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Below is a complimentary excerpt from a Demography Unplugged research note written by Hedgeye Demography analyst Neil Howe. Click here to learn more and subscribe.

Millennials Lose Their Fabled Economic Optimism - 4 29 2020 10 08 44 AM

According to a new Pew study, just 23% of Americans believe that the economy is doing well. At the same time, the majority of people expect things will be better a year from now—but this doesn’t include those under 30, who are considerably less optimistic than older Americans. (Pew Research Center)

NH: Across the board, Americans’ views of the economy have nosedived with stunning severity. A mere 23% say that economic conditions are excellent or good, compared to 57% back in January. Most people now say that things are “fair” (38%) or “poor” (38%). Opinions on economic conditions are far less divided than they were prior to the outbreak, with differences in views by income level, education level, and political affiliation shrinking considerably.

There’s also widespread support for federal aid measures: Fully 88% of Americans back the stimulus package that was enacted last month, while 77% believe that it will be necessary for the government to provide additional assistance. Both Democrats and Republicans are much more united in expanding the role of government today than they were back in 2009.

So there’s general agreement about where we are. Views diverge, however, when people are asked about the future. Most Americans (55%) believe that things will be better a year from now; only 22% think it will be worse. But there’s a huge age gap here. Optimism about the economy decreases steadily moving down the age ladder: Fully 69% of those 65 and older think things will be better. Among 50- to 64-year-olds, it’s 59%; 30- to 49-year-olds, 52%; and 18- to 29-year-olds, just 42%.

A recent WSJ/NBC News poll points to a similar divide. The youngest voters (age 18 to 34) were the least likely to say that the economy is doing well and the most likely to have experienced some kind of economic shock due to the pandemic, such as losing a job or having their pay cut. They’re the least likely to be satisfied with the government’s response. And while about three-quarters of the public say that the crisis is bringing out the best in America, less than half of this group feels the same way. (See "Millennials Can Get Through This Crisis.")

I recently talked about how Millennials are in the unenviable position of facing their second big economic crisis. (See “This is Not Millennials’ First Economic Crisis Rodeo.”) There I ended up focusing more on Gen Xers, because I think they tend to get overlooked in these discussions. We’re deluged with coverage on Millennials’ economic woes--see, just in the past two weeks, WSJ, Bloomberg, The Economist, and these two essays from The Atlantic. But well, it’s true. It gets a lot of coverage because it hits a nerve with readers. And I think there’s something to this generation’s cynicism about the future that isn’t just about what they’re experiencing financially. 

Millennials are facing serious economic problems. But they’re also frustrated by the lack of leadership from a system they expected so much more from. Here we have a generation of young people who are inclined to help, who could really step forward and shine in a crisis, but they have nothing to do. There’s little sense of solidarity or mobilization coming from the top. When the U.K. asked for 250,000 volunteers to help the National Health Service recently, more than 750,000 signed up to bring groceries and supplies to elderly neighbors.

We need something like that here--not only because it would be a big help to our communities, but because it would instill a much-needed sense of pride and purpose among young people who want to act, but have no obvious place to put their energy or their time.

Millennials Lose Their Fabled Economic Optimism - millenial1

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Neil Howe is a renowned authority on generations and social change in America. An acclaimed bestselling author and speaker, he is the nation's leading thinker on today's generations—who they are, what motivates them, and how they will shape America's future.

A historian, economist, and demographer, Howe is also a recognized authority on global aging, long-term fiscal policy, and migration. He is a senior associate to the Center for Strategic and International Studies (CSIS) in Washington, D.C., where he helps direct the CSIS Global Aging Initiative.

Howe has written over a dozen books on generations, demographic change, and fiscal policy, many of them with William Strauss. Howe and Strauss' first book, Generations is a history of America told as a sequence of generational biographies. Vice President Al Gore called it "the most stimulating book on American history that I have ever read" and sent a copy to every member of Congress. Newt Gingrich called it "an intellectual tour de force." Of their book, The Fourth Turning, The Boston Globe wrote, "If Howe and Strauss are right, they will take their place among the great American prophets."

Howe and Strauss originally coined the term "Millennial Generation" in 1991, and wrote the pioneering book on this generation, Millennials Rising. His work has been featured frequently in the media, including USA Today, CNN, the New York Times, and CBS' 60 Minutes.

Previously, with Peter G. Peterson, Howe co-authored On Borrowed Time, a pioneering call for budgetary reform and The Graying of the Great Powers with Richard Jackson.

Howe received his B.A. at U.C. Berkeley and later earned graduate degrees in economics and history from Yale University.