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How 33-Year-Olds, the Peak Millennials, Are Shaping the U.S. Economy

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I have covered economics for 11 years now, and in that time, I have come to the realization that I am a statistic. Every time I make a major life choice, I promptly watch it become the thing that everyone is doing that year.I started college in 2009, in the era of all-time-high matriculation rates. When I moved to a big coastal city after graduation, so did a huge crowd of people: It was the age of millennial urbanization. When I lived in a walk-in closet so that I could pay off my student loans (“The yellow paint makes it cheerful!”, Craigslist promised), student debt had recently overtaken auto loans and credit cards as the biggest source of borrowing outside of housing in America.My partner and I bought a house in 2021, along with (seemingly and actually) a huge chunk of the rest of the country. We married in 2022, the year of many, many weddings. The list goes on.I am no simple crowd follower. What I am is 32, about to be 33 in a few weeks.And there are so many of us.If demographics are destiny, the demographic born in 1990 and 1991 was destined to compete for housing, jobs and other resources. Those two birth years, the people set to turn 33 and 34 in 2024, make up the peak of America’s population.As the biggest part of the biggest generation, this hyper-specific age group — call us what you will, but I like “peak millennials” — has moved through the economy like a person squeezing into a too-small sweater. At every life stage, it has stretched a system that was often too small to accommodate it, leaving it somewhat flabby and misshapen in its wake. My cohort has an outsized amount of economic power, but that has sometimes made life harder for us.Early 30-Somethings Are EverywhereIn 2022, America had 4.75 million 32-year-olds and 4.74 million 31-year-olds, the largest two ages by population.

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    Why Are Middle-Aged Men Missing From the Labor Market?

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    Men ages 35 to 44 are staging a lackluster rebound from pandemic job loss, despite a strong economy.For the past five months Paul Rizzo, 38, has been delivering food and groceries through the DoorDash app. But he spent the first half of 2022 earning no paycheck at all — reflecting a surprising trend among middle-aged men.After learning last Christmas that his job as an analyst at a hospital company was being automated, Mr. Rizzo chose to stay at home to care for his two young sons. His wife wanted to go back to work, and he was discouraged in his own career after more than a decade of corporate tumult and repeated disappointment. He thought he might be able to earn enough income on his investments to pull it off financially.Mr. Rizzo’s decision to step away from employment during his prime working years hints at one of the biggest surprises in today’s job market: Hundreds of thousands of men in their late 30s and early 40s stopped working during the pandemic and have lingered on the labor market’s sidelines since. While Mr. Rizzo has recently returned to earning money, many men his age seem to be staying out of the work force altogether. They are an anomaly, as employment rates have rebounded more fully for women of the same age and for both younger and older men.About 87 percent of men ages 35 to 44 were working as of October, down from 88.3 percent before the pandemic struck in 2020. The stubborn decline has spanned racial groups, but it has been most heavily concentrated among men who — like Mr. Rizzo — do not have a four-year college degree. The pullback comes despite the fact that wages are rising and job openings are plentiful, including in fields like truck driving and construction, where college degrees are not required and men tend to dominate.Economists have not determined any single factor that is keeping men from returning to work. Instead, they attribute the trend to a cocktail of changing social norms around parenthood and marriage, shifting opportunities, and lingering scars of the 2008 to 2009 downturn — which cost many people in that age group jobs just as they were starting their careers.“Now, all of a sudden, you’re kind of getting your life together, and if you’re in the wrong industry …” Mr. Rizzo said, trailing off as he discussed his recent labor market experience. “I wasn’t the only one who dropped out. I can tell you that.”How male employment shifted during the pandemicMen ages 35-44 are working at a notably lower rate than before the pandemic.

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    Change in male employment rate since Feb. 2020 by age group
    Note: Three-month rolling average of seasonally adjusted dataSource: Bureau of Labor StatisticsBy The New York TimesHow female employment shifted during the pandemicWomen’s employment has rebounded across age groups.

