The Next America

1. Demographic shifts are reshaping America's generational landscape

Change is the constant.

Generational composition. America is experiencing unprecedented demographic changes, with four distinct generations shaping its landscape:

• Millennials (born after 1980): Largest generation, diverse, digitally native, facing economic challenges
• Generation X (born 1965-1980): Smaller cohort, pragmatic, often overlooked
• Baby Boomers (born 1946-1964): Large generation entering retirement, redefining aging
• Silent Generation (born before 1946): Oldest group, conservative, rapidly declining in number

Key trends:

• Increasing longevity and declining birth rates leading to an aging population
• Growing racial and ethnic diversity, especially among younger generations
• Delayed milestones of adulthood (marriage, homeownership, parenthood) among Millennials
• Shifting values and attitudes across generations on issues like politics, religion, and social norms

2. Millennials and Boomers: Contrasting fortunes and perspectives

Millennials are America's most stubborn optimists.

Economic realities. Millennials face unprecedented economic challenges compared to Boomers at the same age:

• Higher student debt
• Lower homeownership rates
• Stagnant wages and job insecurity
• Delayed financial independence

Contrasting outlooks. Despite economic hurdles, Millennials maintain optimism:

• 89% believe they will have enough money to meet their needs
• More liberal and diverse in their political views
• Embrace technology and social change
• Value experiences over material possessions

Boomers, meanwhile, are entering retirement with mixed feelings:

• Many are financially unprepared for retirement
• Concerns about Social Security and Medicare sustainability
• Grappling with changing social norms and technological advancements
• Sandwich generation caring for both parents and adult children

3. The decline of marriage and traditional family structures

Marriage has become a status symbol.

Shifting norms. Marriage rates have declined dramatically, especially among younger generations:

• In 1960, 72% of adults were married; in 2011, only 51% were
• Median age at first marriage has risen by about 6 years for both men and women

Factors contributing to decline:

• Economic uncertainty and desire for financial stability before marriage
• Changing social norms and acceptance of cohabitation
• Increased educational and career opportunities for women
• Rise of individualism and personal fulfillment as life goals

Consequences:

• Increase in single-parent households and children born to unmarried mothers
• Growth of multigenerational households as economic coping strategy
• Redefinition of family to include diverse arrangements (same-sex couples, blended families, etc.)
• Potential long-term impacts on social stability and economic well-being

4. Rising religious disaffiliation and changing spiritual landscape

The US is still the most religiously observant nation among the world's great powers. But led by today's young, it's growing more pluralistic and less connected to traditional religious institutions.

The rise of the "nones". A growing portion of Americans, especially Millennials, identify as religiously unaffiliated:

• 20% of all adults and 33% of those under 30 are religiously unaffiliated
• Includes atheists, agnostics, and those who believe in God but have no religious affiliation

Factors driving disaffiliation:

• Generational replacement (younger cohorts less religious than older ones)
• Delayed marriage and parenthood
• Political backlash against conservative religious involvement in politics
• Broader social disengagement and decline in institutional trust

Implications:

• Changing social and political landscape as religious influence wanes
• Potential shifts in moral and ethical frameworks
• New challenges for traditional religious institutions in maintaining relevance
• Emergence of alternative forms of spirituality and community

5. Digital technology's transformative impact on society

Technology will be so seamlessly integrated into our lives that it will effectively disappear.

Digital natives. Millennials are the first generation of digital natives, fundamentally reshaping how society interacts, learns, and works:

• Constant connectivity and information access
• Social media as primary communication and self-expression platform
• Blurred lines between online and offline identities

Impacts across generations:

• Changing work patterns (remote work, gig economy)
• New forms of entertainment and media consumption
• Shifts in privacy expectations and data sharing
• Evolving social norms and etiquette

Challenges and concerns:

• Digital divide between generations and socioeconomic groups
• Information overload and attention fragmentation
• Cybersecurity and online safety
• Potential negative impacts on mental health and social skills

6. Economic challenges and wealth disparities between generations

The young today are paying taxes to support a level of benefits for the old that they themselves have no prospect of receiving when they become old.

