degrees and post-graduate certificates and diplomas, in the 2016 Census.

But, the degree by itself isn’t proving to be enough.

“It’s not an option about whether or not they’re going to have an education. That’s like an invitation card to the party,” said Carleton University’s Linda Duxbury, a professor in management sciences at the Sprott School of Business who specializes in demographic trends. She’s also a member of the Baby Boomer Generation (people who are now 54 to 73 years of age).

“You don’t have the skills, you don’t have post-graduate education today, be it college or university, you aren’t even going to be looked at.”

Duxbury described the situation like an arms-race for qualifications to set a candidate apart from their competitors so they can land a good job and start their lives. The problem is, the process is forcing them to put their actual life on hold.

“The thing about this generation is that everything is delayed,” said Duxbury. “They stay in school longer, they get married later. If you start comparing the average age of marriage, the average age of their first kid, the average age of their first permanent full-time job.”

It’s also forcing those within the generation to compete with one another in ways that are specifically benefitting employers. With so much talent available, competition for available entry levels jobs is fierce. This allows employers to pay less for the workers they need. Some are even getting away with not paying their employees at all.

According to the Canadian Federation of Students, as many as 300,000 millennials were working in unpaid internships in a bid to further their careers by collecting relevant on-the-job experience, in 2016.

The issue with unpaid internships is that most millennials in those jobs are also working in another position, likely one that pays minimum wage, in order to make ends meet, according to the CFS.

The organization, which lobbies on behalf of students, also pointed to Statistics Canada data that shows, in 1997 (the first year that wage data was collected), only 640,000 Canadians were making the minimum wage or less. In 2017, that number sat at 1.02 million, almost double the number previously recorded.

Further compounding the issues facing the millennials is the steady drop in government support offered to post-secondary institutions. According to the CFS, government provided more than 80 per cent of university operating revenues in 1982. That figure fell below 60 per cent in 2012, the most recent year for which statistics are available. The CFS says government support has continued to fall in more recent years.

As government support has decreased, students have been forced to shoulder more of the financial burden when obtaining their education. That has led to students exiting post-secondary institutions with record amounts of debt.

Using data from Statistics Canada, the CFS said that average student debt levels have increased more than 40 per cent between 1999 and 2012. Those levels have continued to climb in more recent years.

The increased cost of education, at a time when obtaining a degree has never been more important, is another hot-button issue for millennials.

THE UNDEREMPLOYED GENERATION

“Underemployment,” a term used to describe people who are overqualified for the positions they find themselves in, is also rising rapidly.

For Ottawa’s Barrett, it means her Bachelor of Science degree isn’t enough for her to start a career. She is working at a family health clinic on a part time basis and as a goaltending instructor at two different businesses in the nation’s capital.

She is hoping the work will help to save up enough to help pay for a graduate degree.

“There is no getting anywhere with just a bachelor of science anymore,” she said. “I graduated. I played varsity hockey at Dalhousie University. Academic All-Canadian all five years I was there. I had a good GPA. That doesn’t matter in terms of getting a job. I need to get another degree in order to get a job in a desired field.”

She has applied to get into a program to become a physician assistant, but hasn’t been successful in getting into the program so far.

“It’s tough and competitive,” she said. “Even for a lot of the programs you are looking at applying to, to get an actual career. The amount of hours of experience you need, for example the physician assistant program that I applied to. It’s only offered by three universities in Canada and I couldn’t apply to the third, which is the University of Toronto, because they require almost 1,000 hours of health care experience. So, where am I supposed to get that? Hypothetically, what I’m doing now could count. But, most people applying to that, it’s their second career. They’re going to be older.”

In America, where numbers are more readily available, underemployment held steady at around 33 per cent of all post-secondary graduates between the 1980s and 2010.

However, that figure jumped to more than 44 per cent of all graduates in 2012, the most recent year for which statistics were available.

This week, Ontario’s Financial Accountability Office flagged underemployment as an issue that is affecting certain demographics and their ability to keep up financially.

“Income inequality has become more entrenched, as lower-income Ontarians are increasingly staying in low-income, and higher-income Ontarians are increasingly staying in high-income,” said Peter Weltman, the province’s financial accountability officer, in a report released Thursday.

He highlighted significant structural changes in Ontario’s economy and labour market, including a rise in part-time and temporary work.

“These trends in Ontario incomes raise important questions about the role of government in ensuring that all individuals have access to similar economic opportunities,” he said.

Abacus’s Coletto is seeing signs that the trend exists here in Canada, too. One of the key indicators of underemployment is wages, which would be reflected in the rise of minimum wage workers.

But, the other big indicator is the benefits offered by employers. Self-employed people, largely, don’t have access to benefits. People making minimum wage get a minimum amount of benefits from their employers. Only 55 per cent of millennials have access to a prescription drug plan, 53 per cent to dental insurance, 36 per cent to an RRSP, and only 29 per cent to an employer provided pension plan, according to a recent study released by Abacus Data.

THE WORKFORCE: EVOLVE OR DIE

Careers are also changing.

