Grad students should save for retirement

[marshwiggle]

I heard a rant from a millenial or Gen Z a couple of weeks ago about how much harder they have it than boomers did. I thought back to my own situation.

Very senior [boomer] employee in the company I was starting in after finishing my PhD once started reminiscing about how broke he was just after grad school sometime in the early 1980s, when he was starting (in the same company actually). Apparently his boss had to give him several thousand dollars advance, to help him rent place etc.
- any employee asking for an advance for an entry-level position now will be laughed out of an interview. Actually, the amount he mentioned would represent quite noticeable portion of my starting salary (after accounting for inflation).
- one can't work in the same company for 30+ years anymore. Current HR thinking considers people not switching jobs every several years "lacking initiative" or even "lazy". They openly said to me that I need to have a competing offer to ask for anything.

This is kind of the reverse perspective of what I've gotten from my Gen Z offspring. In tech, people are frequently changing jobs because they're always looking for greener pastures. They get high salaries to begin with, and there are always new startups that they can go to which may be the next Google.

TLDR; for many, job turnover is because they expect to rise through the ranks at a pace their parents would never have dreamed of.

To me it seems that this is more of a cultural shift caused by how companies treat employees.  If you stop offering pensions, benefits, and permanent positions (the so called gig economy), why would you expect employee loyalty?

But some of these tech companies are the ones that provide food, games, etc. for their employees. They provide more perks than ordinary companies, and certainly way more than any company provided in their parents' generation.

[Puget]

I heard a rant from a millenial or Gen Z a couple of weeks ago about how much harder they have it than boomers did. I thought back to my own situation.

Very senior [boomer] employee in the company I was starting in after finishing my PhD once started reminiscing about how broke he was just after grad school sometime in the early 1980s, when he was starting (in the same company actually). Apparently his boss had to give him several thousand dollars advance, to help him rent place etc.
- any employee asking for an advance for an entry-level position now will be laughed out of an interview. Actually, the amount he mentioned would represent quite noticeable portion of my starting salary (after accounting for inflation).
- one can't work in the same company for 30+ years anymore. Current HR thinking considers people not switching jobs every several years "lacking initiative" or even "lazy". They openly said to me that I need to have a competing offer to ask for anything.

This is kind of the reverse perspective of what I've gotten from my Gen Z offspring. In tech, people are frequently changing jobs because they're always looking for greener pastures. They get high salaries to begin with, and there are always new startups that they can go to which may be the next Google.

TLDR; for many, job turnover is because they expect to rise through the ranks at a pace their parents would never have dreamed of.

To me it seems that this is more of a cultural shift caused by how companies treat employees.  If you stop offering pensions, benefits, and permanent positions (the so called gig economy), why would you expect employee loyalty?

But some of these tech companies are the ones that provide food, games, etc. for their employees. They provide more perks than ordinary companies, and certainly way more than any company provided in their parents' generation.

From friends in tech, I gather than both employers and employees see advantages of frequent job changes. The employers because it allows them to gain from the skills and ideas employees gained at their competitors, and the employees because it is the best way to get a higher salary and move up. No one involved sees any advantage to "loyalty" to an employer.

[Durchlässigkeitsbeiwert]

This is kind of the reverse perspective of what I've gotten from my Gen Z offspring. In tech, people are frequently changing jobs because they're always looking for greener pastures. They get high salaries to begin with, and there are always new startups that they can go to which may be the next Google.

TLDR; for many, job turnover is because they expect to rise through the ranks at a pace their parents would never have dreamed of.

It is part of the same feedback loop.
People looking to accelerate career change jobs often => Changing jobs becomes associated with career advancement => People not changing jobs do not get promoted (or even do not get raises) => It becomes very detrimental to stay at the same place for long

Rise of tech may actually play role here on a cultural level: since IT is the hottest industry, it becomes the source HR and management ideas that promptly get applied to other sectors without considering differences in expected career paths and available resources. E.g. companies eliminate job security without "high salaries to begin with" or possible upside of startup, and then complain that they cannot find people.

[marshwiggle]

I heard a rant from a millenial or Gen Z a couple of weeks ago about how much harder they have it than boomers did. I thought back to my own situation.

Very senior [boomer] employee in the company I was starting in after finishing my PhD once started reminiscing about how broke he was just after grad school sometime in the early 1980s, when he was starting (in the same company actually). Apparently his boss had to give him several thousand dollars advance, to help him rent place etc.
- any employee asking for an advance for an entry-level position now will be laughed out of an interview. Actually, the amount he mentioned would represent quite noticeable portion of my starting salary (after accounting for inflation).
- one can't work in the same company for 30+ years anymore. Current HR thinking considers people not switching jobs every several years "lacking initiative" or even "lazy". They openly said to me that I need to have a competing offer to ask for anything.

