Silicon Valley is tossing millennials aside like yesterday's laptop.
The commonly held belief is that with hard work and a good education, a young person in America can get a good job. But despite falling unemployment, college grads age 22 to 27 are stuck in low-paying jobs that don't even require a college degree. The percentage of young people languishing in low-skill, low-paying jobs is 44%, a 20-year high
Only 36% of college grads have jobs that pay at least $45,000, a sharp decline
from the 1990s, after adjusting for inflation. Perhaps most depressingly, the percentage of young people making below $25,000 has topped 20%
, worse than in 1990. In other words, those with a bachelor's diploma were better off before the digital revolution.
If this comes as a surprise, that's because images from popular culture push the idea that young college graduates are shrugging off bad employment prospects with their do-it-yourself attitude. In our collective imagination, millennials are saying, "No jobs? That's OK — I'll create my own!" And then they solve their own problems by heading to Silicon Valley with little more than an iPhone and an idea to create the next hip app that supposedly will turn them into overnight millionaires.
A fictional example of this new breed of young idealistic entrepreneur would be Mike Bean, founder of Internet behemoth Gryzzl on the show "Parks and Recreation." Played by Blake Anderson, Bean might best be described as "barefoot and pregnant with ideas." The bumbling entrepreneur conquers the world practically by accident, armed only with his digital savvy, a can-do spirit, and a penchant for invading users' privacy. You get the idea that his success came easily.
Privacy concerns aside, the Mike Beans of America are just about as rare as the Mark Zuckerbergs. In fact, the percentage of people under 30 who own private businesses has reached a 24-year low
. Garages across the country are not exactly humming with millennials launching tech startups.
But wait — won't the digital economy eventually lead to better jobs? After a period of adjustment, won't things get better? Unfortunately that's not the path we're on. One of the biggest misconceptions about the digital economy is that for every middle-class job rendered obsolete by technology, there's a new, equally good (or better) job created by Silicon Valley.
But exactly the opposite is happening. The digital economy is vaporizing the good jobs and replacing them with two kinds of jobs: minimum wage jobs (think Amazon warehouse employees) and so-called "sharing-economy jobs" (think Uber drivers).
The sharing-economy jobs are even worse than minimum wage jobs because they offer no stability or protections for workers. Sharing economy jobs aren't really jobs at all; they're freelance gigs.
Sure, Silicon Valley doesn't owe America jobs. But something is wrong with the picture of a handful of tech billionaires overseeing a kingdom of falling wages, decreased worker protection and zero job security.
This "winner-take-all" digital economy is not sustainable. People on both sides of the political spectrum are worried. Liberal luminary Robert Reich, a professor at the University of California at Berkeley and former secretary of labor under Bill Clinton, calls the sharing economy the "share-the-scraps
" economy. Speaking of tech companies that utilize on-demand labor, such as Uber, Instacart and Taskrabbit, he says, "The big money goes to the corporations that own the software. The scraps go to the on-demand workers."