Tuesday, November 22, 2011

Young need Double Salary to Match Parents' Lifestyle

During our parents' generation, there were a small percentage of graduates with degrees. Most of our parents had high schools (secondary schools) qualifications but, they were able to find clerical or office jobs with decent pay and able to survive and support their families. Those who managed to graduate with degree papers, they had higher opportunities in job promotions and better salaries. During our parents' generation, they were able to get good meals for a decent price like, a few cents. As for their living standard was considered manageable, they were able to raise at least 4 children by giving the children with better education to colleges and universities from their small income earnings.

When it comes to our generation, the Generation X who born from early 1960s to early 1980s, we were still able to get clerical or white collar jobs even though we had high schools (secondary schools) qualification or Diploma papers. Most of the companies were willing to hire workers with high school qualifications or Diploma papers. At that time when we reached early 20s year old, between 50%-60% of this generation X graduated with degree papers. Although our starting salary was slightly higher than our parents' generation, we were still be able to support and survive in cities. As we are heading to 40s year old soon, we have already gone through the hardships to earn more money for buying property, marriage and raising children. We also struggle through hard times to strive for higher salaries and better job promotions in order to save more money for children's higher education and our retirement at later stage. However, the Generation X might be in jeopardy situation due to the uncertainty of the current economic crisis. They face higher risks to be the first batch to be laid off (unemployed) and restructured with pay cut, more than younger generations.  

Unfortunately, the younger generations of Generation Y & Z who born after early 1980s through to the present, they begin to feel bigger pressure to survive with low salaries. Nearly every child has the opportunity to enroll and graduate with masters and degrees in colleges and universities. Parents are willing to sacrifice to save money and sell their properties to give their children the best education as they can. Even the families from villages and farming and agriculture industries are also doing the same thing so that they are able to send their children to colleges and universities. Parents always believe that graduates with masters or degrees qualification, they will have better career prospects and salaries as white collar workers in offices rather than being blue collar workers with low wages. Like in China, Chinese parents will do anything to ensure that their children won't follow their footstep in farming and agriculture industries. Thus, more young generation graduate with masters and degrees papers, tend to move to cities in China for better prospect while leaving less young adults to stay in villages and work in farming and agriculture industries. The drastic of lifestyle changing and widening the wealthy gap can been seen in China since after China opened its free trade market to the world in early 1980s. The rich gets richer with business expansion in China and overseas market while the average and poor become poorer. As such, more Chinese university graduates are known as "ant tribe" who are struggle with low pay and live in poor condition without feeling secured with their jobs. Most of them don’t have labour contracts with their employers and are not entitled to any social or medical insurance. It's all because of over supply of degree and master Chinese graduates to fight for the limited job opportunities in the market.

It isn't happening in China only but we begin to see the trend of unequal wealthy gap in many developed countries in Europe, the U.S. and Asia regions. We see the rising costs of living expenses, food and property which become more burden and difficulties for the young generations to support themselves and their families. Although the younger generations are getting higher salary compared to our parents' generation but still, they are unable to survive and save as much as our parents do. Have the value of currencies depreciated a lot throughout the generations?

Like in China, more and more young generation migrate to the cities for better career prospects in white collars, we see a big decline in food supply. Less young adults are willing to work or take over their parents' farming and agriculture businesses. Food pricing becomes more expensive due to limited supply in order to feed more than 7 billion of human population on the earth. Properties become more expensive and unaffordable in most of the developed cities in Europe, the U.S., China, Asia, Australia and New Zealand because we see a big trend of migration from small towns and villages to the cities. Immigration is also another factor to the rising costs of the property in the developed countries. 

Since most of the young adults from Generations Y & Z are heading to earn degrees or masters in colleges or universities in order to compete and land into white collar jobs. It turns out that in today's society, the specialized jobs or blue collar jobs with specialized training, licensing or certification become more lucrative and highly demanding in the market.


