You might call 2016 the Year of the Millennial. In 2015, the U.S. Census Bureau announced that millennials now outnumber baby boomers nationwide. According to Carolina Demography, millennial adults will outnumber baby boomers in North Carolina as soon as 2017.
Search online for “millennial generation” and you’ll find thousands of articles dedicated to analyzing every aspect of America’s young adult population. As the generation grows, political pundits are trying to predict how’ll they affect politics this year.
Next try searching for the phrase “millennials love Bernie Sanders,” and you will find pages and pages of articles with the same conclusion. The Washington Post’s John Wagner put it best: “(Millennials) grew up in the recession, watched their parents struggle and became anxious about their futures. They are graduating from college with huge debts and gnawing uncertainty about landing jobs and affording homes. They have little faith in government and other institutions they thought they could depend on.”
Wagner describes problems that are ultimately financial in nature, and Sanders’ signature issue is his crusade against Wall Street. But the trend isn’t limited to left-leaning young adults. Donald Trump, the other candidate railing against the entrenched establishment, is winning the millennial vote among Republicans.
According to the Pew Research Center, 46 percent of millennials identify as lower or lower-middle class, up from 25 percent in 2008. Feeling financially vulnerable and failed by the status quo, this generation is in search of alternatives.
North Carolina politicians should take heed. Millennials will only grow in electoral power, and the winds of change sweeping the nation today will come to North Carolina tomorrow. It’s time for us to show the millennial generation that we do have the power – and the political will – to address their financial anxieties. We should begin by tackling two sources of those anxieties: student debt and retirement.
As the cost of higher education explodes, the amount of student debt rises even faster. Student debt is now the second-largest form of household debt in the United States, behind only mortgage debt. American families have more student debt than credit card debt. It’s an issue that other generations have not had to contend with on the same scale, and perhaps this is why it has taken so long to address it.
North Carolina can take a step in the right direction by implementing a student loan refinancing authority. Student loan refinancing was pioneered by Rhode Island and Connecticut and uses the state’s bonding authority to refinance student loans at a significantly lower interest rate. Loan repayments pay off the bonds and pay for the costs of running the program.
North Carolina can also help millennials save for retirement. With stagnant incomes and mounting student debt, millennials have less money to store away in retirement savings. An August 2015 survey from the Insured Retirement Institute and The Center for Generational Kinetics found that only 29 percent of millennials describe themselves as actively preparing for retirement.
It’s not just a lack of money keeping millennials from saving – it’s also a lack of retirement options. Corporate pensions are going extinct, and many jobs in today’s economy don’t even offer a 401(k). A 2014 National Institute for Retirement Research study found that just 42 percent of private-sector workers in North Carolina participated in any kind of employer-sponsored retirement savings plan.
Once again, states are taking the lead on a solution. State-sponsored 401(k) programs, like the Work & Save model championed by the AARP, have begun in California, Oregon, Massachusetts and Illinois.
North Carolina now has a chance to show millennials that government can address their problems instead of ignoring them. If we do that, North Carolina will be positioned as a millennial-friendly place to start a family, a career or a new business.
If we continue to ignore millennial anxieties, the inevitable alternative is for a new generation of voters to sweep away the current generation of politicians.
Justin Guillory is executive director of Think NC First, a state policy think-tank based in Raleigh.