+ Income Inequality Challenges Facing Young Households in the US Chunzi Lin Nick Pawloski Benjamin Rustman Wei Rong Tay Zach Uminski

+ Pew Research Center Founded in 1990 and based in Washington D.C. Provides information on social issues, public opinions, and demographic trends Conducts public polling, research, media content analysis, etc. Mission is to enrich the public dialogue and supports sound decision-making

+ Income Inequality

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+ Young Households Income gap among young households has become bigger Lowest quintile of earners have seen their share of income fall, while highest-earning quintile grown their share of income Decreasing mean income for young adults As young generation grow older, it will widen the income inequality gap Causing social and economic problems So what can be the root causes…?

+ Causes 1)Education College graduates are more likely to earn twice the salary of high school diplomas

+ Causes 1)Education (conti.) The median wage growth of college graduates is higher than non-college graduates This could be due to the supply and demand of labor market

+ Causes 2)Student Loans 69% of graduates had student loan debt Average student loan debt is more than $30,000 Increased by 33% since 2005

+ Causes 2)Student Loans (conti.) College tuition fees has increased dramatically over the last few decades

+ Causes 2)Student Loans (conti.) Average earnings of young college graduates has been decreasing

+ Causes 3) Occupation Young adults with higher degree tend to find higher-paid jobs Increasing starting salaries for high-skilled jobs 4) Consumption & Investment behavior Higher educated individuals have better financial knowledge and act accordingly People with less financial literacy are more likely to be in debt

+ Alternatives Current system is not working Changes must be made Education Student Loans Source: Intrust

+ Annual expenditures per FTE student for elementary and secondary education in selected OECD countries, by gross domestic product (GDP) per capita: 2010 Alternatives

+ Annual expenditures per FTE student for postsecondary education in selected OECD countries, by gross domestic product (GDP) per capita: 2010 Alternatives

+ Alternatives 1)Education Establish committee to grade teacher’s performance Repercussions for low performing teachers Eliminate/Reduce “Common Core” More local control

+ Alternatives 1)Education

+ Alternatives 2)Student Loans 69% of graduating seniors had student loan debt Pell Grants are major source for low income families Increase threshold from $23,000 to $32,000

+ Criteria Public Nature of Problem Problems: 1) Public 2)Governmental 3)Economic Targeted Demographic Low Income (>$30,000)

+ Methods Social Acceptance Political Backing Lobbyist Economic Feasibility Time sensitivity Short and Long Term Goals

+ Recommendations Student Debt Rising costs in education Inability to pay Pell Grant Adjustment 30% of College Costs Income Restriction Change from $23,000 back to $32,000 Increase in Social benefits

+ Recommendations (conti.) Education Gap No Incentive for teachers to perform well. Different levels of teachers in each level creates unstable learning environment Performance-Based Pay Restructured Tenure Teacher Monitoring

+ Implementation Plan Step 1: Find multiple possible solutions & select the best option Pell Grant adjustments Education adjustments Estimated time: 10 weeks Step 2: Propose our income and education bill to the community & collect feedback Specific interviews Estimated time: 6 months

+ Implementation Plan (conti.) Step 3: Analyze community feedback Break data into different demographics *Age, educational background, race, wealth, etc. Estimated time: 8 weeks Step 4: Propose income and education bill to our local representative Hire assistance to draft official bill Estimated time: 4 weeks

+ Implementation Plan (conti.) Step 5: Income and education bill passes into law Hire lobbyist Attract media attention Estimated time: 10 weeks to a year Future Steps: Track performance Is it helping to solve the problem? Does it need updates or revisions?

+ Potential Challenges Gathering community feedback Getting the bill passed

+ Conclusion Income inequality among young households is a newly raised issue in the United States Education, student loans, occupations, consumption behaviors are root causes Our team propose Pell Grant adjustment as a solution Short-term and long-term goals Our team is confident

+ Reference Lists DeNavas-Walt, C., Proctor, B. & Smith, J. (2013). Income, Poverty, and Health Insurance Coverage in the United States: Retrieved April 5, 2015 from NCES. (2013). Digest of Education Statistics: Retrieved April 7, 2015 from NCES. (2014, January 1). Education Expenditures by Country. Retrieved April 7, 2015, from Rotherman, A. (2012, May 24). How To Fix Pell Grants | TIME.com. Retrieved April 6, 2015,from Baum, S. & Steele, P. (2010). Who Borrows Most?Bachelor’s Degree Recipients with High Levels of Student Debt. Retrieved April 1, 2015 from Strauss, V. (2013, December 15). How much teachers get paid — state by state. Retrieved April 7, 2015, from Student Body of America Assosiation. (n.d.). Possible Solutions to the $1 Trillion Student Debt Crisis. Retrieved April 6, 2015, from U.S. Census Bureau. The Statistical Abstract of the United States: Retrieved March 30, 2015 from

+ Question?