If a recession is coming, what will it mean for young people?
There’s something about the word “recession” that brings fear to anybody, regardless of age or general knowledge of anything to do with economics. I remember first learning vaguely what the term meant when I was 9 years old in one of those rare moments where a TV inside of McDonald’s was useful.
On the TV, President George W. Bush gave a press conference sad enough to ruin any happy meal when he warned of the regressing gross domestic product. General murmurings filled the restaurant, prompting me to ask my mother what a recession was.
Well, it means we won’t be eating at McDonald’s anymore.
My stomach dropped. I wasn’t ready to give up McDonald’s or any of the other luxuries that I valued as a 9-year-old, which at the time consisted of my broken GameCube that we had to keep a book on top of in order for the disc to play, our recently moved-in-to house and the TV.
We didn’t have a lot growing up, but like Anderson .Paak sang, “Mama always kept the cable on.” Thankfully we were able to navigate the Great Recession without cutting our cable, but like other families, we lost thousands of dollars. Thankfully, my parents didn’t lose their jobs, but many did: the unemployment rate more than doubled to 10% very quickly after the recession according to the Bureau of Labor Statistics. That number was even higher for people of color, with black unemployment peaking at over 15%.
Like many other Americans during the recession, my mom had a considerable amount of credit card debt, a debt that was accumulated when she was trying to raise my brother and I as a single mother. According to a New York Fed Consumer Credit Panel report, credit card debt made up the highest percentage of debt among delinquent borrowers, higher than student loans and mortgages. A delinquent borrower is someone who fails to make a payment toward their account for 90 days.
The recession ruined families, devastated communities, and changed the country’s political and economic makeup. Some still haven’t recovered from the country’s biggest economic crisis since the Depression.
Murmurings of a looming global recession are starting once again, and though President Donald Trump has yet to say a recession is coming, he admits that the country’s trade war with China could lead to one.
Our country certainly isn’t the only one contributing to the possible global recession. The Economic Policy Uncertainty Index compiled by professors from Northwestern, Stanford and the University of Chicago attributed “political turmoil” in some of the world’s largest economies, such as the United Kingdom, South Korea, and America. Because of the uncertainty of these large markets, global economic uncertainty has risen to a level 50% higher than it was at the peak of the Great Recession.
The economy is certainly different than it was just a decade ago. The market is more digitally focused, with startup businesses taking to the internet to attract micro investments and donations. Businesses are transitioning to digital-first marketing strategies to reach previously less accessible audiences.
However, even though it is a general consensus that the market of the future is digitally based, it doesn’t mean any online business venture is guaranteed success. This is leading young people to give up on pursuing a career they’re passionate about in favor of something that is more sustainable and lucrative.
According to that same New York Fed report, young people are set to be hurt the most by a recession. Among people who fail to make a payment toward their debt after 90 days, debt makes up 4% of the total balance of 18-29 year olds accounts, more than 1% higher than any other age group. Currently student loans make up the highest percent of delinquent borrowers’ debt.
Perhaps what resonated most with the generation that grew up during the Recession was the fear that infected our narrow vision and understanding of the world around us. Alongside the war on terror and partisan politics, we were raised in an era of economic turmoil, and our generation is somewhere in the middle of uncertain and skeptical that we will ever live in the America we were promised.
Our generation, the most diverse this country has ever seen according to Pew Research Center, knows our country cannot thrive, socially or monetarily, if we focus on what divides us rather than what unites us: our common goal for liberty and opportunity for all.