This is kind of the reverse perspective of what I've gotten from my Gen Z offspring. In tech, people are frequently changing jobs because they're always looking for greener pastures. They get high salaries to begin with, and there are always new startups that they can go to which may be the next Google.

TLDR; for many, job turnover is because they expect to rise through the ranks at a pace their parents would never have dreamed of.

To me it seems that this is more of a cultural shift caused by how companies treat employees.  If you stop offering pensions, benefits, and permanent positions (the so called gig economy), why would you expect employee loyalty?

But some of these tech companies are the ones that provide food, games, etc. for their employees. They provide more perks than ordinary companies, and certainly way more than any company provided in their parents' generation.

From friends in tech, I gather than both employers and employees see advantages of frequent job changes. The employers because it allows them to gain from the skills and ideas employees gained at their competitors, and the employees because it is the best way to get a higher salary and move up. No one involved sees any advantage to "loyalty" to an employer.

This raises the interesting question of whether the concept of "loyalty" is perhaps outdated, at least in certain sectors of the economy, as a metric of quality of employers and/or employees.

[Kron3007]

I heard a rant from a millenial or Gen Z a couple of weeks ago about how much harder they have it than boomers did. I thought back to my own situation.

Very senior [boomer] employee in the company I was starting in after finishing my PhD once started reminiscing about how broke he was just after grad school sometime in the early 1980s, when he was starting (in the same company actually). Apparently his boss had to give him several thousand dollars advance, to help him rent place etc.
- any employee asking for an advance for an entry-level position now will be laughed out of an interview. Actually, the amount he mentioned would represent quite noticeable portion of my starting salary (after accounting for inflation).
- one can't work in the same company for 30+ years anymore. Current HR thinking considers people not switching jobs every several years "lacking initiative" or even "lazy". They openly said to me that I need to have a competing offer to ask for anything.

This is kind of the reverse perspective of what I've gotten from my Gen Z offspring. In tech, people are frequently changing jobs because they're always looking for greener pastures. They get high salaries to begin with, and there are always new startups that they can go to which may be the next Google.

TLDR; for many, job turnover is because they expect to rise through the ranks at a pace their parents would never have dreamed of.

To me it seems that this is more of a cultural shift caused by how companies treat employees.  If you stop offering pensions, benefits, and permanent positions (the so called gig economy), why would you expect employee loyalty?

But some of these tech companies are the ones that provide food, games, etc. for their employees. They provide more perks than ordinary companies, and certainly way more than any company provided in their parents' generation.

Food and games are nice but not really long term incentives.  Perhaps they also do that, but maybe not. 

Regardless, outside the tech industry that is not the case and cultural shifts go beyond any one sector.  It used to be that employee loyalty was valued/expected, and now it isn't (or not perceived to be).  This generation's attitude toward work culture is not the same, for better or worse. 

[marshwiggle]

I heard a rant from a millenial or Gen Z a couple of weeks ago about how much harder they have it than boomers did. I thought back to my own situation.

Very senior [boomer] employee in the company I was starting in after finishing my PhD once started reminiscing about how broke he was just after grad school sometime in the early 1980s, when he was starting (in the same company actually). Apparently his boss had to give him several thousand dollars advance, to help him rent place etc.
- any employee asking for an advance for an entry-level position now will be laughed out of an interview. Actually, the amount he mentioned would represent quite noticeable portion of my starting salary (after accounting for inflation).
- one can't work in the same company for 30+ years anymore. Current HR thinking considers people not switching jobs every several years "lacking initiative" or even "lazy". They openly said to me that I need to have a competing offer to ask for anything.

This is kind of the reverse perspective of what I've gotten from my Gen Z offspring. In tech, people are frequently changing jobs because they're always looking for greener pastures. They get high salaries to begin with, and there are always new startups that they can go to which may be the next Google.

TLDR; for many, job turnover is because they expect to rise through the ranks at a pace their parents would never have dreamed of.

To me it seems that this is more of a cultural shift caused by how companies treat employees.  If you stop offering pensions, benefits, and permanent positions (the so called gig economy), why would you expect employee loyalty?

But some of these tech companies are the ones that provide food, games, etc. for their employees. They provide more perks than ordinary companies, and certainly way more than any company provided in their parents' generation.

Food and games are nice but not really long term incentives.  Perhaps they also do that, but maybe not. 

Regardless, outside the tech industry that is not the case and cultural shifts go beyond any one sector.  It used to be that employee loyalty was valued/expected, and now it isn't (or not perceived to be).  This generation's attitude toward work culture is not the same, for better or worse.

