Happy July 4th, investors. With US markets closed today, we’re turning our attention to how the younger generation is navigating an increasingly expensive economy.

Our team is excited to share this deeply researched special report — which first published as a feature in Inc. Magazine — for your weekend long read. 

Data-backed pessimism

One consequence of reporting on financial markets through my twenties is that it’s put me in contact with many young people who want to talk about money.

Hundreds of conversations and social media messages have left me with the disconcerting, if not clichéd, impression that Gen Z — those born between 1997 and 2012 — is deeply pessimistic about their economic prospects.

I field emails every week from college students and twenty-somethings voicing frustrations about their unease with artificial intelligence automating new-grad work, a stagnating job market, the yawning gap between wages and cost-of-living, and other hurdles to earnings power.

Gen Z is the most educated, connected, and savvy generation humans have ever raised, and they are coming of age in the most prosperous time in history. Yet this group is more hopeless about the future than any other cohort.

This paradox, to me, stems from a combination of three factors:

• Structural economic obstacles

• Hyper-awareness of information and other people’s opinions

• The collapse of grand narratives

This story unpacks each of these variables in an attempt to better understand why the kids are not alright.

AI’s taking jobs and people can’t afford homes

Older generations often consider Gen Z entitled, soft, and quick to complain.

Hard data, however, suggest that young people are not imagining their economic headwinds — no matter how invisible they seem to older millennials and baby boomers.

Anecdotal evidence, surveys, and financial figures all point to labor and housing markets that are structurally tilted against young people.

Over the last six years, for example, the income to afford a median-priced home in the US has jumped 70% from about $67,000 in 2019 to $114,000 in 2025, according to Realtor.com.

That’s pushed some Gen Z to delay moving out from their parents’ place or abandon their plans for homeownership altogether.

Even renting doesn’t provide the reprieve it once did. Bank of America data shows Gen Z spending on rent and utilities outpaces all other generations.

The same report — which characterized Gen Z as “overeducated and underemployed” — also concluded that young people spend nearly twice as much as they save.

It’s a combination of being cost-burdened and income-restrained.

While wage growth for young people has ticked up over the last several years, most of those gains have been negated by inflation. Since 2019, cumulative inflation has climbed to 26%, meaning you need $126 today to buy $100 worth of goods pre-pandemic.

Chalking this up as a work ethic problem or entitlement is intellectually lazy.

These are structural challenges that Gen Z cannot circumvent through job-hopping or promotions, especially given the labor market itself offers minimal security as AI eliminates the need for early-career corporate jobs.

Just a few weeks ago my former employer, Business Insider, cut 21% of its staff partly due to productivity gains that have come with the company’s AI usage.

A recent report from Oxford Economics found the unemployment rate among recent college grads has risen nearly triple compared to the national benchmark since the middle of 2023.

To be sure, the trouble does not fall evenly across the country or industry.

A working-class 22-year-old in the Midwest, for example, operates in a different economy than an Ivy League graduate in San Francisco.

Just the same, Gen Z’ers who pursued manufacturing, trade jobs or medicine, among other specialized fields, are not hurting for opportunity in the same way.

Still, combine the above challenges with rising student loan burdens, fast-improving AI models and skepticism about the ROI of college degrees, and the wider generational bind becomes clear.

Gen Z has done everything “right” only to enter an economy that doesn’t value young people the way it did even a decade ago.

This has led to economic disillusionment, at scale.

The algorithmic generation

Gen Z is the first generation to grow up fully online and fully watched.

Because they grew up with screens in their hands, they are the most digitally-immersed cohort ever. It’s the first generation that’s gone through puberty with access to infinite alternative universes in their pocket.

That has made them the most isolated, lonely and depressed generation.

While the labor and housing markets shape their economic experience, so do the algorithms that fill their social media feeds with hustle-porn, contrasting views on work-life balance, and idealized careers.

The collective identity of Gen Z, as a result, is formed by performative alignment with viral trends and algorithmic reward systems.

The hyper-visibility that has come to define Gen Z creates a comparison machine that never shuts off.

This creates two opposing forces that inform Gen Z’s outlook:

• They are acutely aware of their own precarious economic prospects

• They are constantly exposed to everyone else’s apparent success

Jonathan Haidt has done important work in this space.

His book, The Anxious Generation, lays out how smartphones and social media have debilitated young people’s sense of self and their ability to form community.

In the five years between 2010 and 2015 when smartphones became pervasive, self-reported symptoms of anxiety and depression among US teenagers surged roughly 150%, according to Haidt.

In the decade to 2020, the number of hospital visits for self-harm rose 188% among teenage girls and 48% among boys.

Mental illness, in other words, became exponentially more prevalent as more of Gen Z gained access to personal screens with personalized algorithms.