The rising cost of living revealed: How young need 'twice the salary to match parents' lifestyle'

By Becky Barrow Last updated at 10:44 AM on 18th February 2011

Young workers would need to earn twice as much to have the lifestyle their parents enjoyed at the same age, research reveals today.
The dramatic salary increase would make it easier for them to marry, buy a home and have children – choices within easier reach of earlier generations.
The report said the average twenty-something earns about £21,000 – but would require £40,000 to match their parents.

Struggle: Research has revealed that huge financial deficits facing young couples 
are resulting in them delaying key stages in life, such as buying a home (photo: Daily Mail)

The massive financial deficit is forcing young people to delay key life stages, according to First Direct, the bank which commissioned the report.
‘Three in ten of their parents were married and on the property ladder by the age of 25,’ it said. ‘But money worries mean the average young Briton today does not expect to pass these milestones until their mid-30s.’
Three in four of the 3,000 polled for the study agreed with the contention that today’s young people ‘are the most financially pressured in history’.
One in five has postponed, or feels they should postpone, marriage plans. One in four is delaying having children.
Nearly a third are even considering not having children at all ‘because they cannot afford to do so’, according to First Direct which calls them ‘Generation Gap’. One of the biggest problems for twenty-somethings is the enormous cost of buying a property.
A couple who married in 1985 could have picked up a home for just £35,000 – the average price at the time and four times the average salary.
A child born to the couple two years later would now be 24 and need to find £163,000 for a similar house – eight times the average salary.
To make matters worse, the study shows that a university education would have left them with debts averaging £11,500. Taken together the financial pressures can make it all but impossible to buy a house or have a child.
Salaries are also under great pressure with a typical private sector worker able to expect a pay rise of only 1.7 per cent. State workers who get paid £21,000 or more are facing a two-year pay freeze.
The consequences for women can be devastating if money problems make them delay trying for children until they are in their late 30s and even 40s. By then, their chances of having a healthy baby have declined dramatically.

Source: http://www.dailymail.co.uk/news/article-1358161/The-rising-cost-living-revealed-How-young-need-twice-salary-match-parents-lifestyle.html#ixzz1eTRbHOkJ

Cost of living crisis pushes 'squeezed middle' off the housing ladder

People on low to middle incomes have had their ability to buy their own homes dramatically reduced
By , Political Editor guardian.co.uk,

People on low to middle incomes are facing a "perfect economic storm", which is cutting their living standards and dramatically reducing their ability to buy their own homes, new research will show this week.
The independent Resolution Foundation is to launch a major inquiry into living standards among the so-called "squeezed middle", having identified economic trends – in existence since the 1970s – that have led wages for this income group to grow at a slower rate than the economy.
It defines low and middle earners as those with incomes between £12,000 and £30,000 for a couple with no children and up to £48,000 for a couple with three children. Broadly, they are defined as not wealthy enough to benefit from private markets but too prosperous to receive benefits from the state.

The foundation will say that 41% of young low-to-middle earners live in privately rented accommodation compared with 14% in 1988, suggesting a dramatic reduction in the number of those who can afford to get on the housing ladder.
It will also highlight evidence showing that someone at the lower end of these incomes will take 45 years to accumulate a deposit to buy a home if they save an average 5% of their income a year. This compares with less than 10 years during periods in the 1980s and 1990s.
The foundation, which is not allied to any political party, says low-to-middle-earning households have become more exposed as a result of the recession and the contraction of the consumer credit and mortgage markets, alongside recent rises in the cost of living.

Source: http://www.guardian.co.uk/business/2011/feb/26/cost-of-living-crisis-housing


As Asia booms, what is cost of success for its young

Increased prosperity

Economic growth in East and South Asia is seen running at close to 7% over the next year, according to a United Nations (UN) report on economic prospects.
That easily outstrips the slower expansion expected in debt- and recession-hit Europe and US.

