Market Urbanism

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NYC 20-Somethings’ Stagnant Wages and Higher Cost of Living

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I need help with this one. Is this a phenomenon of statistical cherry-picking or a true trend that should worry us?

New York Observer – A Yoke for the White Collar
New York’s college grads now hustle for jobs paying 1970s wages. Meet their coping mechanism—massive debt!

A younger New Yorker could be forgiven for running up debt: Real wages for 20-something professionals in New York haven’t changed since the early 1970s. At the same time, the number of college grads competing for white-collar jobs has increased—as has the cost of everything from real estate to beer to MetroCards.


image from article: Nigel Holmes: Source: Gotham Gazette, June 19, 2007

In 1970, 19.5 percent of New Yorkers in their 20s had college degrees, according to the analysis. By 2005, that percentage had more than doubled. By 2006, roughly one in three New Yorkers 25 and older had at least a college degree, according to N.Y.U.’s Furman Center for Real Estate and Urban Policy.

For younger college grads, the job market has become ever more competitive and the monetary rewards stagnant.

And yet they come.

Something doesn’t seem right and I can’t put my finger on it. The statistics seem a little cherry-picked, but I have suspicion that some important demographic trend is being neglected. Sure, I can see where wages are stagnant, but as more college educated young people have moved to New York?

Have shifts in immigration trends caused this? Or perhaps loss of manufacturing jobs that paid relatively well for young native New Yorkers?

I think it’s safe to say that many more college students have flocked to New York in the past decade, and many college students are taking longer to graduate. Could part of it be that more 20-somethings in New York are spending more time in the classroom and not yet earning money?

Any thoughts?

Comments

  1. It would have been much more useful if they showed median wages for “20-somethings” with college degrees.

    Instead we are left with fairly meaningless statistic. Perhaps in the 1970s, the wage distribution was tighter around the mean — and perhaps now the 20-somethings are more divided between high-paid college grads and low-paid messengers. (As you can see, the median would be unaffected by such a shift.)

    Come to think of it, since the 1970s, a huge chunk of the traditional middle class has left Brooklyn, Queens and The Bronx. These days, the city is largely comprised of four demographic zones:

    A) “Manhattan”, including Brooklyn Heights, Park Slope, Williamsburg, etc.

    B) Immigrant neighborhoods, such as Jackson Heights, Sunset Park, Ozone Park, Flushing, etc.

    C) “Underclass” or “ghetto” or pick-your-euphemism neighborhoods, like East New York, Hunts Point, Far Rockaway, etc.

    Though there are still some old-style middle class areas, they are vanishing.

    So maybe there is something to my theory. Or, maybe not.

  2. It would have been much more useful if they showed median wages for “20-somethings” with college degrees.

    Instead we are left with fairly meaningless statistic. Perhaps in the 1970s, the wage distribution was tighter around the mean — and perhaps now the 20-somethings are more divided between high-paid college grads and low-paid messengers. (As you can see, the median would be unaffected by such a shift.)

    Come to think of it, since the 1970s, a huge chunk of the traditional middle class has left Brooklyn, Queens and The Bronx. These days, the city is largely comprised of four demographic zones:

    A) “Manhattan”, including Brooklyn Heights, Park Slope, Williamsburg, etc.

    B) Immigrant neighborhoods, such as Jackson Heights, Sunset Park, Ozone Park, Flushing, etc.

    C) “Underclass” or “ghetto” or pick-your-euphemism neighborhoods, like East New York, Hunts Point, Far Rockaway, etc.

    Though there are still some old-style middle class areas, they are vanishing.

    So maybe there is something to my theory. Or, maybe not.

  3. Those wages are adjusted for inflation, so it’s not _that_ surprising.

    In addition to those effects suggested above, there are a few factors that could affect this

    1) College degrees might not be correlated with higher wages for young workers. I think you are right that people are spending more time in the classroom. In addition, people are spending more time in their early adulthood in a kind of extended adolescence.

    2) College degree rates have gone up everywhere, so having a college degree confers less competitive advantage now than it used to.

  4. Those wages are adjusted for inflation, so it’s not _that_ surprising.

    In addition to those effects suggested above, there are a few factors that could affect this

    1) College degrees might not be correlated with higher wages for young workers. I think you are right that people are spending more time in the classroom. In addition, people are spending more time in their early adulthood in a kind of extended adolescence.

    2) College degree rates have gone up everywhere, so having a college degree confers less competitive advantage now than it used to.

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