"The Lost Generation": Goldman Unemployment Charts Explain Just How Spoiled Millennials Are

Tyler Durden's picture

This morning, Goldman's Econ team, led by Jan Hatzius, set out to identify why wage growth has been elusive despite the fact that unemployment rates and other labor utilization measures signal an economy at full employment.  For evidence of labor market 'slack' they decided to take a look at how recessionary college graduates handled the post-recession labor market as their lack of skills often make them the most vulnerable to a weak job market.

While the unemployment rate and other labor utilization measures signal an economy at full employment, wage growth has been weaker than expected recently, raising questions about the true degree of slack. To the extent that some pockets of excess slack remain, the cohort that came of age during the Great Recession would seem a natural place to ?nd it, given the pronounced and long-lasting effects of recessions on young workers.


In today’s daily, we review the labor market experience of the cohort graduating college or beginning careers during or immediately after the recession. Unsurprisingly, unemployment rose sharply in this segment from 2007 and 2010. However, since then, jobless rates have improved dramatically on both an absolute and relative basis – particularly over the last year – and the unemployment rate in this cohort is now under the national average. Relative wages have also partially recovered, and broader measures of utilization suggest that minimal excess slack remains in this cohort.

While not terribly surprising, they found that the young folks who graduated in the immediate aftermath of the 'Great Recession' suffered relatively steep wage degradation relative to the overall population. 

Average earnings trends in the household survey show a similar pattern of underperformance and subsequent recovery. As shown in Exhibit 3, usual weekly earnings in this cohort declined by 6% relative to the population during and after the recession (on an age-adjusted basis). However, despite a partial recovery, the earnings gap remains: relative wages on this basis have only retraced a third of the post-recession decline (qualitatively consistent with the predictions of the academic literature).


But what is surprising is why those wages haven't recovered meaningfully despite the fact that unemployment rates among the same cohort have fallen precipitously.  


And while Goldman didn't point this out, perhaps there are some interesting, if overlooked, clues in the following two charts that lend some insight into the behaviors and attitudes of the current millennial generation as compared to previous generations that came of age during previous recessionary periods.


The chart on the left is particularly telling if you just compare the 1981 recession to 2008.  In the immediate aftermath of the recession, the unemployment gap for young people declined in both instances for the first 4 quarters of the recession. 

That said, the experience beyond Q4 is quite different as the 1981 cohort experienced a massive surge in employment while millennials in 2008 simply continued to decline and only bounced slightly off the lows.  Now, one could say this is an unfair comparison because the 2008 recession was deeper and more protracted than the 1981 recession. But, what we find most intriguing is that the 1981 cohort saw a massive surge in employment despite suffering the greatest wage decline of any of the recessionary periods for the past 35 years, and nearly double the experience of the 2008 recession.

Translation, when recession struck in 1981, Baby Boomers and Generation X got off their asses and took any job at any wage they could find to make ends meet.  But, when recession struck in 2008, millennials simply moved in with mom as opposed to taking a job that didn't fully reward their extensive skillset garnered from 4 years of rigorous anthropology studies at a preppy New England liberal arts college.

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ACP's picture

Muh sociology degree.

Muh women's studies degree.

Muh PhD in tranny studies.


Edit: Hasn't been a major terrorist attack in weeks? What gives?


johngaltfla's picture

That generation is clueless as to why a degree in Transgender Mauritanian 17th Century Art won't get them a position in management.

Oh, and the requirement of showing up for work.

NoDebt's picture

The economy can only absorb so many waiters and bartenders with a college degree.  

I'm not sure if anybody has noticed, but ALL of the jobs generated since the GFC have been low-paying capuccino foam jobs.  Tell me exactly the leverage people in these jobs have to demand higher pay.



armada's picture

Sure, Blame the Millennials. When the Bankers ruined the country and destroyed our money. http://wp.me/p4OZ4v-2GY

Son of Loki's picture

When I was job hunting in the STEM field, not one of my prospective employers asked me if I had taken a course in 'scoial justice" or "how to idenitfy and deal with white privilege."

Not one.

NidStyles's picture

A Goldmanite calling anyone spoiled is absolutely absurdity in speech.

Lets see bankers provide value to society first.

Victor von Doom's picture

Subnote: Hell will freeze over first.

VZ58's picture

No, those courses are now prerequisities imposed by universiy administrations needing to maintain a steady fodder of virgins for the SJW courses taught by middling professors that populate academia in the social sciences. Only those heading for carriers at the Huff Post, CNN or Google, Yahoo, FB etc. take these couraes voluntarliy.

johngaltfla's picture

Weird. The courses I was "forced" to take were English Lit, Classical Music, and Western Lit. I guess teaching the historical origins of the West is now forbidden as after all, the source of all of the world's problems is that evil white man which emigrated from Europe and killed all them thar natives worldwide as they colonized the planet.