Generation Asia graphic
Population of 0-29-year-olds as percentage of total population in 2010
  • China 43.8%
  • Hong Kong 31.5%
  • Japan 29.2%
  • Cambodia 64.7%
  • Indonesia 54%
  • Laos 66%
  • Malaysia 56.6%
  • Phillippines 63.7%
  • Singapore 38.3%
  • Thailand 43.4%
  • Vietnam 53.4%
  • India 58.3%
Source: UN Economic and Social Commission for Asia and the Pacific

At the same time, for hundreds of millions of people across the region, their earning power and standard of living are increasing.
Wages rose by 8% across Asia in 2009, mostly driven by China, according to the International Labour Organization (ILO).
That compares with 0.6% growth in more developed countries during the same period.
The youth unemployment rate, meanwhile, has been below 15% in most of the region for the last five years.
Compare that with figures of more than 30% in European economies such as Italy and Spain, and it is clear that more young people in Asia are getting greater opportunities to work.
"There's been increasing prosperity," says Marco Roncarati of the UN's Economic and Social Commission for Asia and the Pacific.
"If you look at the last 20 to 30 years, we see that aggregate levels of development have improved."
This focus on youth employment is particularly important because Asia is the region with the most young people in the world.
According to UN figures, 62% of the world's 15- to 24-year-olds live in Asia. Put more simply, it means that almost two out of every three people in that age group are in this region.
In terms of total numbers, that meant there were 745 million young adults in Asia in 2010, according to a report by the UN Department of Social and Economic Affairs.
As a result, a number of countries in the region are experiencing a "youth bulge", where people between the ages of 15-24 make up the largest demographic segment of the population.
A look at the median age shows that the Philippines, Cambodia and Laos have some of the youngest people in Asia, with a median age of around 22.
That compares with a figure of almost 40 in the UK, according to the UN.

Global youth populations

High expectations 
But while many of the region's youth are experiencing greater success, this also brings its own set of problems.
Young Asians today expect a lot more from their lives, and often face pressures that were unfamiliar to earlier generations.
Noreen, 26, lives in Hong Kong and counts herself as lucky because she went to the UK for her undergraduate degree.
"I went to university, whereas my parents didn't," she says, adding that, as a result of her foreign studies, she has the tools to make a better life and achieve the "upward mobility" that eluded so many of her parents' generation.
However, Noreen also has goals in life that she is not sure she can achieve, given the rapidly rising cost of living, not least owning her own home.
"I'd like to move out before I'm 30. I'd want to start my own family, have more privacy," she says.
But "it's difficult to save money for a down payment in Hong Kong. It's too expensive", she adds.

Hong Kong skyline 
High property prices in major Asian cities mean owning a home is not possible for many youth (photo: BBC)

Noreen is not alone, and this pattern is repeated across the more developed parts of Asia, such as Japan, China, South Korea and Singapore.
At the same time, frustration among the young is being stoked by the fact that while employment and spending power may be increasing as a whole, so is the competition for the jobs and resources that are on offer.
What this means is that even though they are making more money and are better qualified than before, for millions of young Asians, it is getting increasingly difficult to get ahead.
"It's universal, all young people want to succeed and they want to move upwards," says Noreen. "Any society or economy where there is no room to move upwards, young people get frustrated."

'Working poverty'  
India is one country where the problems facing many of Asia's youth are brought into sharp focus.
It is home to 714 million people under the age of 30, and while times are improving for many of them, a widening wealth gap has created vastly different fortunes.
For 21-year-old Mohammad in Mumbai, Saturday night is not about nightclubs and having a good time.
So while many of his peers are downing drinks and dancing, Mohammad is busy pouring milk into containers, loading them onto his bicycle and delivering them to nearby restaurants.

