A series of recent articles suggest that future earnings for “20-somethings” may be depressed in the future.
That might very well be the case, but economists are historically awful at predicting how future technologies will disrupt old industries and jobs, create entirely new ones as well as change human behavior in some unexpected ways.
Regardless of what happens in a macro-economic sense, I believe 20-somethings will soon be changing their behavior in response to continued technological progress.
For example, did you know that the average automobile sits idle for 22 hours every day. That’s pretty inefficient–especially for a product that costs between $20,000 and $40,000 and requires gas, insurance and–at least in urban areas–can be a hassle to drive and park.
Why then should 20-somethings buy cars in the future? My prediction is that many won’t. Instead they will use their smartphones, GPS technologies, sophisticated algorithms to locate hourly rental cars or, alternatively, utilize their social networks to hitch a ride to where ever they might need to go.
Don’t believe me? In Germany there is a social networking site called mitfahrengelenheit.de (rideshare) that is enabling 30,000 rides everyday. Soon young–and old–people will be doing the same thing in New York, Houston and every other major city in the world.
Why own a car when you can find one whenever you need one?