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    Change in female employment rate since Feb. 2020 by age group
    Note: Three-month rolling average of seasonally adjusted dataSource: Bureau of Labor StatisticsBy The New York TimesMen have been withdrawing from the labor force for decades. In the years following World War II, more than 97 percent of men in their prime working years — defined by economists as ages 25 to 54 — were working or actively looking for work, according to federal data. But starting in the 1960s, that share began to fall, mirroring the decline in domestic manufacturing jobs.What is new is that a small demographic slice — men who were early in their careers during the 2008 recession — seems to be most heavily affected.“I think there’s a lot of very discouraged people out there,” said Jane Oates, a former Labor Department official who now heads WorkingNation, a nonprofit focused on work force development. Men lost jobs in astonishing numbers during the 2008 financial crisis as the construction and home-building industries contracted. It took years to regain that ground — for men who were then in their 20s and early 30s and just getting started in their careers, employment rates never fully recovered. Economists came up with a range of explanations for the men’s slow return to the labor force. After the war on crime of the 1980s and 1990s, more men had criminal records that made it difficult to land jobs. The rise of opioid addiction had sidelined others. Video games had improved in quality, so staying home might have become more attractive. And the decline of nuclear family units may have diminished the traditional male role as economic provider.Now, recent history appears to be repeating itself — but for one specific age group. The question is why 35- to 44-year-old men seem to be staying out of work more than other demographics.Patricia Blumenauer, vice president of data and operations at Philadelphia Works, a work force development agency, said she had observed a dip in the number of men in that age range coming in for services. A disproportionately high share of those who do come in leave without taking a job.Ms. Blumenauer said that age range is a group “that we’re not seeing show up.” She thinks some men who lost their blue-collar jobs early in the pandemic may be looking for something with flexibility and higher pay. “The ability to work from home three days a week, or have a four-day weekend — things that other jobs have figured out — aren’t possible for those types of occupations.”When men don’t find those flexible jobs or can’t compete for them, they might choose to make ends meet by staying with relatives or doing under-the-table work, Ms. Blumenauer said.The pandemic has probably also slowed America’s already-weak family formation, giving single or childless men less of an incentive to settle into steady jobs, said the economist Ariel Binder. On the flip side, disruptions to schooling and child care meant that some men who already had families may have stopped doing paid work to take on more household tasks.“So on the one hand you get these men who are just not expecting to have a stable romantic relationship for most of their lives and are setting their time use accordingly,” Dr. Binder said. “Then there are men who are participating in these family structures, but doing so in nontraditional ways.”Like labor force experts, government data suggest that a combination of forces are at play.A growing number of men do seem to be taking on more child care duties, time use and other survey data suggests. But a shift toward being stay-at-home dads is unlikely to be the full story: Employment trends look the same for men in the age group who report having young kids living with them and those who don’t.What clearly does matter is education. The employment decline is more heavily concentrated among people who have not graduated from college and who live in metropolitan areas or suburbs, based on detailed government survey data.An education gap among menMen without a four-year college degree have returned to work more slowly than others in the same age group.

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    Change in employment rate for people ages 35-44
    Note: Three-month rolling average of seasonally adjusted data.Source: Current Population Survey via IPUMSBy The New York TimesSome economists speculate that the disproportionate decline could be because the age group has been buffeted by repeated crises, making their labor market footing fragile. They lost work early in their careers in 2008, faced a slow recovery after and found their jobs at risk again amid 2020 layoffs and an ongoing shift toward automation.“This group has been hit by automation, by globalization,” said David Dorn, a Swiss economist who studies labor markets.That fragility theory makes sense to Mr. Rizzo.He had seen the Navy as his ticket out of poverty in Louisiana and had expected to have a career in the service until he broke his back during basic training. He retired from the military after a few years. Then he pivoted, earning a two-year degree in Georgia and beginning a bachelor’s degree at Arizona State University — with dreams of one day working to cure cancer.Then the Great Recession hit. Mr. Rizzo had been working nights in a laboratory to afford rent and tuition, but the job ended abruptly in 2009. Phoenix was ground zero for the financial implosion’s fallout.Frantic job applications yielded nothing, and Mr. Rizzo had to drop out of school. Worse, he found himself staring down imminent homelessness. His tax refund saved him by allowing him and his wife to move back to Louisiana, where jobs were more plentiful. But after they divorced, he hit a low point.“I had nothing to show for my life after my 20s,” he explained.Mr. Rizzo spent the next decade rebuilding. He worked his way through various corporate positions where he taught himself skills in Excel and Microsoft SharePoint, married again, had two sons and bought a house.Yet he was regularly at risk of losing work to downsizing or technology — including late last year. The company he worked for wanted him to move into a new role, perhaps as a traveling salesperson, when his desk job disappeared. But his sons have special needs and that was not an option.He quit in January. He watched the kids, posted on his investment-related YouTube channel and watched Netflix. He thought he might be able to live on military payments and dividend income, becoming part of the “Financial Independence, Retire Early,” or FIRE, trend. But then the Federal Reserve raised interest rates and markets gyrated.“I got FIRE, all right,” he said. “My whole portfolio got set on fire.”Mr. Rizzo, who began working for DoorDash in July, making a delivery in Kenner.Emily Kask for The New York TimesMr. Rizzo turned to DoorDash, earning his first paycheck on July 4. While he is technically back in the labor market, gig work like his isn’t well measured in jobs data. If many men are taking a similar path but do not work every week, they might be overlooked in surveys, which ask if someone worked for pay in the previous week to determine whether they were employed.Mr. Rizzo is waiting to see what happens to his DoorDash income in an economic pullback before he rules out corporate work forever. Already, other dashers are complaining that business is slowing as people have spent down pandemic savings.The veteran counts himself fortunate. He knows men in his generation who have struggled to find any footing in the labor market.“It feels like it’s the after-affects of 2008 and 2009,” he said. “Everyone had to restart their lives from scratch.” More

