Meet America’s New Poverty Class – the Millennials

NEW YORK (MainStreet) -- Does America have a new poverty class that leans closer to Charles Dickens than it does to Charles Darwin?

OK, maybe “survival of the fittest” doesn’t have much to do with it, or at least it isn’t the most compelling reason that younger Americans have fallen into the poverty class. After all, the “bad luck” generation hit their early 20’s in the teeth of an economic gale, which for them, hasn’t really abated.

But the data doesn’t lie, and it does support the notion that younger U.S. adults are sinking into poverty. 

Right now, the U.S. unemployment rate for the age 20-24 demographic stands at 13.5%, according to the U.S. Bureau of Labor Statistics, compared to 8.1% for the general population. 

Besides the larger realization among Millennials – and many economists – that between automation and outsourcing, good job opportunities are scarce, younger adults are moving back into their parent’s house because they’re broke.  According to the U.S. Census Bureau, 5.9 million young adults between the ages of 25 and 34 lived with their parents by 2011, up from 4.7 million in 2008. The agency also says that 45% of those “double-upper’s” generate incomes that are below the poverty lines.

But the capper on the jug could be a new report from Fort Worth, Texas-based Think Finance, an online financial products provider.  The survey of 640 U.S. Millennials reveals that more of them are using purportedly downscale financial products like pre-paid credit cards and pay day loans – and are actually ‘satisfied” with the experience.

What’s particularly newsworthy is that the younger set may be establishing new norms for future generations of U.S. financial consumers. Think Finance says Millennials across most income spectrums have turned to what the firm calls “alternative financial services”, and that they use “emergency forms of cash” and consider those alternatives “an important financial tool”.