Are Recent Grads Worse Off Today?

I was recently with a college friend (“Alex”) who pronounced that this generation of young college graduates has a problem: they are not willing to sacrifice in order to plow ahead amid a challenging economic environment. “When I graduated in 1986, I had roommates, moved far outside of the city, which required a long commute, and just stopped spending!” You may be thinking, “OK, Boomer, you are just an old guy complaining about the younger generation.” Maybe, but Alex is familiar with the demo because he has two children who are in their twenties, both of whom have jobs, which made his comments curious to me.

Is this just a random example of an oldster calling into question the current generation’s lack of grit? Instead of arguing at a BBQ, I decided to dive into the data and present Alex with the facts on the ground. Back in August 1986, the national unemployment rate was a lot higher than it is today: 6.9 percent vs. last month’s reading of 4.1 percent. The Bureau of Labor Statistics didn’t slice and dice the data by age and by degree type before the year 2000, but what we know is that forty years ago, the unemployment rate for 20- to 24-year-olds was 10.7 percent, and today, that rate stands at 7.1 percent. That said, this year, “college-educated workers ages 22 to 34 years old have only seen worse unemployment in the past two decades during the pandemic and the economy’s slow rebound from the 2007-09 recession,” according to the Wall Street Journal.

Alex remembered that his first salary after college was just “twenty or twenty-five grand,” which sounded like peanuts, until you realize that median household income in 1986 was $24,900, so pretty good for a first job. The number is even more impressive when adjusted for inflation, which puts the equivalent at just under $76,000 in today’s dollars. For reference, the most recent Census figure for median household income is $83,730 for 2024 (2025/2026 data has not been published yet), so incomes have outpaced inflation by about 10 percent.

So, if the job market has been pretty good and wages are mostly keeping up, where is the pain point? The answer lies in the cost of housing. As I have noted in a past column, a Savings.com survey found that among parents providing support for their adult children, 63 percent chipped in with housing costs, in the form of mortgage, rent assistance, or having the adult kid live at home. A 2025 Pew Research report found that 18 percent of adults ages 25 to 34 were living with their parents in 2023, more than double the share from 1970.

According to the Zillow rent index, the typical U.S. asking rent was $1,962 in July 2026. Zillow calculates that a household needs roughly $78,488 in annual income to comfortably afford that typical rent, if you were to abide by the (now outdated) rule that housing costs shouldn't eat up more than 30 percent of gross income. Meanwhile, based Census figures for 1980 and 1990, the national median monthly rent was about $365 in the mid-1980s, which works out to roughly $1,112 in 2026 dollars, a whopping 43 percent LESS than today's $1,962 typical asking rent.

Put the two together and you get a more nuanced story that belies the “these kids don’t have grit” narrative. A 1986 grad faced a more difficult employment landscape, but those who were able to land jobs could more readily afford moving out on their own. Each generation faces challenges, so let’s ditch the judgments and stop sounding like the cranky folks about whom we once complained.