Can Rhode Island Become a Destination for Millennials?
Saturday, April 13, 2019
The trends have been going in the wrong direction for decades -- young people leaving Rhode Island. Now, a new study says Rhode Island ranks as the 31st best state for millennials — and just across the state line, Massachusetts ranks #1 in the country.
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Rhode Island has suffered stagnant population for the last 50 years, but simultaneously each year the state hosts nearly 90,000 college students. These students -- highly educated --- choose to leave Rhode Island at an alarming rate. The Providence DMA ranks second worst in the United States in retaining recent grads — 70 percent leave the area after graduation.
GET THE LATEST BREAKING NEWS HERE -- SIGN UP FOR GOLOCAL FREE DAILY EBLASTThe students attend Rhode Island colleges and universities ranging from Brown University to the Naval War College in Newport to the Community College of Rhode Island.
Efforts to Reverse the Trends in RI
There are efforts to retain millennials and create a sustainable growth economy.
Commerce RI launched Wavemakers, a financial structure to help recent grads lighten the impact of their college loans.
“Every year, talented graduates are faced with the decision of where to start their careers. The Wavemaker Fellowship provides a financial incentive for graduates pursuing a career or starting a business in Rhode Island in technology, engineering, design and other key sectors, by defraying student loan payments for up to four years,” says Commerce about the program.
In addition, the grassroots Millennial Rhode Island was created to encourage those in the age group to stay and work in Rhode Island and #ChooseRI. “We believe that Rhode Island is the best place to live, to have fun, to work, to start businesses, and to start families in,” writes the organization. One of the group’s co-founders Travis Escobar recently appeared on GoLocal LIVE and discussed the group’s efforts and success over the past five years.
Others like the United Way of RI have developed affinity groups like their Young Leader’s Circle is designed to connect millennials with the community and volunteerism.
Big Impact of Millennials
“Loved by marketers yet vilified by media, millennials are at once the most popular and unpopular generation alive. They’re projected to become the largest in 2019, too, giving them a huge influence on American culture and consumption,” said the studies authors WalletHub.
Millennials are responsible for 21 percent of all consumer discretionary spending in the U.S. and despite their national trillion-dollar purchasing power and higher educational attainment, the demographic group is economically worse off than their parents. On average, millennials, ages 18 to 34, carry about $36,000 in debt, according to a 2018 study by Northwestern Mutual Life.
The Federal Reserve reported in January, "The homeownership rate in the United States fell approximately 4 percentage points in the wake of the financial crisis, from a peak of 69 percent in 2005 to 65 percent in 2014. The decline in homeownership was even more pronounced among young adults. Whereas 45 percent of household heads ages 24 to 32 in 2005 owned their own home, just 36 percent did in 2014—a marked 9 percentage point drop."
The significant portion of the decline can be tracked to student debt. "According to our calculations, the increase in student loan debt between 2005 and 2014 reduced the homeownership rate among young adults by 2 percentage points. The homeownership rate for this group fell 9 percentage points over this period (figure 2), implying that a little over 20 percent of the overall decline in homeownership among the young can be attributed to the rise in student loan debt. This represents over 400,000 young individuals who would have owned a home in 2014 had it not been for the rise in debt."
