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File photo shows graduates lined up to receive diplomas at Berkshire Community College in Lenox, Mass., on June 1, 2018.The Canadian Press

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Someone should hang an Out of Order sign on the escalator of economic prosperity for young adults.

Soaring postsecondary tuitions, stunningly weak income growth and unaffordable housing have combined to rob those in their 20s and 30s of something we take for granted – rising prosperity. The pandemic only makes it worse.

Back in 2012, I took a look at how economic conditions for twentysomethings and thirtysomethings were worse than when I graduated from university in the mid-1980s. A reader dug that column out recently and asked on Twitter if I would take a fresh look.

The pandemic has provided an ideal news hook for revisiting that column. Surveys on financial stress have shown that Gen Z (born roughly between 1995 and 2005) and millennials (born between 1980 and 1994) top the charts. It’s not surprising because the service sector, where a lot of young adults work, was hit hard in the economic closings used to fight the pandemic.

Incomes are where we see the most dramatic example of how young adults were falling behind even before the pandemic. The median employment income for people between the ages of 25 and 34 was $37,400 back in 1984, the year I graduated. Median incomes grew to $37,500 by 2012 and to $39,100 by 2018 (all numbers are in 2018 dollars, which means they are adjusted for inflation).

The income growth acceleration from 2012 to 2018, if that’s the word, amounts to 0.7 per cent a year. That’s an after-inflation number, so it does mean something. At least until we bring house prices into the analysis.

Back in mid-1984, the average national resale house price was $76,351, or two times the median income for 25- to 34-year-olds. The housing boom was well under way in 2012 – you can see this in the fact that house prices had risen to a national average of $363,927, or close to 10 times income. The mid-2020 national average house price of $538,831 would undoubtedly result in a still higher ratio of income to house price.

There’s more to these numbers than young adults being priced out of the market in expensive cities. Those who do buy in are being financially hogtied by the cost of their mortgages combined with life’s other expenses. Only in 30 or 40 years will we know whether they managed to save enough for retirement. Only in 10 to 20 years will we know whether they saved enough to help ease the debt burden on their children as they start college or university.

Tuitions are yet another area where today’s young adults have it worse than when I was a grad in the mid-80s. I recall paying a bit less than $1,000 a year in tuition for my undergrad degree in political science at York University, an amount that was easily earnable in a summer job.

Statistics Canada says the average undergrad tuition for the 2019-20 year was $6,463, which compares with $5,366 in 2012. If tuitions had increased merely at the inflation rate from 1984 onward, then the average in cost would have been $2,208 in 2012 and $2,269 in the past year.

One of the advantages that young adults had in 2012 compared with 1984 was far lower interest rates on mortgages and loans, and this trend continues. As a result of the pandemic, borrowing costs are below what they were in 2012.’s historical mortgage rate database shows a discounted five-year fixed rate of 2.99 per cent in mid-2012, which was considered a great rate. Today, these same mortgages can be had in the 2.09-per-cent range.

Low rates such as these reflect the sad shape of the economy after a long lockdown to limit the spread of COVID-19. The cost of borrowing money to buy a house is as low as we’ve ever seen, yet young adults have never been in a worse position to capitalize.

Our new Globe and Mail personal finance podcast for Gen Z and millennials – it’s called Stress Test – is full of examples of young adults struggling for financial stability both before and during the pandemic. We need all hands on deck to get the economy moving again, postpandemic. Restarting the escalator of economic prosperity for young adults should be part of that.

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