Not Quite Adults: Why 20-Somethings Are Choosing a Slower Path to Adulthood, and Why It’s Good for Everyone

by Settersten, Richard; Ray, Barbara E.

  Monica bounced to a collection agency and then to a mortgage foreclosure firm, a job she held for less than a year. She is once again unemployed and looking for that perfect fit. But the constant shifting and searching are taking their toll. “I have my days where I feel a little panicky that I’m not going to find a job,” she says. “I’m thinking maybe if I go back and take a proofreading class or an editing class and a refresher English course. I don’t know … I want a job I am going to be at for a long time, and I’m afraid that I am not going to find it.”

  On the one hand, Dustin and Monica and their fellow twenty-somethings have absorbed the credo of high aspirations and the importance of finding ideal, meaningful jobs. On the other hand, they do not have the credentials, connections, or leverage necessary to catapult themselves into this bracket of entrepreneurs, software programmers, engineers, patent lawyers, and other highfliers. While it has always been the case that not everyone is cut out for the professional, white-collar class, what is different today is that the blue-collar jobs are shrinking and are paying less. Those young adults who cannot bear the thought of another day in a classroom after high school have fewer “good” options today than their parents. Their piece of the pie—the assembly lines, the trades, the shipyards and airplane hangars—has shrunk, leaving more of them to fight for the lower-paying service sector or non-union jobs. They are often forced to piece together a string of jobs, with the hope of finally landing one that meets their expectations, or at least pays enough to cover the bills.

  The service sector, broadly defined, is by far the largest today. In 1979, 28 percent of the U.S. workforce was in goods-producing jobs, such as construction or manufacturing. By 2005, only 17 percent held such jobs. Meanwhile, the share working in the service industry (including the higher-paid industries of finance and computers) increased from 72 to 83 percent.8 Not all of these service jobs are low paid and low skilled. The service sector also officially includes high-paid professionals like lawyers, programmers, and movie stars. However, this sector has only a very small middle tier—workers are either highly paid, like financiers, or they are very poorly paid. In discussing the service sector here, we are thinking about this bottom tier of clerical workers, janitors, delivery drivers, teacher’s aides, and the like. This tier made up about 50 percent of the service sector in 2005.

  For lower-paid work, hours are less stable, jobs more often involve evening and night shifts, and they are more often part-time. Take Sheila, the mother of three who babysits for three children in addition to her own so that she can balance work and family more easily. The pay is paltry—$360 a month—but she needs the work. With just a high school degree, she relies on the service sector to supplement her husband, Tony’s, equally meager wages. Since age eighteen, Sheila has held a string of low-wage jobs, including fast food worker, waitress, data entry clerk at a dental clinic, and nursing home aide. She and a friend even started their own housecleaning business a few years back, but they had a falling-out, which ended that option. She tried to go out on her own, but “I sent [out flyers] and nobody called. It was just not time.”

  Franco, a twenty-seven-year-old married father of two, delivers cigarettes, tobacco, candy, and groceries to small grocery stores and hotels in New Jersey fifty-seven hours a week. The job pays $12.50 an hour with benefits, and he pulls in about $2,000 a month after taxes. For him, “it’s enough to live on if you live a conservative life and, you know, you don’t buy a Mercedes or something like that.” But if he had his choice, “I would like to have an eight-hour job that pays me more, so I don’t have to work all them hours. Maybe I could go from eight till four and come back home and have more time with my kids.”

  Hand in hand with the rise of the service sector and the more “contingent” workforce is the growth in part-time jobs, particularly for young adults. In 2008, 30 percent of young adults ages twenty through twenty-four were working part-time.9 Along with part-time work is the rise of temporary workers. One-half of the temporary services workforce is under age thirty-five (versus 36 percent of the permanent workforce), and they typically earn $3 an hour less than the median wage. In these jobs, the workers are employed by temporary agencies, not the companies where they are actually working. This saves employers from paying benefits or sometimes even the prevailing wage at the company. Between 1995 and 2004, total private employment in temporary help services grew by 43 percent, while total private employment overall grew 14 percent.10 Only one-third of temporary workers preferred this arrangement.11

  Our treaders struggled to find good jobs before the recession. It will be even harder for them now. As of April 2010, amid a stubborn recession, the unemployment rate for those ages twenty through twenty-four stood at 17.2 percent, much higher than the national average. Many in this group lacked college degrees. Job opportunities are very sparse for these young people. Older workers are clinging to their jobs longer because their retirement accounts have dwindled with the plummeting stock market (another ramification of the do-it-yourself employment contract: More workers now rely on 401(k)s for their retirement). And adding to their misery, their peers with college degrees will begin competing for their jobs as well. While the college-educated are more recession-proof than most, in a sign of the times, a growing portion of college grads are holding jobs that do not technically require a college degree, according to Andrew Sum, the director of the Center for Labor Market Studies. The result: The young, the poor, and the poorly educated are out on their ear.