Widening wealth gap. The economic fortunes of young and old have diverged dramatically:

• In 1984, the typical household headed by someone 65+ had 10 times the net worth of one headed by someone under 35
• By 2011, that ratio had ballooned to 26:1

Factors contributing to disparity:

• Great Recession's disproportionate impact on younger workers
• Rising education costs and student debt
• Stagnant wages and job market instability for younger workers
• Housing market changes favoring established homeowners

Long-term implications:

• Delayed financial independence and major life milestones for younger generations
• Potential for reduced economic mobility and widening inequality
• Strain on social safety net programs as population ages
• Shifting consumption patterns and economic growth dynamics

7. Immigration's role in shaping America's future

If we adopt immigration policies that allow us to keep winning the global lottery for newcomers with brains, talent, and drive, we'll go a long way toward ensuring our place as the top dog in the world's economy.

Demographic impact. Immigration is reshaping America's population:

• By 2050, 37% of the US population will be immigrants or their US-born children
• Immigrants and their children will account for 90% of US workforce growth through mid-century

Economic contributions:

• Fill crucial labor gaps across skill levels
• High rates of entrepreneurship and innovation
• Younger age profile helps offset aging native-born population

Challenges and debates:

• Integration and assimilation concerns
• Political controversies over illegal immigration and border security
• Strain on public services in some communities

Future outlook:

• Continued importance of immigration for economic growth and innovation
• Potential shifts in immigration patterns due to global demographic changes
• Ongoing political debates over immigration policy and reform

8. The looming crisis in Social Security and Medicare funding

Social Security and Medicare are the most popular, successful domestic programs the federal government ever created. They are a profound expression of the idea that as a nation, we are a community, all in this together.

Unsustainable trajectory. The current funding model for Social Security and Medicare is facing severe challenges:

• By 2026, the Medicare trust fund will be empty
• By 2033, the main Social Security trust fund will be insolvent

Driving factors:

• Aging population with fewer workers supporting more retirees
• Increasing life expectancy extending benefit payout periods
• Rising healthcare costs straining Medicare resources

Potential solutions and trade-offs:

• Raising retirement age
• Increasing payroll taxes
• Reducing benefits, especially for higher-income seniors
• Means-testing benefits
• Encouraging private savings and investment

Political challenges:

• Strong public support for maintaining current benefit levels
• Reluctance of politicians to tackle politically sensitive issue
• Generational tensions over fairness and sustainability of system

9. Racial and ethnic diversity: America's changing face

America isn't about to go color-blind; race is too hardwired into the human psyche. But race is becoming more subtle and shaded, and most Americans (especially the young) are at ease with the change.

Demographic shift. The US is becoming increasingly diverse:

• By 2043, non-whites will become the majority of the US population
• Millennials are the most racially and ethnically diverse generation in US history

Key trends:

• Rising interracial marriage rates and multiracial identities
• Increasing Hispanic and Asian populations due to immigration
• Declining share of non-Hispanic whites, especially among younger cohorts

Implications:

• Changing political landscape and voting patterns
• Evolution of cultural norms and national identity
• Potential for increased social cohesion or tension
• Economic impacts as workforce demographics shift

Challenges:

• Persistent racial inequalities in education, income, and wealth
• Evolving nature of racial discrimination and bias
• Balancing diversity with social cohesion and shared national identity

10. Balancing commitments to the old without burdening the young

Every generation should pay its own way.

Intergenerational equity. The challenge of maintaining support for older Americans while investing in future generations:

• Growing share of federal budget devoted to Social Security, Medicare, and Medicaid
• Reduced investment in education, infrastructure, and research that benefit younger generations

Potential approaches:

• Gradual reforms to entitlement programs to ensure long-term sustainability
• Increased investment in education and workforce development for younger generations
• Policies to promote economic growth and job creation
• Encouraging longer working lives and phased retirement

Family dynamics:

• Increasing importance of intergenerational support within families
• Growth of multigenerational households as economic coping strategy
• Potential strain on middle-aged "sandwich generation" caring for both parents and children

Path forward:

• Need for political leadership to address long-term challenges
• Importance of fostering intergenerational dialogue and understanding
• Balancing short-term political pressures with long-term sustainability
• Reimagining social contract for a demographically transformed America

Last updated: September 28, 2024