Young workers born in the late 1990s are making 12 per cent more money at age 24 than people born a decade earlier, according to research from the Resolution Foundation published in June 2026. This is surprising because for years we heard that each generation was earning less than the one before. But a closer look shows the real story is messier than the headlines suggest.

When millennials were the age Gen Z is now, they seemed to be doing okay. But something changed. People born in the late 1980s ended up earning about 8 per cent less at age 30 than people born ten years before them, according to Resolution Foundation research. That gap kept compounding over their whole working life, meaning they saved less for retirement, owned fewer homes, and ended up with less wealth. And it got worse when you counted housing costs. Today's 30-year-olds spend nearly a quarter of what they earn on rent or mortgages—more than any generation before them, according to figures the Resolution Foundation shared with Reuters.

What Happened to Millennials

Millennials often talk about financial stress, and the numbers back them up. When you look at how much money they actually had left after paying for housing, millennials earned no more than Generation X did—even though the country's economy got bigger overall. All the extra money they made went straight to landlords or banks instead of staying in their pockets.

Gen Z might have higher starting pay for a few reasons: businesses desperate to hire workers after the pandemic offered higher wages, the government raised the minimum wage, and more young people now work in jobs like tech or skilled trades where pay is better. But a good first salary is not the same as doing well for your whole life. The real question is whether Gen Z keeps this pay advantage as they get older, or whether housing costs take it away from them like it did from millennials.

There is a problem coming. Money growth was strong in 2024 and 2025, but experts expect it to almost stop in 2026, growing only 0.2 per cent, according to the Resolution Foundation. If that happens, the wage boosts helping young workers now will shrink. Job markets that pump up young workers' pay can reverse just as fast.

Young People Having Fewer Children

Something else is shifting. Fewer 32-year-old millennials have children now compared to the past, according to the Resolution Foundation. This probably connects to the housing and money stress they faced when they were young. The timing lines up: that generation was job-hunting after 2008—a financial crash—and by then, houses cost too much for first-time buyers in most big cities.

One thing that does look like it is genuinely improving: the pay gap between young men and young women has cut in half to about 5 per cent, according to research Reuters reported on. Young women now start work on much more equal footing than their mothers did. The gap still widens later when women have children, which the lower birth rates may partly explain.

So what does this mean? Gen Z's higher pay right now is real and worth noticing. But it is just what happens at the start of their careers. The bigger lesson from studying generations is that wages have always gotten eaten up by housing costs before people hit their 30s or 40s. Unless housing becomes cheaper and more stable for young people, that early pay gain will disappear just like it did before. And with money growth forecast to barely move in 2026, that squeeze could happen sooner rather than later.