  “Where do you want to be in five years?” we asked Peter, the twenty-two-year-old New Yorker who had “some” college before the current downturn. “I have no idea,” he says. “A lot of people have jobs just to pay the bills. What I want to do—I want to do something that I like. I don’t want to be in a situation where [I’m saying] ‘I hate this job.’ ”

  The question is, will Peter have the privilege of choosing the dream job that he loves? Or will his high expectations slam up hard against the reality of his narrow prospects? His job history in low-wage retail offers him little to fall back on. In his current job as an errand runner, he earns around $250 a week, hit or miss—or $12,000 a year with no benefits.

  Like so many of the twenty-somethings we interviewed who do not have college degrees, Peter has absorbed the credo of high aspirations and the importance of meaningful work. He continues to seek a job that matches his goals and pays the bills. Young adults in their early twenties change jobs every year, and those in their late twenties and early thirties change jobs every three years.12 This translates into nine jobs by the time a person reaches thirty-four. However, for treaders, this job-hopping does not always lead, like that of their above-average peers, to a better job. Nor is it always voluntary. Lower-wage workers change jobs more often because of limited opportunity and vanishing on-the-job training, as well as circumstances beyond their control. Tyler, the young Minnesotan who dropped out of college after floundering badly, would start in a company, begin to move up, and then the business would close or he would be laid off. “Maybe it caught some people by surprise, but I kind of saw it coming,” he says. “You just come to expect it.”

  This instability in the twenties is a dress rehearsal for the next decade, and probably the decade after that. These young people are on their own to figure out their work path, and the road signs keep changing. The likely result: lots of job-hopping, and a lifetime of insecurity instead of a lifetime job. This is hard on families and hard on a national economy. Add to this built-in job insecurity the higher expectations for jobs and work, and we have the makings for a disappointed, disillusioned, and increasingly partitioned workforce (and society). Although America’s workforce has always been divided by blue and white collars, the blue-collar worker was offered a trade-off for doing the kind of job that required a shower after work, not before. That trade-off was good pay, solid benefits, and job security. That trade-off has all but disappeared.

  A Fast Start to Nowhere

  At a small fo
od-processing plant in Blakely, Georgia, workers toiled long hours to make peanut butter. The small warehouse employed hundreds instead of the thousands that the Bethlehem Steel plant in Gary, Indiana, and its ilk once did. To make a profit, the plant imported cheap peanuts from Mexico and South America and paid its non-unionized workers minimum wage. It also relied on temporary workers to save on back-office personnel costs. A shift supervisor at the plant was topping out at $12 an hour, or approximately $22,000 a year, according to a New York Times article in February 2009. At age thirty-one, he could not afford health insurance for his two children. The workers had gone several years without a raise. This is all in the past tense, however, because the plant joined the ranks of many manufacturers when it closed its doors in late 2009.

  The shift away from a manufacturing base toward a knowledge and service economy is one reason for the sinking fortunes of many of the young people outlined here, and the starkly divided job world. Beginning in the early 2000s, wages in the service and manufacturing sectors began to converge. This was not because, as some had hoped, wages in the service sector grew, but because wages in the manufacturing sector fell.

  A key milestone on the road to adulthood is that first “real” job. Yet the wages of these first jobs have been deteriorating steadily for the least educated. Young adults ages twenty-five through thirty-four with just a high school degree could expect entry-level wages of $11 an hour for males and $9 an hour for females in 2005. Their peers with a college degree were making about $20 an hour in their first job. In fact, as Sheldon Danziger and Cecilia Rouse show in their Network book The Price of Independence: The Economics of Early Adulthood, high school dropouts haven’t seen their wages increase for twenty-five years, and those with just a high school degree were earning only 7 percent more.

  These stagnating wages and the shift away from well-paid manufacturing and into fewer unionized and more service sector jobs takes a toll on our country’s overall economic security. Danziger and Rouse find that in 1969, only about 10 percent of men in their early thirties were low earners, in this case earning poverty-level wages. By 2004, that share had more than doubled. Women fared a little better over the same time span, but nearly half of all women were still earning poverty-level wages in their midthirties. “The most recent generation of workers is taking much longer to earn enough to support a family,” they write in the introduction to their book, “and at every age, young men are now less likely to do so than their counterparts were a quarter-century ago.”13

  This struggle to find a steady, well-paid job is particularly worrisome. Promotions and raises in the early years of work set the stage for the rest of one’s work life. Workers experience the most wage growth during the first ten years of work. In fact, three-quarters of men’s wage growth occurs in their first ten years of work. This front-end wage growth is also typically what carries the worker through the rest of the career.14 While the treaders are making their wages in lower-paid, part-time or temporary jobs—errand running, small manufacturing, retail, and others—their more credentialed peers are logging hours in a profession or a job related to their field. All this adds up to growing insecurity, lower wages, a workforce always on the brink, and a longer road to the other markers of adulthood—marriage, kids, house and home.