Youth unemployment

“Start Quote

There are by far more young people around the world that are stuck in circumstances of working poverty than are without work or looking for work”
Global Employment Trends for Youth: 2011 Update International Labour Organisation
Educated with the equivalent of a High School diploma, he has been doing the job for the past two years, earning as much as 5,000 rupees a month ($102; £64).
"I am in need, so I am doing this job," Mohammad explains. "Whatever I earn is not enough."
According to the ILO, South Asia and Sub-Saharan Africa are now home to the largest number of "working poor".
The term, as defined by the ILO, is a measure of people who work but live in households where total expenditure is less than $1.25 (£0.8) a day.
In its latest report on youth unemployment, the ILO says that in the least-developed regions the poor cannot afford to be unemployed for too long.
"They have to do something. They have to scrounge for food and therefore engage in some activity, but they are not fully employed," says Sarah Elder from the ILO.
While this type of work may help lower the unemployment figures, in reality it does little to improve the lives of many of the region's young.
"There are by far more young people around the world that are stuck in circumstances of working poverty than are without work or looking for work," the ILO claims.
Growing frustration? Back at the nightclub in Singapore, the party continues for Nicol and his friends.
Even though he is enjoying the trapping of success, Nicol is clear about what needs to happen in the future if Asia's young are to keep buying into the region's sense of optimism.
"We are not seeing public anger because the fact that we are growing economically helps paper over that anger," he explains.
"When people are not getting raises, and real wages start to stagnate, that's when you'll see that anger come out."
The question now is how well governments can manage the expectations of Asia's new generation.
If they get it wrong, then they may find it an almost impossible task to ignore the frustrations of three quarters of a billion young people.
(Additional reporting by Kinjal Pandya in Mumbai.)

Source: http://www.bbc.co.uk/news/business-15532821 

College grads forced to slums

China’s young professionals struggle to make ends meet because of rising living costs

By Chi-chi Zhang Associated Press   Thursday, July 1, 2010

 Associated Press photographs Shang Meirong, 21, (right) and friends play computer games 
in her rented room in Tangjialing, China. Rising living costs have hit college graduates.

TANGJIALING, China | Liu Jun sleeps in a room so small that he shares a bed with two other men. It’s all the scrawny computer engineering graduate can afford in a city so expensive that the average white-collar professional can’t afford to buy a home.
A dim fluorescent bulb hangs from the ceiling of the 180-square-foot room on the fringes of Beijing. The floor is littered with cigarette butts, dirty laundry and half-eaten paper bowls of spicy instant noodles.
“This is what I get for living with two guys,” the 24-year-old Mr. Liu says, hunched near a pile of used computer parts. He’s a chain-smoker who speaks rapid-fire fast. “It’s not just the mess and lack of privacy, but it’s also embarrassing to bring girls home.”
The dreams of many young educated Chinese are running up against the realities of China’s rapid economic ascent. Rising living costs and low salaries - the result of a surfeit of university graduates - are dashing high expectations.
His home is about an hour north of downtown Beijing, down a tree-lined path where a rusty sign welcomes newcomers. Once a small village of farmers and laborers, Tangjialing emerged as a cut-rate bedroom community in 2003 after the opening of massive software parks nearby, including the headquarters of computer-maker Lenovo Group and the widely used Internet search engine Baidu.com.
Now four- to six-story cement buildings in pastel hues dot the village. Most rooms contain little more than a wardrobe, a bed and a nightstand. There’s no air conditioning in weather that can reach above 100 degrees. Rent is $45 to $100 a month. Those willing to pay $15 more get a bathroom. Others use the public bath.
The term “ant tribe” was coined by Lian Si, a professor who wrote a book with that title about the post-1980 generation.
“Unlike slums in South America or Southeast Asia, these villages are populated with educated young people as opposed to laborers or street peddlers,” says Mr. Lian, who teaches at the University of International Business and Economics in Beijing.
The Chinese born after 1980 are among the most privileged generation in China’s long history. Living after the communist government gave up the radical politics that tossed their parents and grandparents between chaos and penury, they have known only ever-rising levels of prosperity.
In their lifetimes, gleaming new office towers have remade China’s cities. Hundreds of millions have been lifted from poverty. Travel abroad, private cars and apartments. and a university education - all once the preserve of the elite - are increasingly common.
Vibrant megacities such as Beijing and Shanghai are the epitome of this good life. So the ant generation comes, bringing its aspirations.
But their very abundance keeps entry-level salaries low, while housing and other costs rise. Real estate prices have doubled in just three years in major cities, outpacing a 40 percent increase in urban wages from 2005 to 2009.
“This is the biggest struggle for China’s young generation today,” says Liu Neng, a sociology professor at Beijing University. “People in their 40s and 50s, now leaders in society, have already experienced hardships, but it’s the younger generation’s turn to face challenges before they become part of the country’s elite.”
The competition for jobs is fierce. Nearly 70 percent of high school graduates are expected to enroll in university this year, according to state media, compared with 20 percent in the 1980s. There are more college graduates than readily available jobs - a once unthinkable situation.
“Trying to find a job that pays enough to survive is much harder than I imagined,” says Ren Yanguang, who makes $150 a month as an intern at a local software company in Beijing, where the average income is four times that. “It’s frustrating because if I don’t find a job soon, then I’ll have no choice but to leave.”
Most Tangjialing dwellers, Mr. Lian says, come from farms and small cities and don’t want to return, fearing the boredom or being labeled failures.
“It sure sounds good if you’re a parent and you tell the whole village your son is working in the capital,” Mr. Lian says. “And it’s a huge deterrent because they want their family to be proud.”
For Mr. Liu, the computer engineer, coming to the capital city was a chance to live China’s version of the American dream. In his final year at Northeast Petroleum University, he rebuffed his parents’ efforts to get him a cushy job at a state-owned company back home in Jixi city. “I came to Beijing because I wanted freedom from them, too,” Mr. Liu says.
He wound up in Tangjialing late last year, about eight months after moving to Beijing. The village is near the software park where he landed a job, and he recruited two college classmates as roommates.
For about $90 a month, they got one of the better rooms, furnished with a queen-sized bed, two desks and a small wardrobe. It has a bathroom and, unlike the cheaper apartments, a small window that lets in slivers of light. They have attached a lounge-chairlike folding bed to the mattress in case someone rolls over or wants to spread out.
On the evenings he and his roommates aren’t clocking overtime, they grab dinner together - often instant noodles but sometimes stir-fried shredded pork and vegetable dishes bought nearby.
Entertainment is mostly chatting online with friends or playing computer games. Without much money, Mr. Liu confesses on his blog, life in the big city can be quite dull at times.
After taking a new job selling computer hardware in April, Mr. Liu’s $30 share of the rent allows him to set aside much of his $400 salary for a nest egg that he hopes will help him start his own software company one day.
“I always ask myself if it’s worth it,” he says. “When I was in school, this isn’t how I wanted life to be, but I chose this path so I can’t look back.”

