Has Intergenerational Progress Stalled? Income Growth Over Five Generations of Americans

58 Pages Posted: 29 Feb 2024

See all articles by Kevin Corinth

Kevin Corinth

University of Chicago

Jeff Larrimore

Board of Governors of the Federal Reserve System

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Date Written: February, 2024

Abstract

We find that each of the past four generations of Americans was better off than the previous one, using a post-tax, post-transfer income measure constructed annually from 1963-2022 based on the Current Population Survey Annual Social and Economic Supplement. At age 36–40, Millennials had a real median household income that was 18 percent higher than that of the previous generation at the same age. This rate of intergenerational progress was slower than that experienced by the Silent Generation (34 percent) and Baby Boomers (27 percent), but similar to that experienced by Generation X (16 percent). Slower progress for Generation X and Millennials is due to their stalled growth in work hours—holding work hours constant, they experienced a greater intergenerational increase in real market income than Baby Boomers. Intergenerational progress for Millennials under age 30 has remained robust as well, although their income growth largely results from higher reliance on their parents. We also find that the higher educational costs incurred by younger generations is far outweighed by their lifetime income gains.

Keywords: Full income, Growth, Generations, Mobility, Millennials

JEL Classification: D31, E24, H24, J30, J62

Suggested Citation

Corinth, Kevin and Larrimore, Jeff, Has Intergenerational Progress Stalled? Income Growth Over Five Generations of Americans (February, 2024). FEDS Working Paper No. 2024-7, Available at SSRN: https://ssrn.com/abstract=4741448 or http://dx.doi.org/10.17016/FEDS.2024.007

Kevin Corinth (Contact Author)

University of Chicago ( email )

1155 East 60th Street
Chicago, IL 60637
United States

Jeff Larrimore

Board of Governors of the Federal Reserve System ( email )

20th Street and Constitution Avenue NW
Washington, DC 20551
United States

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