One big factor is that they've been told (indoctrinated, whatever) to find/follow their "passion", with the implication that a job that  they don't feel *passionate about is somehow "wrong" for them. It's hard to see how many perfectly normal and useful jobs will fill that, let alone entry-level jobs in just about any sector.


*And they expect to feel that within a few weeks, or months at the most. Their parents, even if they eventually came to feel their jobs were worthwhile, may not have concluded that until a few years into them.

[Kron3007]

I heard a rant from a millenial or Gen Z a couple of weeks ago about how much harder they have it than boomers did. I thought back to my own situation.

Very senior [boomer] employee in the company I was starting in after finishing my PhD once started reminiscing about how broke he was just after grad school sometime in the early 1980s, when he was starting (in the same company actually). Apparently his boss had to give him several thousand dollars advance, to help him rent place etc.
- any employee asking for an advance for an entry-level position now will be laughed out of an interview. Actually, the amount he mentioned would represent quite noticeable portion of my starting salary (after accounting for inflation).
- one can't work in the same company for 30+ years anymore. Current HR thinking considers people not switching jobs every several years "lacking initiative" or even "lazy". They openly said to me that I need to have a competing offer to ask for anything.

This is kind of the reverse perspective of what I've gotten from my Gen Z offspring. In tech, people are frequently changing jobs because they're always looking for greener pastures. They get high salaries to begin with, and there are always new startups that they can go to which may be the next Google.

TLDR; for many, job turnover is because they expect to rise through the ranks at a pace their parents would never have dreamed of.

To me it seems that this is more of a cultural shift caused by how companies treat employees.  If you stop offering pensions, benefits, and permanent positions (the so called gig economy), why would you expect employee loyalty?

But some of these tech companies are the ones that provide food, games, etc. for their employees. They provide more perks than ordinary companies, and certainly way more than any company provided in their parents' generation.

Food and games are nice but not really long term incentives.  Perhaps they also do that, but maybe not. 

Regardless, outside the tech industry that is not the case and cultural shifts go beyond any one sector.  It used to be that employee loyalty was valued/expected, and now it isn't (or not perceived to be).  This generation's attitude toward work culture is not the same, for better or worse.

One big factor is that they've been told (indoctrinated, whatever) to find/follow their "passion", with the implication that a job that  they don't feel *passionate about is somehow "wrong" for them. It's hard to see how many perfectly normal and useful jobs will fill that, let alone entry-level jobs in just about any sector.


*And they expect to feel that within a few weeks, or months at the most. Their parents, even if they eventually came to feel their jobs were worthwhile, may not have concluded that until a few years into them.

Yes, but the irony here is that if they believe that (I dont know if I agree) it is because their parents' generation indoctrinated them to believe so and then blame them for it.

[Stockmann]

Both sides are right, kind of, at least in the US. Objectively, a college education when the boomers were young adults cost peanuts compared to what it costs today, and the same could be said of housing and health care, add in that there aren't that many jobs anymore that pay well, offer stability and health insurance but don't require a college degree or very highly specialized skills, and objectively speaking young Americans have it a lot harder, economically, than the boomers did - this is especially true of those growing up in bad school districts, because they have much fewer good non-college alternatives than the boomers did, and the cost of trying college and dropping out is higher than ever before.
On the other hand, there's the proverbial climbing walls, lazy rivers, buffet meal plans, pool tables, top-of-the-range sporting facilities, etc. When I was a grad student, I cooked, lived with roomies in a shared basement apartment for a while, etc, so I'm not very sympathetic to "needing" the deluxe "college experience" or complaints that the sushi isn't authentic enough for their liking (there were some SJWs complaining about this a while back) - the last Shah of Iran liked his French food authentic, so he had it flown in by jet from a swanky place in Paris, but that's hardly a model of spending wisely.

[dismalist]

I heard a rant from a millenial or Gen Z a couple of weeks ago about how much harder they have it than boomers did. I thought back to my own situation.

Very senior [boomer] employee in the company I was starting in after finishing my PhD once started reminiscing about how broke he was just after grad school sometime in the early 1980s, when he was starting (in the same company actually). Apparently his boss had to give him several thousand dollars advance, to help him rent place etc.
- any employee asking for an advance for an entry-level position now will be laughed out of an interview. Actually, the amount he mentioned would represent quite noticeable portion of my starting salary (after accounting for inflation).
- one can't work in the same company for 30+ years anymore. Current HR thinking considers people not switching jobs every several years "lacking initiative" or even "lazy". They openly said to me that I need to have a competing offer to ask for anything.

This is kind of the reverse perspective of what I've gotten from my Gen Z offspring. In tech, people are frequently changing jobs because they're always looking for greener pastures. They get high salaries to begin with, and there are always new startups that they can go to which may be the next Google.