Older millennials in the demographic who graduated 10 or 15 years ago are finding the education that they worked so hard to receive, and paid good money for, is no longer relevant to the work they are expected to be doing.

In 1980, there were a total of 2,080,000 people employed in Canada’s manufacturing industry, according to Statistics Canada. By 2016, that number dropped by more than half to 1,032,900 people.

The professional, scientific and technical industry (which includes high technology workers) employed 393,400 people in 1980. That swelled to more than 1,393,700 by 2016.

Today’s employers are less likely to train existing employees to meet modern demands, choosing instead to hire younger, cheaper talent that is now exiting school with the skills they need.

“Jobs are becoming obsolete on a monthly basis. New jobs are taking over. As we move to AI (artificial intelligence), robotics, all these kinds of things, certainly jobs are going to be replaced. New jobs are going to be created, mostly at the high scale end,” said Carleton’s Duxbury. “(Employers) don’t spend the money on training and development that they should and they’d rather have someone coming in with the credentials, then they would training somebody who is currently working for them.

“My father, when he came back from the war, had a Grade 12 education. When he retired he was vice-president at 3M. Why? Because there was a different attitude then.”

“Is it harder to buy a home? Yes. Are we taking on higher student debt? Yes. Have we been trained and educated in the wrong things? Many of us, yes,” said Abacus’s Coletto. “We’ve been raised around these expectations. ‘Go do what you want to do. The world is your oyster. Dream big.’ Those expectations were set quite high. When you enter a world where it’s not possible to achieve the things that your parents and your teachers and society has been saying is going to be there, it creates further tension.”

BABY BOOMERS WON’T GO, CAN’T GO

The tension is being compounded by the Baby Boomer generation’s refusal to leave the workforce. If the millennials are stuck in a bottleneck fighting for career advancement, right now the Baby Boomers are acting like a cork preventing any movement.

Whereas the age 65 was once marked by a person’s announcing their retirement, today’s senior citizens are opting to soldier on. The idea of freedom at 55 seems long forgotten.

Extended life spans, better health and, in some cases, continued financial responsibilities are seeing many people in the Baby Boomer demographic work well into their 70s before opting for retirement.

“Boomers have significant expenses that perhaps they didn’t anticipate, plus they love their jobs and they’re healthy. They think, ‘What am I going to do for the next 25 years?” said Duxbury.

Duxbury also said that Baby Boomers are now finding themselves in a situation where they are caring for, or paying for the care, of their aging parents. Many also find themselves sandwiched in between paying for their parents, while also supporting their millennial children who have returned to the family home.

The millennials can’t afford to leave their parents homes because they don’t have the opportunity or means to do so. But, their parents can’t afford to retire, which would open spaces in the workforce for millennials, because they are still supporting those kids at home.

“It is a problem that the Boomers aren’t leaving. That’s absolutely true,” said Duxbury.

So, what comes next?

THE AWAKENING OF THE MILLENNIAL

Tectonic plates are beginning to shift.

That’s the opinion, at least, of Karen Foster, assistant professor at Dalhousie University and Canada Research Chair in Sustainable Rural Futures for Atlantic Canada.

One of Foster’s areas of expertise is in researching generational divisions at work. She said there is no doubt millennials are upset and that their complaints have been falling on deaf ears.

However, one of the larger issues that millennials are facing is a growing wealth gap between themselves and older generations. Due to the fact that major life milestones have been delayed, investments in real estate or other financial transactions aren’t yielding the same return for the younger generation, Foster said.

Sure property values have skyrocketed for older generations who bought when prices were affordable and have been hanging onto the property. But the millennial who just purchased is seeing bigger mortgages than ever before and interest rates that are steadily rising.

Critics of millennial concerns have often pointed out that are next in line to inherit massive amounts of wealth that has been accumulated by their aging parents. In fact, between 2016 and 2026, the largest wealth transfer in history is expected to take place as older generations pass on as much as $1 trillion to younger generations in Canada, according to Toronto-based research firm Strategic Insight.

But Foster pointed out one critical problem with the upcoming windfall: The expected transfer of wealth will only benefit those people who come from families that are already wealthy.

It will also affect people from major Canadian cities, where property prices have been steadily rising, in a much different way than those people from less populated towns. If your family is from somewhere such as Moncton, N.B., Moose Jaw, Sask. or Sudbury, Ont., you won’t see the same windfall when it comes time to collect an inheritance.

“People who are set to inherit money from their parents, or, in a sense, have been inheriting it their whole lives through various kinds of support, that’s where the real inequality happens,” she said, adding that millennials are looking to completely upend the status quo.

“That really comes down to a restructuring of the tax system. We need to be taxing wealth, and high incomes and corporate profits more in order to redistribute wealth across the demographics.”

Foster predicts that millennials are likely to push for things such as increased estate taxes in order to ensure that some of the wealth that is transferred from older generations is redistributed throughout all of society. The idea is being spearheaded in the United States by recently elected Democrat Congresswoman Alexandria Ocasio-Cortez. Ocasio-Cortez, who at 29 is also a millennial, is lobbying for the introduction of a tax on the wealthiest Americans in the country. She believes that every dollar of income over $10 million should be taxed at 70 per cent.

