Today's young people seem to live worse than their parents. And his grandparents! It is a trend that, far from slowing down, is accelerating. In Catalonia, the latest available data corresponding to 2020 show that the disposable income of young people (people between 16 and 39 years old) falls to the lowest percentage of the series in relation to those over 64. The income of young people is equal to 77.8% of that of the elderly. That means they have nearly a quarter fewer resources to spend on a day-to-day basis. In 2012, this percentage was 84.8%, according to Idescat data compiled by the Department of Economy in the latest issue of the Joint Note for the month of July. The source of the data is the INE Living Conditions Survey.
Sources from the Department of Economy explain that although the causes of the increase in the gap are diverse, it can be pointed out that, since the global financial crisis, the labor market increasingly offers less stable relationships and more intermittent situations, which make the annual income of the affected groups is lower (especially of the groups most exposed to labor turnover, which are the youngest)”. Temporality and job insecurity are behind this situation.
Disposable income is what a person has left by adding all the income they have, whether from work or public transfers, and subtracting personal income tax, wealth taxes and Social Security contributions.
The fact that the income of young people is becoming a lower percentage than that of the elderly does not mean that it has not grown in the analyzed period, but rather that it has done so to a lesser extent. The average income of citizens aged 16 to 39 was 13,371 euros in 2020. It is 15.8% higher than in 2012. In that same period, the increase in the income of retirees grew by 26.3%, up to 17,196 euros.
From the Department of Economy they also point out that "our welfare state protects more the income of pensioners (much more stable) than the income of workers, which has a more intermittent character". That is another reason that could be behind the increase in the intergenerational gap.
The studies service of the Barcelona Chamber of Commerce has compiled the same data for all communities and for Spain. In this case, there is also a decrease in the income of young people compared to older people, but the percentage is not the minimum of the historical series. In the case of Spain, the data is different from that of Catalonia and the group between 16 and 29 years of age is taken as young people. The latest available data shows that in 2020, the income of young Spaniards was 75.6% of that of those over 64. It is a much lower percentage than in 2008 when it exceeded 94.7 % just before the financial crisis hit. The lowest level was in 2015 (73.25), coinciding with the hardest moment of the crisis.
The technicians of the Department of Economy of the Generalitat reflect that both in Spain and in Catalonia, the covid has had an effect on the widening of the gap between young and old. "But the greatest impact occurred as a result of the financial crisis of 2008-2013, as can be seen in the INE bases," explained Economy sources.
The calculations are made from generic statistical data on family income. The specific figure for each group (be it the young or the elderly) is made through an estimate, since the household income is divided by each of the people who live there. That is why what is important, more than the numerical figure, is the trend. And the trend marks a worsening of the quality of life of young people both in Catalonia and in Spain as a whole.
There are other macro statistics that go in the same direction, such as unemployment, which show a greater impact among the young and the elderly. A CaixaBank Research report highlights that since the real estate crisis of 2008 "poverty is becoming chronic, especially in the youngest households and with dependent minors". In this case, the main factor that explains this situation of poverty is unemployment. The general unemployment rate in Spain is 12.5%, but if we analyze that of those under 25 years of age, the figure jumps to 28.5%. It is more than double. With these figures it will be difficult to close the gap.