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    The Economy Looks Solid. But These Are the Big Risks Ahead.

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    One concern is that political leaders will mismanage things in the world’s largest and second-largest economies.The low-hanging fruit of the pandemic economic recovery has been eaten. As a result, the expansion is entering a new phase — with new risks.For months, the world economy has expanded at a torrid pace, as industries that were shut down in the pandemic reopened. While that process is hardly complete — numerous industries are still functioning below their prepandemic levels — further healing appears likely to be more gradual, and in some ways more difficult.Reopening restaurants and performance arenas is one thing. Fixing extraordinary backups in shipping networks and shortages of semiconductors, among the most vivid examples of supply shortages holding back many parts of the economy, is harder.And a range of risks, including the hard-to-predict dynamics of Covid variants, could throw this transition to a healthy post-pandemic economy off course.One looming risk is if political leaders mismanage things in the world’s largest and second-largest economies. Namely, in the United States, a standoff over raising the federal debt ceiling could bring the nation to the brink of default. And in China, the fallout from the property developer Evergrande’s financial problems is raising questions about the country’s debt-and-real-estate-fueled growth.The Organization for Economic Cooperation and Development last week projected that the world economy would grow 4.5 percent in 2022, downshifting from an expected 5.7 percent expansion in 2021. Its forecast for the United States shows an even steeper slowdown, from 6 percent growth this year to 3.9 percent next.Of course, a year of 3.9 percent G.D.P. growth would be nothing to scoff at — that would be much faster growth than the United States has experienced for most of the 21st century. But it would represent a resetting of the economy.“We’ve had liftoff, and now we’re at cruising altitude,” said Beth Ann Bovino, chief U.S. economist at S&P Global.After the global financial crisis of 2008-9, the great challenge for the recovery was a shortfall of demand. Workers and productive capacity were abundant, but there was inadequate spending in the economy to put that capacity to work. The post-reopening stage of this recovery is the opposite image.Now there is plenty of demand — thanks to pent-up savings, trillions of dollars in federal stimulus dollars, and rapidly rising wages — but companies report struggles to find enough workers and raw materials to meet that demand.Dozens of container ships are backed up at Southern California ports, waiting their turn to unload products meant to fill American store shelves through the holiday season. Automakers have had to idle plants for want of semiconductors. Builders have had a hard time obtaining windows, appliances and other key products needed to complete new homes. And restaurants have cut back hours for lack of kitchen help.These strains are, in effect, acting as a brake that slows the expansion. The question is how much, and for how long, that brake will be applied.“The kinds of growth rates we are seeing were a bounce-back from a really severe recession, so it’s no surprise that won’t continue,” said Jennifer McKeown, head of the global economics service at Capital Economics. “The risk is that this becomes less about a natural cooling and more about the supply shortages that we’re seeing really starting to bite. That may mean that economic activity doesn’t continue to grow as we’re expecting it to, as instead there is a stalling of activity and price pressures starting to rise.”The problem is that the supply shortages have many causes, and it is not obvious when they will all diminish. Spending worldwide, and especially in the United States, shifted toward physical goods over services during the pandemic, more quickly than productive capacity could adjust. The Delta variant and continued spread of Covid has caused restrictions on production in some countries. And the lagged effects of production shutdowns in 2020 are still being felt.Then there are the risks that lurk in the background — the kinds of things that aren’t widely forecast to be a source of economic distress, but could unspool in unpredictable ways.Debt ceiling brinkmanship in Washington is a prime example. Senate Republicans insist that they will not vote to increase the federal debt limit, and that Democrats will have to do so themselves — while also planning to filibuster Democratic attempts to do so. Failure to reach some sort of agreement would risk a default on federal obligations, and could cause a financial crisis. For that reason, a deal in these cases has always ultimately been done — even if, as in 2011, it created a lot of uncertainty along the way.The risk here is that both sides could be so determined to stick to their stances that a miscalculation happens, like two drivers in a game of chicken who both refuse to swerve. And to those who are closest to American fiscal policymaking, that looks like a meaningful risk.“Chances of a default are still remote, and Congress will likely increase the debt ceiling. but the path to a deal is more murky than usual,” said Brian Gardner, chief Washington policy strategist at Stifel, in a research note. He added that the political game of chicken could spook markets in coming weeks.And on the other side of the Pacific Ocean, the Chinese government has its own challenge, as Evergrande struggles to make payments on $300 billion worth of debt.Real estate has played an outsize role in China’s economy for years. But few analysts expect the problems to spread far beyond Chinese borders. The Chinese banking and financial system is largely self-contained, in contrast to the deep global linkages that allowed the failure of Lehman Brothers in 2008 to trigger a global financial crisis.“Everyone’s learned a trick or two since 2008,” said Alan Ruskin, a macro strategist at Deutsche Bank Securities. “What you have here is the world’s second-largest economy, and one that has lifted all boats, could be slowing more materially than people anticipated. I think that’s the primary risk, rather than that financial interlinkages shift out on a global basis.”All of which could make for a bumpy autumn for the world economy, but which in the most likely scenarios would lead to a solid 2022. If, that is, everything goes the way the forecasters expect. More