TLDR; for many, job turnover is because they expect to rise through the ranks at a pace their parents would never have dreamed of.

To me it seems that this is more of a cultural shift caused by how companies treat employees.  If you stop offering pensions, benefits, and permanent positions (the so called gig economy), why would you expect employee loyalty?

But some of these tech companies are the ones that provide food, games, etc. for their employees. They provide more perks than ordinary companies, and certainly way more than any company provided in their parents' generation.

Food and games are nice but not really long term incentives.  Perhaps they also do that, but maybe not. 

Regardless, outside the tech industry that is not the case and cultural shifts go beyond any one sector.  It used to be that employee loyalty was valued/expected, and now it isn't (or not perceived to be).  This generation's attitude toward work culture is not the same, for better or worse.

In 2020, two thirds of private sector workers have access to employer retirement benefits.

https://www.bls.gov/opub/ted/2021/67-percent-of-private-industry-workers-had-access-to-retirement-plans-in-2020.htm

That is not very different from recent years, higher if anything.

[Durchlässigkeitsbeiwert]

This raises the interesting question of whether the concept of "loyalty" is perhaps outdated, at least in certain sectors of the economy, as a metric of quality of employers and/or employees.

I would call it "mutual loyalty for a long-term self-interest".
I am in a quite narrow STEM sub-field. So,
- it is hard for me to quickly find a job without moving, if I am laid off
- it is hard for employer to quickly replace me
It looks beneficial for both sides if I keep loyal to the company (i.e. not leaving it for short-term gain) in exchange for job security (i.e. not getting rid of me in downturns for a short-term cost savings) and a clear career path.
Instead, last year I was essentially forced to change jobs (with a long-distance move) by my then employer's "only token raises without outside offer" HR policy

[clean]

The incentives also might not actually be very clear for many poorer folks. If your income is below the poverty line, that often means that any one thing going wrong can derail everything. If your car breaks down, you might not be able to afford a new one and then you could lose your job if public transportation isn't available or feasible. Making good financial choices won't necessarily make much difference because you many not be able to save enough to cushion yourself from these kinds of shocks.

In some cases, things that could be viewed as poor spending choices actually might be forms of social investment in networks. If something bad does happen to poorer people, having family and friends who will help you out in various ways is often how you can avoid really catastrophic outcomes. Money spent that might solidify those relationships (vacations, dinners, presents) might actually make a lot of sense.

This is an area we are looking into extending our research.

It is about insurance.  You invest in networks so that people will be available to help you.  YOU in turn are THEIR support network!

So imagine the poor area in your town and what it looks like at Walmart close to the start of the month (when the government safety net payments are out.). What do you see?  People load the carts with things that they really dont need and have a big party?  Why?
Well, IF you have $50, and your friend/family has a problem, then YOU are duty/honor/network bound to support them.  IF you, on the other hand make what may appear to be a poor financial choice (buy jewelry, junk food, whatever), then the money is gone, and you are 'off the hook' for the social network! 

IF you buy junk food and eat it up at the start of the month and your family friend are asking for food later in the month, well, you can no longer help.

So, these poor financial decisions may have other reasons, and the disposal of the financial asset ($) in exchange for things that are less likely to be needed by your network, may be wise.
As was stated earlier... why store your treasures on Earth, when ONE of your friends/relatives are Bound to NEED it, and you know you will NEVER get it back (at least in the form given--$$)?

[spork]

^ Karl Polanyi and James C. Scott rear their ugly heads.

[dismalist]

^ Karl Polanyi and James C. Scott rear their ugly heads.

Yes, we are on our own.  There is a yearning within us not to be, but we are.

The village is gone. Thank goodness. Speaking with Charlie Marx: Capitalism has saved us from the idiocy of village life.

[Vkw10]

Are younger people today really worse off financially than previous generations? Perhaps they are, but I was intrigued by this argument that they aren't. https://economistwritingeveryday.com/2021/09/01/who-is-the-wealthiest-generation/

[Durchlässigkeitsbeiwert]

Are younger people today really worse off financially than previous generations? Perhaps they are, but I was intrigued by this argument that they aren't. https://economistwritingeveryday.com/2021/09/01/who-is-the-wealthiest-generation/

It actually proves the point that millennials are worse off:
1) despite much higher average level of educational attainment they are getting the same deal in inflation-adjusted dollars.
[I feel paraphrasing Red Queen would have worked here well]

2) consumer price index (use to do the inflation adjustment) traditionally does not include housing - the main point of contention.
So, even if average millennial and boomer have the same amount of the inflation adjusted dollars when they are 30, the millennial would struggle to buy the house well within reach of the boomer

PS author used averages, so the values shown on plots are achieved only by a small fraction of the population