This article is part of the Forum Network series on the New Societal Contract and reflects on discussions at OECD Forum 2019 in Paris. But it doesn't stop there – wherever you are, become a member of the global Forum Network community to comment below and continue the conversation!
Millennials seem to be experiencing something of a reputational rebound at the moment. After many years of commentary on their short attention spans and penchant for overpriced avocado toast, public discussion seems to have shifted towards the distinctive challenges that this generation faces.
But among social scientists, generational analysis does not have a good reputation. The idea that being born around the same time creates essential characteristics that outweigh the impact of other sociological and economic variables just seems implausible.
And yet it’s harder and harder to deny that people born between approximately 1985 and 2000 face a unique set of economic circumstances. The price of education and the levels of debt needed to pay for it have spiralled; the prospect of permanent employment has all but disappeared; and in almost all large Western urban centres, property prices have reached levels that make renting very expensive and put home ownership effectively out of reach for many. In this context, it is really the several decades of sustained property inflation experienced in many large towns and cities that has laid the basis for a new class structure. That is the central claim of a University of Sydney research project that I am leading with my colleagues Lisa Adkins and Melinda Cooper on Asset Ownership and the New Inequality.
Although the phenomenon of property inflation has received plenty of coverage, when it comes to thinking about class, inequality and stratification more systematically we often tend to revert to older models based on work and occupation. Of course, income from work remains vitally important for many people, but the key point is that it is less and less able to serve as the basis of a middle-class lifestyle. The Millennial generation is the first to experience this reality in full force.
Of course, every generation has its story. I was born in 1975 and was supposed to be part of Generation X that struggled with the nihilism induced by a decade of conservative political backlash and was hated the babyboomer generation with a passion, processing this by curating good-looking depressions. But we graduated into the booming nineties and those of us who were lucky enough to buy a house straight out of college are now planning for early retirement.
Many of those born a decade later, in the mid-1980s, graduated with a hefty student debt and then found themselves faced with both a stagnant labour market and an escalating property market. The combination of low and precarious income, booming urban property markets and a more or less permanent student debt has proved to be toxic.
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It is of course not all that useful to understand this in terms of a clean divide between two generations. After all, many millennials have access to parental wealth that covers tuition fees, paves the way to a permanent job by funding some years of unpaid internships and then provides a down payment on a first property purchase. What we have, then, is a new logic of inequality – a new class structure – the effects of which are particularly visible when we look at the millennial cohort.
We are seeing the growing importance of intergenerational transfer and inheritance for the determination of life chances. But this is not simply a return to an older state of affairs. What is distinctive about the current era has to do with the way this logic has become bound up specifically with access to housing as a financial asset. In a recent paper, my colleagues and I have proposed a new class scheme based on assets rather than employment to capture the effects of this in the case of Sydney.
The way hyper-capitalist finance and feudal inheritance are currently mixing to shape this new logic of inequality will have implications for political legitimacy and social cohesion. The Economist is worrying about the rise of “Millennial Socialism”, while others are more worried about the possibility that social polarisation will feed into Trump-style fusions of populism and authoritarianism. These are all possibilities, as far as I can see – but before we can think about viable ways to address these problems, we need to have a far better understanding of the workings of class in the 21st century.
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