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The future of New York’s middle class is at risk.
Not only is the Great Recession pushing formerly middle-class New Yorkers down the economic ladder — it’s crushing the next generation of would-be middle-income earners.
New York’s twenty-somethings are struggling to secure that first job to start a path to the middle class. Youth under 34, meanwhile, are so burdened by debt they cannot afford to aspire to the house with the white picket fence.
“It used to be that the challenge, when we talked about [young] people, was, ‘How are they going to get ahead?’” said Tamara Draut, vice president at public-policy research firm Demos. “But today it’s, ‘How are they even going to get started?’”
New York City’s unemployment rate rose to 9.7 percent last month, just as stimulus funding for summer jobs for teens dries up.
A rundown of the factors hobbling young New Yorkers right out of the gate:
* Falling wages — even for workers with a four-year college degree.
New York City workers ages 21 to 24 saw their median hourly wages drop 5 percent from 2002 to 2011.
Unemployment is so high that workers with a four-year college degree actually saw their wages drop more sharply than workers with less education, according to the Fiscal Policy Institute.
“Individual young adults have done the right thing and gone to college, but are not being rewarded for it in this labor market,” said James Parrott of the Fiscal Policy Institute.
* The highest unemployment levels in the state.
Last year, New Yorkers ages 16 to 19 faced a 24.8 percent unemployment rate. It was more than 10 percent for 20-to-24-year-olds, and 9.2 percent for 25-to-34-year-olds, well above levels for older workers.
* A larger share of college costs, which have tripled since the early 1990s.
In the last 10 years, states have shifted costs from the public squarely onto the shoulders of students, who have taken out large loans. New York’s funding per full-time-equivalent student has plunged 25 percent in the last 20 years, according to Demos. Two-thirds of recent New York college grads have an average of $25,000 in student-loan debt.
Unless New York moves to reverse these trends, the city and state will suffer.
“If folks find themselves blocked from getting into the middle class, it will manifest in budget issues and revenue collection,” said John Quinterno, a consultant who prepared a recent Demos report.