DollarMenu's picture

So, if you search ZH for "phony unemployment statistics", you will find many threads about how the real unemployment rate is multiples of the gov't rate.

How do those observations square with the oness given in this article?

Could it be possible that there are just no jobs besides coffee and burgers?

The engineering and tech job providers are screaming for more H1B visas, so they don't have to pay real wages; something also discussed here..

What is the real story here?

Is this just click-bait for kid haters?

Ms. Erable's picture

I'm too busy laughing at the economy at full employment line to read the article.

There are currently some 94mm persons employed in the private sector, 21mm .gov workers of all stripes, and 102mm working-age 'Mercans without jobs. That's roughly 40% unemployment - not to mention that less than 94mm people (the fraction that doesn't work for an organization with some form of .gov contract, grant, or incentives) are working to support some 226mm+ people.

Fuck global warming - this is your unsustainability right here.

boopetyboopclick's picture

I also do think it is click-bait for kid haters.  

I'd propose a more credible conclusion is that the 1981 recession was different from the 2008 recession because:

  1. 1980s had better demographic trends to support wage recovery, i.e. boomers coming of age, buying houses, etc.
  2. The 1980s were an era of pre -globailization, -financialization and -gini coefficient distortion  (to an extent, of course)
  3. 1980s didn't have the same DM wage pressure on compeition for high-skill jobs from EM labor, as you mention on the H1b issue

It's intresting to see how research on this site gets politized these days.  An insightful analysis until the conclusion / headline were added:

Translation, when recession struck in 1981, Baby Boomers and Generation X got off their asses and took any job at any wage they could find to make ends meet.  But, when recession struck in 2008, millennials simply moved in with mom as opposed to taking a job that didn't fully reward their extensive skillset garnered from 4 years of rigorous anthropology studies at a preppy New England liberal arts college.


(Full disclosure, I come from the 2008 recession cohort)

random999's picture

what is the point of working?? seriously?

I have hardly worked for someone else in my entire life (mid 80s). I made more money the past 5 years owning an apartment than i would have from working. I have worked some but I hardly got anything for it.

If i wanted to work half of my salary would be going to a gov i dont support as taxes. tons of it to rapefugees who get 80% of their salary paid with my tax money if they want to compete with me and help dumping my salary. Then again i dont have a bachelor degree or lots of experience in engineering which seems to be a basic requirement for all interesting jobs. I cant study it because i didnt get top highschool grades. but i still get to pay for others who do qualify.

next step, buying something? a house? att current prices id have to be a slave rest of my life to pay it off.


nah this country isnt for me. I can buy a house in cash somewhere else and i got resources left for both education and starting a buisness.


fuck off europe, enjoy your new population. 

VZ58's picture

Give me a break. No previous generation has had so much going for it, yet most are wasting their lives. I get it, it's tough facing the reality that your generation is filled with cry babies and losers all around you, that are propped up by mom and dad. However if you accept the truth, you will win, since anyone with half a brain from this current generation could really go places if they show initiative. And therein lies the problem. 

Guess, what? I'm from the 1981 cohort and I'm the guy who decides if you get hired or not.

Jubal Early's picture

Well you have to admit that there could be some truth in that statement, that Millenials are perhaps a little less motivated, a little more distracted, and perhaps a little less fit for employment?

I graduated with a BS in Math and Business in '81 and there were practically no jobs to be had.  Unemployment was over 10% and interest rates were at 17%!  I finally found meaningfull employment in '83.  

Computer games were just getting started and there was NO INTERNET PORNOGRAPHY.  Millenials minds have been warped, its part of a very large plan.

XBroker1's picture

"Edit: Hasn't been a major terrorist attack in weeks? What gives?"

Now that you mention it.. that's probably not a good sign.They're likely going to fake a real big one. We have to send these snowflakes to war after all.

DontWorry's picture

ISIS is off balance from Trump Tweets

Haitian Snackout's picture

Maybe they are taking my advise and offering 15 bucks an hour in the hope of finding some better script writers.

Blurb's picture

Muh PhD in tranny studies.


Maybe if they could repair trannies....

Xena fobe's picture

Only Mexicans need apply for any blue collar job.

D Nyle's picture

As long as Libtards are suffering, this is Great. They just need to drag there Libtard parents down with them

Lumberjack's picture

Let's compare Goldmanites kids against the kids in this chart.

sheikurbootie's picture

The parents are mostly boomers and they're going broke from the mooching millennial kids.   I have several friends with mooching millennials kids with degrees or multiple degrees.   They'll never grow up until you cut the cord.  I know it's tougher for the parents, but you have to do it.

Wrenching Away's picture

So conservatives don't have millennial children living in their basement?

Shadow1275's picture

All aboard the Millennial hate wagon I guess..... again


Pay no attention to the FED, Leftist Politicians, Feminism, etc.