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    Ghosts of 2009 Drive Democrats’ Push for Robust Crisis Response

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    #masthead-section-label, #masthead-bar-one { display: none }The New WashingtonLatest UpdatesExpanding Health CoverageBiden’s CabinetPandemic ResponseAdvertisementContinue reading the main storySupported byContinue reading the main storyNews AnalysisGhosts of 2009 Drive Democrats’ Push for Robust Crisis ResponseIn their quest for Republican backing, Democrats say they missed opportunities in 2009 for a stronger response to the Great Recession. They are determined not to repeat the mistake.Senator Chuck Schumer of New York, the new majority leader, at the Capitol on Wednesday. “We should have learned the lesson of 2008 and 2009, when Congress was too timid and constrained in its response to the financial crisis,” he said last week.Credit…Oliver Contreras for The New York TimesJan. 31, 2021Updated 5:27 p.m. ETWASHINGTON — Ten Republican senators asked President Biden on Sunday to drastically scale back his $1.9 trillion pandemic aid bill, offering a $600 billion alternative that they said could pass quickly with bipartisan support.But their proposal met a tepid reception from Democrats, who are preparing this week to move forward with their own sweeping package — even if it means eventually cutting Republicans out of the process. Haunted by what they see as their miscalculations in 2009, the last time they controlled the government and faced an economic crisis, the White House and top Democrats are determined to move quickly this time on their stimulus plan, and reluctant to pare it back or make significant changes that would dilute it with no certainty of bringing Republicans on board.“The dangers of undershooting our response are far greater than overshooting,” said Senator Chuck Schumer, Democrat of New York and the new majority leader. “We should have learned the lesson of 2008 and 2009, when Congress was too timid and constrained in its response to the financial crisis.”Their strategy can be traced to 12 years ago, when Barack Obama became president, Democrats controlled both houses of Congress, and they tackled both an economic rescue package and a sweeping health care overhaul.In retrospect, in the quest to win Republican backing for both, Democrats say, they settled for too small an economic stimulus and extended talks on the health care measure for too long. That view was driving the party’s unenthusiastic response on Sunday to the new offer from the Senate Republicans who asked for a meeting with Mr. Biden to lay out a substantially smaller stimulus proposal. In a letter, the 10 senators — notably enough to defeat a filibuster — said their priorities aligned with Mr. Biden’s on crucial areas such as vaccine distribution.But members of the group made clear in interviews on Sunday that their plan amounted to less than a third of Mr. Biden’s proposal. Democrats said they would review it, but would insist on a comprehensive legislative response.While talks with Republicans are expected to continue, Democrats are set this week to put in motion a budget process known as reconciliation that is not subject to a filibuster, allowing them to push through pandemic legislation on their own if no bipartisan agreement emerges.That possibility has Republicans squawking that Democrats are abandoning their bipartisan pledge without giving it a chance and warning that the effort will poison their ability to reach bipartisan deals. The objection ignores the fact that when they controlled Congress, Republicans rolled over Democrats in January 2017 and began their own reconciliation process even before Donald J. Trump was sworn in as president, paving the way for the enactment of a $1.5 trillion tax package that was muscled through without a single Democratic vote.“We’re giving an opportunity to come together on important and timely legislation, so why wouldn’t you do that rather than trying to move it through with reconciliation and having a fully partisan product?” asked Senator Lisa Murkowski, Republican of Alaska and one of the signers of the new letter.While they have yet to roll out their plan, members of the group said it would omit Democrats’ proposal for a federal minimum wage increase and scale back direct stimulus payments to individuals, excluding Americans earning more than $50,000 a year or families with a combined income exceeding $100,000.“Let’s focus on those who are struggling,” Senator Rob Portman, Republican of Ohio, said on the CNN program “State of the Union” on Sunday.But to Democrats, the scars from 2009 cut deep. First, they believe they were too accommodating to Republicans, who called for restraint in providing stimulus for the economy. Then Democrats saw themselves as sandbagged by Republicans who engaged in prolonged negotiations over health care before pulling the plug entirely, opposing legislation that they had helped draft and inflaming a partisan fight that cost Democrats dearly in the 2010 midterm elections.This time, Democrats say the new aid must be robust and delivered quickly. They do not intend to allow Republicans to dictate the timing nor the reach of the legislation.