Hey, Millennials! This is the sequence of success: education, job, marriage, children

Keep these milestones in order for the best chance of financial wellbeing.

Carolyn Moynihan | Jun 16 2017 | comment

Illustration from the Success Sequence report. IFS / AEI

Millennials may have it tough in a society where values and the job market seem equally disrupted, but here is what they need to know: the odds are that, financially at least, life will go much better if they follow the tried and true Success Sequence: education, job, marriage, children – in that order.

That’s the message of a new report on young adults in America by the Institute for Family Studies (IFS) and the American Enterprise Institute (AEI).

"The Millennial Success Sequence: Marriage, Kids, and the Success Sequence among Young Adults" is authored by IFS research director Wendy Wang and IFS senior fellow W. Bradford Wilcox. They analyzed panel data on young adults born between 1980 and 1984 from the Bureau of Labor Statistics (BLS) to determine how the sequencing of work, education, and marriage is linked to the economic outcomes of Millennials.

"Despite the many different routes that Millennials take on their journey to adulthood, one is associated with a higher chance of better financial well-being," says Dr Wang. "That path is the success sequence."

And yet, according to the data studied, here is what is actually happening:

A record 55% of Millennial parents (ages 28-34) have put childbearing before marriage
Only 40% of young adults ages 28 to 34 have moved into family life by marrying first
Some 33% have had children outside of or before marriage
And 27% have not reached either of these traditional milestones of adulthood

Results?

Some 53% of young adults who did not follow the success sequence at all are in poverty
But only 3% of young adults who passed through the success sequence in its entirety—including marrying first—are poor.

Here is a fuller summary of the findings, reproduced from the report, courtesy of the authors:

A record 55% of Millennial parents (ages 28-34) have put childbearing before marriage, according to a new analysis of Bureau of Labor Statistics’ Panel data by the American Enterprise Institute and the Institute for Family Studies. As the oldest of the nation’s largest generation, these Millennials were born between 1980 and 1984 and were surveyed between 2013 and 2014, in the latest wave of the National Longitudinal Survey of Youth 1997 (NLSY97).

By comparison, when the youngest Baby Boomers (born between 1957 and 1964) were the same age and became parents, only a quarter of them had their first child before marriage.

The rise of nontraditional routes into parenthood among Millennials is one indicator that today’s young adults are taking increasingly divergent paths toward adulthood, including family formation. In fact, when it comes to family formation, overall only 40% of young adults ages 28 to 34 have moved into family life by marrying first (regardless of whether they have had any children). Another 33% have had children outside of or before marriage, and a significant share (27%) have not reached either of these traditional milestones of adulthood.

By comparison, a majority of Baby Boomers (67%) had entered into family life at the same age by marrying first. A much smaller share had children before marrying (20%), or had delayed both parenthood and marriage (13%) at ages 28 to 34.

These divergent paths toward adulthood are associated with markedly different economic fortunes among Millennials. Young adults who put marriage first are more likely to find themselves in the middle or upper third of the income distribution, compared to their peers who have not formed a family and especially compared to their peers who have children before marrying. In other words, even though transitions to adulthood have become much more complex in recent decades, the most financially successful young adults today continue to be those who put marriage before the baby carriage.

Fully 86% of young adults who moved into marriage first have family incomes in the middle or top third. (Family income in this report is adjusted for household size and also applies to the incomes of unmarried adults.) In contrast, about half of Millennials who put childbearing first (53%) have incomes in the middle or top third. Young adults who are unmarried and childless fall in between: 73% of them have family incomes in the middle or upper third of the distribution.

This pattern holds true for racial and ethnic minorities, as well as young adults from lower-income families. For instance, 76% of African American and 81% of Hispanic young adults who married first are in the middle or upper third of the income distribution, as are 87% of whites. Likewise, 71% of Millennials who grew up in the bottom third of the income distribution and married before having a baby have moved up to the middle or upper third of the distribution as young adults. In general, Millennials who marry first are more likely to be on track to realizing the American Dream than those who put childbearing first.

