The UK's current young generation earned £8,000 less during its 20s than its predecessors and ran the risk of being the first cadre of workers in modern times to see lifetime earnings fall, according to new research.
Highlighting the UK's growing inter-generational economic divide, the Resolution Foundation's study showed millennials aged between 15 and 35 fared significantly worse than their parents in Generation X during their first years of employment.
According to the study, the deep recession of 2008-9 and the subsequent slow recovery was responsible for the pay penalty suffered by millennials, with earnings for young people getting squeezed even before the start of the financial crisis.
The report was released by the Resolution Foundation on Monday to mark the launch of an Intergenerational Commission, which included members Frances O'Grady, general secretary of the TUC, and Carolyn Fairbairn, the director general of the CBI.
David Willetts, executive chair of the Resolution Foundation and chair of the Intergenerational Commission, said, ''Fairness between the generations is something public policy has ignored for too long. But it is rising up the agenda with the prime minister, politicians of all parties, business leaders and others rightly identifying it as a growing challenge,'' The Guardian reported.
The research showed that people aged between 15 and 35 had been hit hardest by recent pay squeezes.
The report warned of the ''growing divide between a more prosperous older generation and a struggling younger generation'' as said by Prime Minister Theresa May in her leadership speech last week.
The report highlighted that inequality would continue to grow for younger millennials who had entered the jobs market after the financial crisis.
Consequently, "baby boomers" were 50 per cent more likely to own their home by the time they were 30, as against millennials today, which meant the younger generation spent £44,000 more on rent by the age of 30.
''We've taken it for granted that each generation will do much better than the last – earning more and enjoying a higher standard of living," Evening Standard's online edition quoted Torsten Bell, director of the Resolution Foundation. "But that approach risked looking complacent given the realities of recent years and prospects for the future."