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Report: Next Generation VA Workers Not "Movin' On Up"

October 30, 2008

Washington, D.C. – Youthful Virginia workers are more educated today than a generation ago, but that isn't translating into better pay. According to an analysis of U.S. Census Bureau data, after adjusting for inflation, "Generation Y" is making less money at work than its counterparts did 30 years ago--10 percent less.

The report from the Center for Economic and Policy Research found one exception: young employees represented by a union. Unionized employees in their twenties are more likely to have health insurance, and they have a bit of an edge on the pay scale, making about $1.75 more per hour than non-union workers.

Report author and economist John Schmitt says the challenge is that most young employees don't have access to a union.

"By U.S. labor law, it's very difficult to organize a union. Unless we get some changes to U.S. labor law, I think these trends are likely to continue."

Schmitt says it seems to be generally acceptable in this country to pay young people less. However, it shouldn't be, he points out, because it hurts families.

"We're really talking about babies being born into the world to parents who are young. Those folks need economic resources, they need better wages, they need health insurance."

Unionized young workers are about 30 percent more likely to have health coverage, he adds.

Schmitt says it's surprising to see young-worker wages fall compared to 30 years ago, since the education level is so much higher today.

"Given this investment in education that young people have made--young people and their parents have made--it's particularly disheartening."

Critics of the report say unions hurt businesses. They explain that lower pay is due to less job experience, which is a consequence of workers changing jobs more often than they did 30 years ago.

Virginians interested in viewing the full report can find it at www.cepr.net.

Eric Mack/Don Mathisen, Public News Service - VA