  Down and Disconnected

  Most young adults today face a similar struggle, regardless of where they have their sights aimed. Those with the stellar credentials and those with nothing more than a technical degree or a few courses at the community college under their belt are all struggling to find the right match between their ideas about work and the reality before them. Those in the mid- and bottom tiers, however, will likely struggle much longer as their ambitions butt up against an economy that offers nothing remotely resembling what these young workers might have imagined for their lives. Working less for more pay in professional jobs may be what they think they can do, but the reality is quite different.

  Since young adults with at least some college are struggling to stay afloat, one can imagine how those without any training or even a high school degree are faring. This is a group of young people who, by their early to midtwenties, have already checked out. They are adrift, often not hooked into school, work, or the military. In what is now a popular word in social service circles, they are disconnected. “Their life is clearly not going so great at this point,” says Network member Wayne Osgood, the author of On Your Own Without a Net. “They don’t have much going on in the world of work; many are living at home with their parents, and even in some kind of trouble.”

  The number of young people nationally who are completely disconnected and on the brink of sinking before they even get started is alarming. Osgood estimated that among the twenty-four million twelve- to seventeen-year-olds in 2005, at least a million and a half would completely disconnect along the road to adulthood. They would reach twenty-five without a job, without being in school, and without the ability to live on their own without family or government support. More alarming: These numbers have been growing steadily over time. The actual numbers of disconnected young people are probably higher because these tallies exclude those who are sent to prison. For black men, the numbers are shocking. More than one-half of young black men ages sixteen through twenty-four are neither in school nor working. The reasons for the disparity between black and white young men are many, and include a very different set of advantages and blocked opportunities. While lack of education is a common obstacle for both white and black men who are struggling to get started in life, black men have the added burden of racism, greater social isolation in inner cities, and an all-too-tempting drug and gang trade that quickly fills the void of lost jobs.

  At an age when most young adults are beginning in earnest to forge the connections to adulthood, this group of disconnected youth is at risk of not only floundering personally, but facing protracted bouts of unemployment going forward. They will probably become caught in a vicious cycle between spells in prison and time back at home. Women in this group are likely to have a child by age twenty-five, and to rely on what little is left of the public safety net. Most will struggle to stay one step ahead of poverty. This group’s plight imposes severe social costs, not to mention the personal costs of lost potential, as well as the intergenerational legacy.

  These disconnected youth may be a harbinger of things to come. Many young adults, not just those who are disconnected, will no doubt work diligently to find a job, and another, and another. But without a sense of stability and the possibility for a brighter future, it becomes hard to plan a life, marriage, and kids. Life quickly becomes discouraging, and anger builds. How long before one gives up and drops out? How long before someone or some organization taps into this growing resentment with tea parties and angry community town halls? How long before the resentment boils over?

  Americans have historically pulled themselves up by their bootstraps, relying on hard work and perseverance to compensate for disadvantages. Young adults today still believe in the value of hard work. In fact, in an analysis of a national survey commissioned by the Network, young adults said that one of the most important values they hope to instill in their children is a strong work ethic.15 In our interviews in all quarters of the country, young adults also talk proudly of their work ethic.

  But the work game is stacked against too many young people in low-level jobs. No matter how hard they work, without more education their options will be limited and their incomes are unlikely to ever rise beyond $40,000 a year. Without better credentials, they will float in a world of part-time work, temporary work, or roving from one low-paid job to another.

  Though treaders hold many of the same ideals as swimmers, swimmers are buffered by their degrees and their family backgrounds. But they are also in no position to cavalierly quit their jobs in pursuit of the dream job. They cannot afford to meander because, in the end, they are more vulnerable than they think. They can no longer take a middle-class life for granted, and they ar
e but one short step from plunging a long way down.

  We end at what is by now a familiar picture. Those with more credentials, more education, and a better springboard will likely succeed in this world of work. They may take a longer path to that perfect job, and they may very well collide with the reality of a workforce that tends to squash ideals like work–family balance and jobs that give back. Or this generation may be the one that begins to change that reality. Their idealism is often combined with a self-assurance and set of credentials that might just be the ticket to change. They could be the generation that demands more work–life balance and gets it, the generation that jumps off the rat race of “always on” work schedules and seventy-hour-plus workweeks. They may just be able to turn the tables on the race for more money and more prestige at any cost. More likely, however, are the odds that they will join the race and become the future innovators, entrepreneurs, designers, and programmers who will inch the country forward with new ideas and new products.

  But this is a tiny group. A much larger group will face the reality of a very different economy that does not always allow for the luxury of choice. Those with fewer credentials—and they are the majority, not the Jon Favreaus of Obama speechwriting fame and other highfliers—will likely continue to struggle and do less well than their parents did, a first for this country. Their dreams of a fulfilling job will turn sour quickly. There has always been a successful group and a less successful group in the U.S. workforce. But what is different now is the size of the gap between those in the creative culture and those in the service sector. Without some new solutions and some better paths from school to work, some of which we discuss in the concluding chapter, this group of treaders risks lifelong struggle, teetering forever on the brink. The middle will hollow out, and the center will eventually collapse.