“I’m not going to let Republican senators stall for the sole purpose of stalling,” Senator Ron Wyden, Democrat of Oregon and the incoming chairman of the Senate Finance Committee, said on a conference call hosted by the advocacy group Invest in America. He added that his view grew out of his own experience serving as a junior member of the panel during the Great Recession.Mr. Biden would no doubt prefer to push his proposal through with bipartisan support to show he is able to bridge the differences between the two parties. But the White House has been adamant that it will not chop up his plan to try to secure Republican backing and that while the scope could be adjusted, the changes will not be too substantial.“We have learned from past crises that the risk is not doing too much,” Mr. Biden, who was vice president in 2009, said on Friday at the White House, striking the same theme as Mr. Schumer. “The risk is not doing enough.”Like Mr. Biden this year, Mr. Obama entered the White House in 2009 optimistic he could cooperate with Republicans, and there had been promising signs in 2008. In the face of a dire economic emergency, congressional Republicans, Democrats and George W. Bush’s administration had worked closely to approve the $700 billion Wall Street bailout. Republicans also seemed dispirited by steep election losses in November, suggesting some might be open to cooperation.But to an extent that was not immediately apparent, top Republicans in the House and Senate quickly decided that their best path to reclaiming power was to remain united against Mr. Obama’s agenda, a stance Republicans later acknowledged.As a result, the administration and Democratic leaders had to make multiple concessions to ensure the votes of three Republicans and a few moderate Democrats needed to provide the bare minimum of 60 votes to overcome deep Republican opposition to the stimulus package. That meant holding the amount to $787 billion, less than what some economists at the time said was needed, and potentially slowing the recovery.President Obama speaking about health care in 2009. Democrats say they settled for too small an economic stimulus to gain needed Republican support while also extending talks on health care for too long.Credit…Stephen Crowley/The New York TimesThen came the health care law. Democrats were determined to both expand access to affordable health insurance and to work with Republicans in doing so. They were also concerned then about repeating past mistakes, particularly the Clinton health care effort in 1994, whose spectacular collapse was attributed partly to a failure to involve Republicans from the start.While many Republicans were considered out of reach in 2009, a group of three senators influential on health care policy — Charles E. Grassley of Iowa, Mike Enzi of Wyoming and Olympia Snowe of Maine — engaged in lengthy negotiations with three Democratic counterparts, in a group that came to be known as the Gang of Six.To bring them along, Democrats proposed a market-based approach rather than the kind of government-run, single-payer program sought by many liberals. They even eschewed a limited public option to mollify Republicans and some moderate Democrats. Still, the talks dragged, and Republicans began pulling back amid a rash of raucous protests at congressional town hall events across the country.Frustrated and believing Democrats were being strung along, Mr. Obama in September 2009 summoned Mr. Grassley to the White House along with Senator Max Baucus, Democrat of Montana, who was leading the Gang of Six.Mr. Obama recounted the scene in his new memoir, writing that he had pressed Mr. Grassley on whether, “if Max took every one of your latest suggestions, could you support the bill?” Mr. Grassley was hesitant. “Are there any changes — any at all — that would get us your vote?” Mr. Obama asked, drawing what he described as an awkward silence from the Republican senator.“I guess not, Mr. President,” Mr. Grassley eventually responded.As they plunge forward this year, Democrats say they do not want to find themselves in a similar position, working with Republicans only to come up short with an insufficient response that does not draw bipartisan support.Some Democrats still hold out hope of reaching bipartisan agreement on at least some elements of the administration’s coronavirus response and say the party must make a legitimate attempt to come together with Republicans.“We ought to try to do what we can do in a bipartisan way,” Senator Joe Manchin III of West Virginia, a leading Democrat in the bipartisan talks, told reporters. He said it would then be appropriate for Mr. Schumer to use “other means to move things along” if progress could not be made.Emily Cochrane More