There will, of course, be pushback to that idea. It’s been panned by the audience at the World Economic Forum in Davos, Switzerland, as recently as last week. With attendees including Michael Dell, founder of Dell Technologies and Microsoft Corp. founder Bill Gates expressing objections.

The call for higher estate taxes in Canada was recently reinforced in a study released by the Canadian Centre for Policy Alternatives (CCPA).

“You’d expect Canada’s tax regime would try to counteract this concentration of wealth at the very top, where it’s needed the least, but in fact, federal policies encourage it,” said the centre’s senior economist David Macdonald in a release. “Canada is the only country in the G7 without an inheritance, estate or gift tax on tremendous family wealth.”

The CCPA’s report said Canada’s wealthiest families saw their net worth grow, on average, by 37 per cent between 2012 and 2016. Middle class families saw their net worth grow by only 16 per cent during the same time frame.

The study calls for high estate taxes, eliminating tax preferences for capital gains and dividend income in a bid to better distribute wealth across demographics.

That may sound like a scary scenario to older generations who have amassed wealth throughout their lifetimes, and typically been more conservative when it comes to political fiscal policies.

But, for the millennial generation it’s only the tip of the iceberg.

BRING THE BIG GOVERNMENT?

According to Abacus Data, millennials are looking to government to take big steps to fix their problems. This generation is more comfortable with big, interventionist government than allowing market forces to play their part, surveys suggest. Many millennials truly believe that the economic system that has been in place for hundreds of years fails to work for them.

The company’s research suggests that millennials clearly prioritize increased government spending over balanced budgets in order to tackle issues such as alleviating income inequality. They believe corporations don’t pay their fair share of taxes and that government has a big role to play in redistributing that money.

“Having lived through the 2008 financial crisis and a rise in housing costs, many are outright skeptical of the free market. When asked to indicate if they lean more towards one perspective or the other, only 46 per cent suggested that capitalism is the best economic model we have, while 54 per cent believe Canada would be better off with a more socialist system,” reads an Abacus Data survey released last year.

Perhaps the most pertinent fact: Millennials are now the largest block of voters in the country and have the ability to swing an election toward the party or platform of their choice, provided the generation gets out the vote.

So far, they have remained relatively quiet.

“In most elections politicians aren’t talking about issues that they care about, they aren’t very compelling, they aren’t giving them a reason to get engaged,” said Abacus’s Coletto.

“Millennials are unique from previous generations, particularly the Boomers and those who came before the Boomers, in that voting is not (considered) a duty. We don’t do it because we have to. We do it because we have a reason to.”

Reasons seem to be emerging.

According to Elections Canada, 38.8 per cent of eligible voters between the ages of 18 and 24 years of age voted in the 2011 federal election. Of those, between 25 and 34 years of age, 45.1 per cent cast their ballot. By comparison, a total of 64.5 per cent of Canadians between the ages of 45 and 54 voted in that election. When it came to Canadians between the ages of 65 and 74, a total of 75.1 per cent of eligible voters participated.

The federal election in 2015 saw better turnout by millennials. More than 57.1 per cent of eligible voters between 18 and 24 years of age cast a ballot. The number was similar in the 25 through 34-year-old age group, where 57.4 per cent of eligible voters participated.

One of the big issues during the 2015 election was the Liberal party’s promise to legalize cannabis sales in Canada, which is something that appeals specifically to the millennial generation’s interests. More than 60 per cent of Canadians between the ages of 18 and 34 supported legalizing cannabis, according to a study released by NRG Research Group and Peak Communicators in March 2017.

It’s expected that more politicians will be looking to woo the millennial vote heading into October’s federal election.

Last week, Finance Minister Bill Morneau said the federal government is looking at ways to make housing purchases more affordable for millennials in the months ahead. He called the issue a “priority” but didn’t elaborate. NDP Leader Jagmeet Singh has said his party would propose measures to help build as many as 500,000 affordable housing units across the country, if elected.

With more politicians tuning into the fact that the millennial generation will vote for political platforms that speak to their agenda, the 18 through 35 demographic looks as though it will soon find itself in an unfamiliar position. Instead of taking a back seat while older generations plot the course, millennials are poised to grab the wheel and take a drastic detour.

“It hasn’t boiled over yet. But, the pot is starting to get warm,” said Coletto. “There are more millennials than there are boomers. More millennials are eligible to vote than any other generation. More politicians are mindful of the shift that millennials could bring.”

Meanwhile, Barrett, is taking things in stride.

“I’ve seen a fair amount of challenges. Our generation may seem to think that we go through more. But, I think that every generation goes through some kind of hardships when it comes to finance or jobs. It doesn’t make things worthwhile if they’re just handed to you. It’s tough, but once you get what you’re going for, you appreciate it more.”

vpilieci@postmedia.com

ALSO IN THE NEWS

Millennials will overtake baby boomers as the largest U.S. population group in 2019

Antarctica is losing ice 6 times faster today than in 1980s

Millennials are no different from their baby boomer parents — they’re just poorer