Hell I wish I was the one in the driver's seat. The Baby Boomers are currently driving us right over the Cliff

Moving and Grooving's picture

Agree with your first statement.


The Boomers will be seen as benign in their impact on society compared to later 'cohorts', IMO. Blaming them is the same as blaming Millennials - pointless and inappropriate.

Crypto Kevin's picture

It's their bullshit, hippy, socialist ideas that fucked this country up back in the 60's. Then it was the boomer yuppies that led to the debt fueled materialism of the 80's. The boomers will go down as the worst generation in the history of the US. They were handed the wealthiest most economical advantaged country the world has ever known and drove it into the ground on their watch.

NormanConquest01's picture

Read Hunter S. Thompson's "Generation of Swine".  That book sums it up for the Boomers.  

VZ58's picture

Get serious! Boomers are the cause. Millenials are the effect. We all better accept this before everything is lost.

Victor von Doom's picture

Disagree. Not pointless or inapporpriate. This late in the game, anyone who takes money from the government for anything is to blame.

The whole damn country is the the Free Shit Army.

silverer's picture

Marxist educators have succeeded beyond their wildest dreams when you look at millennials. Admire them, complement them, adore them and celebrate them. For they are the perfected Marxist future the government and teachers designed them to be. Parents, you didn't fail at all. You served your government well (instead of the government serving you), by opting out of being connected parents while chasing your own desires and goals, putting your kids last. Not all parents did that, of course, but way too many went down that road. Congratulations.

Okienomics's picture

But good news is on the horizon.  The generation following millenials don't have time for that bullshit...


lasvegaspersona's picture

Boomers will be the most screwed generation in history. The loss of pensions will be shocking. They will move in with their kids who might get a McDonalds job.

It has always been the reitrees who get hit the hardest.

All the BS about Boomer wealth depends upon a strong economy...which we do not have. Their 401ks will go to zip and Social Security will lose purchasing power...all unless the Fed really can do magic.

Xena fobe's picture

The youngest boomers are screwed, now 53 to 60 years old.

Xena fobe's picture

Boomers born after 1960 are not even eligible to collect SS until 67.



Okienomics's picture

Stop making up facts. Or if you don't fucking know, take 20 seconds and look it up before you show your ass.


armageddon addahere's picture

The average boomer is 63 years old. Most are already retired. The boomers aren't running things and haven't for some time. When do you plan on taking responsibility for yourself?

gouyou's picture

A big thing that happened in 1981 was the start of a new industrial revolution: computers!

I haven't seen any productivity transforming technology take a hold in the aftermath of 2008. Maybe AI, maybe something else will come up, but it's not there yet.

null's picture

Maybe the millennials are backseat driving the car over the cliff?
The "cliff" got 10 times closer over past 8 years, than it had since 1776 ... objectively speaking.

oldguyonBMXbike's picture

Higher education = government / banking / brainwash school racketeering scam.


Wait til I bring RICO charges...

oldguyonBMXbike's picture

They're not spoiled.  They're utterly lazy and incompetent and have no grasp of reality or any confidence in themselves or their abilities (which are typically NONE).  Hell, they said most kids these days can't even read an analog clock.  

Gen X was the LAST real generation.  


With the sperm count cut in half of the Western Male, we're looking at a real Children of Men situation.


Please don't blame the ignorant slaves. Blame the Jews.

Again, fuck the Jew that down-voted me!

Falling Down's picture


I've had the displeasure of having worked around millenials in a factory environment, in recent years. Small business, 2nd shift, and they outnumbered the Gen X (me and one other guy) group and the two great Boomers I worked with, 2:1.



Even in such a small group, they were pulling "Children of the Corn" bullshit about every sh

ift. They'd constantly fuck around on their phones, we even had one who was a wanna be cop trying to get into local LE, who would watch movies all night on his phone with his ear buds in.

This country will get its clocked cleaned, economically, when these clowns actually start getting serious about work, 'cause they'll be forced to

willy up the creek's picture

What the hell do you have to bring your sick, anti-Semitism into this for?  Save it for when you have your therapy with your shrink.  Well, I just down voted you too.

Spike the Railroader's picture

So many people have no idea what or who the crypto jews /sabotean jews are and have been.  They are Babylon /Talmudic black magicians originated from some time during anciant Atlantis when the Lucifer Project was in full swing. They are Satanic blood drinking vampires.


Moving and Grooving's picture

They don't whine and bitch about employment any more than any other 'cohort', in my observation. This has been a slog, with little wage growth forever, it seems. But there are jobs unfilled all over the place.

barysenter's picture

Fuck GS. They looted the country. Everything they say will be used against them. It only takes One to make a Firing Squad, thieves.

ThrowAwayYourTV's picture

The 20 something year olds are like 15 year olds these days. Not because of themselves but because of their stupid moms and dads.