In the race to get ahead economically, America's young workers are falling behind.

A new survey shows that median incomes fell for householders under 45, even as they rose for older ones, between 2001 and 2004.

Income fell 8 percent, adjusted for inflation, for those under 35 and 9 percent for those aged 35 to 44. The numbers add new weight to longstanding concerns about whether younger generations of Americans will achieve living standards that are better - or at least equal to - those of their parents.

"It's a scary question," says Carrie Brown, who runs the Blue Frog Bakery in Boston. She says that for now, at least, she's not keeping pace. And if she and her husband have children, she says she's not sure if her children will enjoy the same lifestyle she did while growing up.

Her concern is shared by many Americans who follow the baby-boom generation. One often-voiced worry is about generational fairness in tax burdens, given the prospect of a soaring federal tab in coming decades for Medicare and Social Security as the number of elderly Americans rises.

But today, even long before any such fiscal shock arrives, younger workers are already feeling squeezed by other trends. An increasingly competitive global economy, the rising cost of higher education and healthcare, and changing patterns of family life are among the factors that have combined to make the career environment tougher, economists say.

"There's no guarantee" that US living standards will continue to rise, says Laurence Kotlikoff, a Boston University specialist in generational economics.

For now, the prospect of a generation underperforming their parents may be more of a fear than a reality. By many measures, America continues to grow more prosperous with each passing decade.

A long-term trend of falling interest rates since the 1980s, for example, means that even after the recent runup in home prices, houses are generally more affordable today than they were 20 years ago. And homes today contain gadgets - from a child's video-game system to an adult's pocket e-mail device - that didn't exist a generation ago.

At the same time, however, evidence of economic challenges also abounds.

The signs include:

• Rising debt levels. Over the past decade, the volume of federal student loans tripled, reaching $85 billion in new loans last year, according to a new book by Anya Kamenetz, "Generation Debt." Nearly a quarter of college students are using credit cards to pay some of their tuition costs, she writes.

• The median income for men under age 44 was significantly lower in 1997 than in 1970, after adjusting for inflation, according to a long-term analysis by the Census Bureau in the late 1990s. For those over 45, incomes barely held their own during that period.

Page: 1 | 2