Source: http://www.washingtontimes.com/news/2010/jul/1/college-grads-forced-to-slums/?page=1

In the USA:

Upward mobility in the USA

Americans continue to think that their society is egalitarian but the data suggest otherwise

A family collecting perishable and non-perishable food at a food centre in Gaithersburg, Maryland. 
A record number of Americans are counted among ‘poorest poor’ which inhibits their upward mobility. (Photo: NST)

This week's Washington Post-ABC News poll reveals what we have all sensed, that most Americans are increasingly concerned about the growing gap between rich and poor in this country.
The issue quickly divides along partisan lines, as do so many, with liberals urging the government to do more to reduce this gap and conservatives opposing such measures. (Overall, a significant majority does favour government action.)

But on an issue even more significant than income inequality, there does appear to be bipartisan agreement: the importance of social mobility. Indiana Republican Gov Mitch Daniels accurately noted that "upward mobility from the bottom is the crux of the American promise".

Some believe we're still doing fine. In his address to the Heritage Foundation last month, Representative Paul Ryan  declared: "Class is not a fixed designation in this country. We are an upwardly mobile society with a lot of movement between income groups." Ryan contrasted social mobility in the United States with that in Europe, where "top-heavy welfare states have replaced the traditional aristocracies, and masses of the long-term unemployed are locked into the new lower class".

In fact, growing evidence shows pretty conclusively that social mobility has stalled in this country. This week, Time magazine's cover asked, "Can you still move up in America?" The answer, citing a series of academic studies was, no; not as much as you could in the past and -- most devastatingly -- not as much as you can in Europe.

The most comprehensive comparative study, done last year by the Organisation for Economic Cooperation and Development, found that "upward mobility from the bottom" -- Daniels' definition --  was significantly lower in the US  than in most major European countries, including Germany, Sweden, the Netherlands and Denmark.