COVID-19 then exacerbated these issues by forcing quarantines, putting classrooms on Zoom and eliminating opportunities for in-person connection at a critical moment in Gen Z’s development.

Then, they had to reintegrate into a less affordable economy with a shrinking pool of suitable jobs that AI is now increasingly likely to disrupt.

There are very real technological — and so, psychological — reasons Gen Z expresses doubt about their ability to move forward in the world.

It doesn’t help that they’re constantly reevaluating their self-worth against what they see on their phones.

That skepticism has seeped into their beliefs about the institutions and economics of long-standing value systems.

Collapse of grand narratives

As if it wasn’t enough for Gen Z to face economic pressure and technological displacement, the bunch also faces a broad collapse in narrative continuity.

Effort no longer matches reward, ambition doesn’t always drive outcomes, and timeless stories don’t offer the same glue they once did.

For our parents’ generations, life unfolded with implicit guidelines. College led to a job which opened the door to having a family and owning a house.

That script, however flawed, offered predictability.

Institutions like the church, university, workplace and government provided scaffolding for identity and so purpose.

Gen Z, though, has grown up with those pillars fraying.

The once-reliable story about how life is supposed to work doesn’t fit as well in the eyes of young people, according to a 2024 survey from PPRI:

• More than one-third identify as having no religion at all

• Less than one-third of Gen Z adults say they have “a lot” of trust in major institutions

• About one in five believe the American Dream is “very much alive”

Like the economic and technological challenges addressed above, here we have a structural narrative disruption.

With faith in religion, work and homeownership fading, Gen Z is left navigating a choose-your-own adventure economy with rising stakes.

It’s worth highlighting that this disorientation isn’t an American phenomenon. Across Europe, the UK, and China, Gen Z is reporting record levels of pessimism.

While the specifics vary by geography, the generational angst does seem global.

Some sociologists have pointed to the idea of “existential liminality” — a prolonged, unstable phase of adulthood where traditional milestones like working, getting married, and owning a home feel permanently out of reach.

Without clear markers of progress and a new world that doesn’t strictly adhere to the old grand narrative, it’s no wonder Gen Z reports feeling unmoored.

The lack of structure pushes many young people to scour online spaces for meaning, which often deepens the disconnect from conventional paths, economic opportunities and relationships.

In previous decades, the future was a destination for ambition and upward mobility. Today — with geopolitical turmoil and economic uncertainty — it feels more like something to survive than pursue.

This subtle shift helps explain the unease that defines so much of Gen Z’s worldview.

Reasons for optimism

For all the valid reasons Gen Z may feel adrift and burdened, there are reasons for optimism.

Young people remain uniquely positioned to leverage new technology and innovate in ways that were not possible for millennials or boomers.

The very tools that unmoor Gen Z also unlock unprecedented leverage.

Social media, for all its anxiety-inducing features, also minimizes the barrier to entry for building businesses and brands. Publishing, distribution and influence are no longer reserved for institutions.

A single video on TikTok can get more attention than CNBC’s prime time business show, just as this newsletter could gain more traction than a story in The Wall Street Journal.

Social media has brought society closer to something like a meritocracy of ideas, where you don’t need massive financial resources to rise to the top.

The remote work that internet businesses unlock is also a new form of freedom. Pair those opportunities with the productivity gains afforded from AI and the ceiling for ambitious individuals is higher than ever.

That makes me optimistic that whatever comes next doesn’t have to be a dystopia where AI takes every job and humans can’t afford anything.

A story of reinvention

The story of Gen Z does not have to be one of economic failure.

It’s true they are navigating a bleak job market that seems to prefer people from a different age bracket. It’s also true that homeownership seems far out of reach.

But this generation also leads the country in digital literacy, content creation, and side hustles.

Half of Gen Z say they aspire to start their own business, according to McKinsey.

They are the most entrepreneurial cohort in modern history, raised in the slipstream of YouTube, TikTok, smartphones, and cryptocurrency.

Young people know how to create viral content and harness AI models. They are internet-native, fluent in tools that older generations can’t comprehend, and more willing to embrace risk in their portfolios.

Economic disillusionment aside, it would be wrong to say Gen Z is standing still.

Ideally, the story of Gen Z becomes one of reinvention. A narrative full of young people who stopped waiting for the world that boomers promised, who worked hard to improve the one that actually exists.

So if you’re reading this, it’s time to get to work. We have a future to build.

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About me

📰 I’m Phil Rosen, co-founder of Opening Bell Daily. I’ve published books, lived on three continents, and won awards for my journalism, which has appeared in Business Insider, FORTUNE, Yahoo Finance, Bloomberg and Inc. Magazine.

I write our flagship newsletter to prepare you for each trading day — unpacking markets, economic data and Wall Street with analysis you won’t find anywhere else.

Feedback? Reply to this email, ping me on X @philrosenn, or write me directly at [email protected].