Moreover, the link between marriage and economic success among Millennials is robust after controlling for a range of background factors. Compared with the path of having a baby first, marrying before children more than doubles young adults’ odds of being in the middle or top income tier, after adjusting for education, childhood family income, employment status, race/ethnicity, sex, and respondents’ scores on the Armed Forces Qualifying Test (AFQT), which measures intelligence and knowledge of a range of subjects.

Finally, 97% of Millennials who follow what has been called the “success sequence”—that is, who get at least a high school degree, work, and then marry before having any children, in that order—are not poor by the time they reach their prime young adult years (ages 28-34). The “success sequence,” so named by Brookings Institution scholars Ron Haskins and Isabel Sawhill, has been described as the path into adulthood that is most likely to lead towards economic success and away from poverty.

Since Millennials are more likely than older generations to delay both marriage and parenthood, this analysis categorizes unmarried, childless young adults as “on track,” so long as they have followed the other two steps relating to work and education. Similar to their peers who have followed all three steps of the success sequence, the “on track” young adults are doing relatively well financially, and 92% of this group are not in poverty.

Today, 31% of Millennials who obtained at least a high school degree (but didn’t follow the work and marriage steps) by their mid-20s are in poverty when they reach ages 28 to 34.3 Young adults who earned not only a high school diploma but also managed to have a full-time job (including those who were in college or married and home with children) in their mid-twenties are even less likely to be poor. Just 8% of Millennials who are “on track”—that is, had taken the first two steps of the success sequence but had neither married or had children—are poor. Finally, only 3% of young adults who passed through all three milestones associated with the success sequence in its entirety—including marrying first—are poor.

In contrast, 53% of young adults who did not follow this sequence at all are in poverty. Among black and Latino Millennials, as well as Millennials who grew up in low-income families, those who followed the success sequence are markedly less likely to be poor than their peers who did not. The association between following the success sequence and avoiding poverty remains robust after controlling for various factors such as education, childhood family income, race/ ethnicity, sex, and the Armed Forces Qualification Test.

Even though young men and women are taking increasingly divergent paths into adulthood in America today, panel data that tracks adults across the transition to adulthood indicate that the path most likely to be associated with realizing the American Dream is one guided by the success sequence.

Given the importance of education, work, and marriage—even for a generation that has taken increasingly circuitous routes into adulthood—policy makers, business leaders, and civic leaders should work to advance public policies and cultural changes to make this sequence both more attainable and more valued.

Among other things, this should include public and private efforts to strengthen career and technical education, expand the Earned Income Tax Credit or other wage subsidies, and publicize the value of the “success sequence” to adolescents and young adults across America.

Read the full report.

Watch the panel discussion at AEI.

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June 16, 2017

A man who evidently hated President Trump and Republicans in general shot two Congressmen from the party and several other people having a baseball game on Wednesday. He was shot in turn by police and died in hospital. Sheila Liaugminas reflects on the violent incident in her post today.

It seems that there are people motivated largely by hate, and perhaps they get together in groups sometimes, but can there be – as the Southern Poverty Law Center claims – nearly 1000 such groups in America at last count? And should a group that lobbies for conservative family values – and has consultative status at the UN – be counted, solely on that basis, as one of them? Surely not.

Yet that is how the SPLC portrays C-Fam (Center for Family & Human Rights), a New York and Washington DC-based research institute that advocates vigorously, but always civilly, for the protection of the family founded on marriage between one man and one woman – and related rights. The “poverty” activists would like to – in their own words – “completely destroy” groups like C-Fam.

Austin Ruse is president of C-Fam; read his account of the SPLC – a darling of big media – and wonder how this defamatory group of activists has been able to grow rich on the proceeds of false labeling in a democratic country like the United States.

There’s plenty of other good reading also in today’s line-up, so enjoy.