Gen-Z, Broke, Work, Retire

New Report Warns Gen Z Is Broke With No Way To Retire

A new report warns that Gen Z has no income, limiting their retirement plans and future ability to purchase a home.

A new report described a gloomy reality for Gen Z. According to new data, most Americans between the ages of 18 and 24 are broke and have no means to retire or buy a home.

The job market is mainly to blame, with many Gen Zers unable to score a job. Research from the St. Louis Federal Reserve’s Institute for Economic Equity revealed that the current economic conditions thwart the growth of this age group. According to the report, more than a third of young people are bringing in zero income.

The concept of “disconnected youth”—those who neither work nor are in school—has also grown exponentially since 1998, according to the report. Disillusioned with education and its supposed benefits, this group is facing problems with financial stability. Currently, they make up 13% of Gen Z, as reported by the Federal Reserve Bank of Dallas.

According to Business Insider, these conditions could very well delay future plans for bigger purchases. A lack of income at the beginning of early adulthood can lead to later retirement and longer rental periods. While many in Gen Z rely on family or loans to complete school, those who are not in academia struggle with financial gains.

These statistics are also worsening income inequality. Gen Zers of color already face pay gaps and structural barriers that prevent them from obtaining high-earning jobs and building wealth.

However, the publication also noted that such racial wealth gaps hinder the economy overall.

“The report confirms that even during the tightest labor market since World War II, there is a limit to economic growth’s ability to reduce ‘structural’ unemployment that many young Blacks and Latinos face, plus a growing number of young whites,” wrote William M. Rodgers III, director of the St. Louis Fed’s Institute for Economic Equity, in an email to the publication.

He continued, “The research affirms the importance of investing in young people’s physical and mental health. Otherwise, the economy can’t operate at its highest potential today or into the future.”

As unemployment rates trickle back up to pre-pandemic levels, addressing these issues holistically is critical to Gen Z’s economic survival and growth.

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