A 2010 Economic Mobility Project study found that in almost every respect, the US  has a more rigid socioeconomic class structure than does Canada.

More than a quarter of US sons of top-earning fathers remain in the top tenth of earners as adults, compared with  18 per cent of similarly situated Canadian sons.

US sons of fathers in the bottom tenth of earners are more likely to remain in the bottom tenth of earners as adults than are Canadian sons (22 per cent v 16 per cent). And US sons of fathers in the bottom third of earnings distribution are less likely to make it into the top half as adults than are sons of low-earning Canadian fathers.

Surveying all the evidence, Scott Winship, a fellow at the Brookings Institution, concludes in this week's National Review: "What is clear is that in at least one regard American mobility is exceptional. Where we stand out is in our limited upward mobility from the bottom."

When you think about it, these results should not be so surprising. European countries, perhaps haunted by their past as class-ridden societies, have made serious investments to create equality of opportunity for all. They typically have extremely good childhood health and nutrition programmes, and they have far better public education systems than the US does. As a result, poor children compete on a more equal footing against the rich.

In the US, however, if you are born into poverty, you are highly likely to have malnutrition, childhood sicknesses and a bad education. The dirty little secret about the US welfare state is that it spends  little on the poor -- who don't vote much -- lavishing attention instead on the middle class.

The result is clear. A student interviewed by Opportunity Nation, a bipartisan group founded to address these issues, put it succinctly, "The ZIP code you're born in shouldn't determine your destiny, but too often it does."

Tackling income inequality is a difficult challenge. Tax increases on the rich will do relatively little to change the basic trend, which is fuelled by globalisation, technology and the increasing gains conferred by education. (Getting back to 1990 levels of income distribution in the US, for example, would mean hundreds of billions of dollars of redistribution every year, which is exponentially larger than the biggest tax hikes anyone is proposing.)

But we do know how to create social mobility -- because we used to do it. And we can learn from those countries that do it so well, particularly in Northern Europe and Canada. The ingredients are obvious: decent healthcare and nutrition for children, good public education, high-quality infrastructure -- including broadband Internet --  to connect all regions and all people to market opportunities, and a flexible and competitive free economy. That will get America moving again --  and all Americans moving again.

Source: http://www.nst.com.my/opinion/columnist/upward-mobility-in-the-usa-1.5097#ixzz1eTq5rN5S

(updated on 29 Nov 2011:) MSNBC reported that more American families rely on food stamp during this economic recession. Idaho (one of the states in the USA) reported its unemployment rate of 9.1% and its food stamp participation has increased by 15% in the state itself. If the U.S. government has to release the actual report on its unemployment and food stamp participation throughout the nation, it'll be shocking to the world. Although the recent research that a a family with 2 children with monthly income of less than US$3,000 is considered as below poverty level, I feel that it's not accurate at all. If a family with 2 children live in a small town then, the household income of $3,000 per month might be sufficient to survive. However, if a family with 2 children live in metropolitan cities such as San Francisco, Los Angeles, New York etc. where the home property costs at least US$500,000 or more, it's impossible to survive with the household income. Children's education isn't free in the U.S.A. It depends on the neighbourhood you live. If you live above average/rich neighbourhood, then you will be assured that your children will be enrolled to good schools but if you live poor or average neighbourhood then, your children don't enjoy the same privilege as the children from the above average or rich neighbourhood. Besides that, parents also need to give generous donations to schools yearly as well as paying for the children's sports activities participation in schools. Visiting doctors or admitting to hospitals aren't cheap if the family isn't covered with medical insurance. The cost of healthcare insurance (medical insurance) keeps rising each year which becomes unaffordable to poor and average families. Apart from that, the Americans must pay the state income tax and the sales tax (service tax or VAT tax) on top of the federal income tax. The state income tax and sales tax is different for every state in the United States. California and New York are the most developed states which impose higher state income taxes and sales taxes compared to other states in the USA. Therefore, I believe that the monthly income for a family with 2 children in a city, has increased to at least US$8,000 per month in order to pay for the loan and mortgage, taxes (income and sales taxes), healthcare/medical insurance, home and other expenses as well as children' education.

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