Subscriber OnlyOpinion

Today’s children could be worse-off than their parents

Amid global turmoil, the standard patterns of social mobility are shifting. Career choices are being recalibrated as financial and other rewards rise and fall

Designers, artists and musicians, largely from richer families, have seen their incomes fall on average 40 per cent below that of their parents in the US. Photograph: iStock

When I was a teenager, a friend’s south Dublin mother, in a one-stop effort to rank this unfamiliar young lad, on hearing my name asked: “Is that McWilliams the legal family?” When I replied in the negative, you could sense her disappointment as my position plummeted on the class score board in her head. Class, rank and position were never far from the surface of the suitability assessment of some mothers back in the 1980s. For me it was hilarious – but for them it was real.

From its independence up to the 1970s, Ireland experienced very little social mobility as the economy floundered. Since the 1980s, that has changed and Ireland has in general experienced rapid social mobility. Those kids born around the time John Paul visited in 1979 were the first generation to experience this social uplift on a generalised basis. Research from the ESRI notes a significant increase in absolute social mobility, with many individuals, regardless of their social origins, moving towards higher social classes most probably due to the expanding number of professional and managerial positions in the economy.

‘Life changing’ income scheme for artists means more spend time on work and fewer suffer from depressionOpens in new window ]

This social surge could be felt in every corner of the country. In a sense, you could call this “bourgeois-isation” of much of the population the “Irish Dream”. The Americans had their American Dream in the 1950s and 1960s, where children were likely to end up better off than their parents. These are the Boomers, much maligned by the younger and poorer Millennials and Generation X, largely because incomes are stagnating across America.

For example, 90 per cent of American Boomers born around 1940 were earning more than their parents by the time they were 30. This figure fell to 50 per cent for those people born in 1980, who are about 40 years old today. Much of the anger, the culture wars and the chaos in American politics is a direct reaction to the fact that this social conveyor belt is grinding to a halt.

READ MORE

Ireland, a late developer in the economic development game, experienced a similar Irish Dream in the late 1990s and early 2000s. Despite the crash, this upward social mobility endured until very recently.

Chief executives are less likely to come from wealthy families, suggesting meritocracy is alive within corporate America

Has it peaked? Are we about to go into an age where children are worse off than their parents? On the basis that we follow American social and economic trends with a lag of a couple of decades, this could be the case, posing a huge challenge to our society.

Against this background, with mobility curtailed, factors such as parental income and the choices children make will have a more consequential impact on where people end up in society. When all boats are rising, individual decisions, while always important, are affected by the general uplift. Once that stops, we are in a new world that might not look all that different from the 1980s world of social snobbery.

Thinking about moving jobs? Here’s how to get the salary you deserveOpens in new window ]

Again, we are helped by American data because the US has been keeping better sociological data than most countries for longer. After a period of rapid social upward mobility, America tells us what is likely to happen here. The study of US children born around 1979, the year of our pope’s children, compared how they fared vis-a-vis their parents in later life. The study, published in NPR’s Planet Money based and on US census data, followed these children to see whether they ended up being richer, poorer or just about the same.

Moving up, moving down
Graphic: The Irish Times / National Public Radio

What it shows is that, unexpectedly, doctors, surgeons and dentists fared far better than their parents. These medics ended up among the richest Americans, but they didn’t come from rich parents; on average medics came from parents with just above average incomes. Also at the top are chief executives but who, like medics, are less likely to have come from wealthy families, suggesting the meritocracy is alive within corporate America.

However, substantiating the posh southside mother’s question to me in the 1980s, lawyers and judges ended up in the top 10 per cent in the US and they came from the top 10 per cent richest families. In the US, coming from the law is the best for remaining in the law and maintaining family status between generations.

Young adults who choose the arts – writers, film-makers, actors, dancers, musicians – unless they are truly exceptional will see their income fall far below their more conventional socially mobile parents

Of the dozens of occupations assessed, the group that fared worst, who saw their income fall the furthest from their wealthy Boomer parents, are designers, artists and musicians; largely coming from richer families. They have seen their incomes fall on average 40 per cent below that of their parents. Kids who go into the arts tend to be middle-class. Another study tracking US census data back to 1850, found that higher total family income significantly increases the odds of an individual taking up a creative occupation.

This leads to another interesting result referred to as the “Lost Einsteins”. Because kids of richer parents are more likely to be able to follow their passions, kids from the top 1 per cent of families in the income distribution are 10 times more likely to become inventors than those from below-median income families. The research argues that this disparity may well be driven by environment rather than natural ability. The inference is there may be many lost Einsteins out there who could be hyper-creative innovators but are doing jobs they have to rather than those they want to do.

Will Generation Z be better off than their parents?Opens in new window ]

Children from richer families have what could be called “kitchen table capital”– that is, they are exposed to far more possibilities, attitudes and options at their kitchen table. They know people who have done it before them, who they can ask for advice as well as having money. These kids have what we used to call “pull”, which is now called networks, enabling them to excel.

That said, young adults who choose the arts – writers, film-makers, actors, dancers, musicians – unless they are truly exceptional, will see their income fall far below their more conventional socially mobile parents.

Ireland could be on the cusp of a similar trajectory as the US. Growth slows, social mobility begins to stall and opportunities are harder to find. It’s a world where career choices matter more than at any time over the past 30 years and those who fall behind might lurch politically in search of a saviour who might come from the unlikeliest of places.