Young need to follow, vote on policies that hurt them

ON THE JOB

October 10, 2007|By HANAH CHO

It's tough being a young professional in Baltimore. Actually, anywhere, for that matter.

That's according to local economist Anirban Basu, who spoke to a group of 20-something professionals on the economics of being young at an event last week sponsored by the Maryland Business Council.

The reason?

"In today's policymaking environment, young people are treated so poorly," argues Basu, chairman and chief executive of Sage Policy Group Inc., a Baltimore economic and policy consulting firm.

Consider some issues that matter to young people, such as education and housing.

The cost of higher education, in particular, is hitting young people's wallets. Basu points out that tuition is climbing while public funding for higher education is falling. So students are increasingly tapping into what Basu calls a cottage industry of private loans.

The Project on Student Debt, a nonprofit advocacy group, says the Class of 2006 graduated with an average debt of roughly $21,200.

Of course, college students of past generations also carried loans, but a recent report by the Associated Press speaks specifically to the consequence of students taking out private loans, which carry fees and variable interest rates.

"Many in the next generation of workers will be so debt-burdened they will have to delay home purchases, limit vacations, even eat out less to pay loans off on time," says the article, which is based on interviews with college graduates and industry experts.

Basu argues that public policies have made it difficult for first-time buyers and young people to participate in the real estate market.

In the Baltimore region, for instance, limits on new building permits have forced developers to serve more affluent customers, who can afford the pricey homes they're building, Basu says.

"If I'm in a permit-constrained environment and I could only get 15 permits, I'm going to build very expensive homes," said Basu, noting that young people have resorted to taking out so-called exotic loans and subprime financing.

It's not all bad news.

The job market is still strong, giving young professionals options, particularly in areas of shortage, including health care, Basu says.

He is seeing it firsthand. His 20-something assistant recently left for another job.

"This is the nature of the game," he said.

Overall compensation is rising as well, but it comes with a large caveat: Gen Y will be burdened with the country's rising debt and costs associated with the Iraq war, Medicare and Social Security.

"They won't let you keep much of it," he says.

But young people are not completely powerless. Basu says they should vote not only on the national level but locally as well. Attend those community association, zoning and county council meetings where decisions about housing are made, he says.

Now, will we heed that advice?

What do you think? Are public policies stacked against 20-somethings, making it hard for you to make it? What can you do about it?

Send your stories, tips and questions to working@baltsun.com. Please include your first name and your city.

On the Job is published Monday at www.baltimoresun.com

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