California is Devouring Its Young
The Golden State has long been synonymous with youth and vitality. This is where bright-eyed Midwesterners come to pursue their dreams of Hollywood stardom; where brilliant young techies venture to launch startups in the hopes of becoming the next Steve Jobs or Mark Zuckerberg.
Increasingly, it’s also where dreams come to die.
A new report from the Center for Demographics and Policy at Chapman University concludes that the Golden State has become hostile territory for the millennial generation. More than 20% of the state’s 18 to 24-year-olds live in poverty. Well-paying jobs in the information, finance and manufacturing sectors are scant, forcing even the educated to work low-wage service and leisure jobs for longer periods of time. Lawmakers pursue higher wage mandates to offset these challenges, but the youth unemployment rate grows ever higher. In 2017, it increased from 18% to 20%.
The problem is compounded by a crippling housing crisis, spurred by anti-development sentiment and strict regulations. Homes in California are 230% above the national average. That makes it nearly impossible for a middle-aged couple to attain the dream of homeownership, let alone a 30-something just starting out. Unsurprisingly, we have some of the lowest percentages of homeownership for those aged 25 to 34 in the nation. Only New York and Hawaii are worse.
Rents are just as bad. As a result, more millennials are living at home with their parents than ever before. In Southern California, over 40% of people between the ages of 18 and 34 are still bunking with mom and dad.
What does it all mean? Exodus.
Outmigration is rising again in the Golden State, according to the U.S. Census Bureau. Even more worrisome, it is the young and middle and upper classes that appear to be leaving. The trend is most pronounced in the more expensive regions of the state. 74% of Bay Area millennials say they are considering moving out in the next five years. Meanwhile, as we reported in March, Realtor.com recently ranked Salt Lake City, Utah as the #1 city capturing millennial interest because of its affordability. In other words, millennials are less interested in San Francisco and L.A. than a place where state liquor stores close on Sundays and beer’s alcohol content is limited to 3.2%.
The inhospitableness doesn’t just threaten to change the culture of California as we know it; it’s putting the state’s long-term social and economic stability in jeopardy, the researchers conclude. Lawmakers and regulators must pursue new policies to make California a more attractive place for middle class workers and young people. If not, we risk becoming the land of broken dreams.