The Success Sequence: Why Education, a Job, Marriage, Then Kids Is the Working Order

Ah, millennials. In some ways, they’re very traditional, suggesting that women should stay at home to raise their kids. In other ways, they are very Bohemian, doing as they please when the mood hits. But it turns out, the old-fashioned “success sequence” — a (high school or higher) degree, job, marriage, then children, in that order — is still the winning combination for securing financial well-being, even for this late-day-and-age group.

The term “success sequence” isn’t new. It was coined in the last decade by researchers looking for policy ideas that could help break the cycle of poverty. Of course, it was criticized for pointing out that the cycle of poverty is more likely to be perpetuated for kids born into poorly educated households without two parents and few economic opportunities. It has become rude to point this out even though that’s the problem the research is trying to solve.

But facts are facts, as it were, and a new study by W. Bradford Wilcox, a professor of sociology at the University of Virginia, and Wendy Wang, of the Institute for Family Studies, found that the success sequence holds up as a guidepost for today’s Millennials as it did for Baby Boomers, even after adjusting for a wide range of variables like childhood family income and education, employment status, race/ethnicity, sex, and respondents’ scores on the Armed Forces Qualifying Test (AFQT), which measures intelligence and knowledge of a range of subjects.

The study found that “diverging paths into adulthood” taken by 28- to 34-year-olds — the eldest of the Millennial age group — produce very different economic outcomes.

Among the findings:

  • Millennials who follow the “success sequence” almost always avoid poverty, with 97 percent of Millennials who married first not being poor by age 28, compared to 72 percent who had children first.
  • 71 percent of Millennials from lower-income families who put marriage before children made it into the middle class or higher when they reached adulthood. Conversely, 41 percent of Millennials from lower-income families who put children first made it into the middle class or higher when they became adults.
  • Among black young adults, those who married before having children are almost twice as likely to be in the middle- or upper-income groups (76 percent) than those who had a baby first (39 percent).

success sequence statistics

Since 55 percent of 28- to 34-year-old millennial parents had their first child before marriage, the economic and family impacts will be felt for decades.

Millennials are more likely than previous generations to delay marriage and parenthood, but that doesn’t mean that they have to forego the order of education, work, and marriage. Indeed, there’s a reason the success sequence works.

Why might these three factors be so important for young adults today? Education confers knowledge, skills, access to social networks, and credentials that give today’s young adults a leg up in the labor force. Sustained full-time employment provides not only a basic floor for household income but, in many cases, opportunities for promotions that further boost income. Stable marriage seems to foster economies of scale, income pooling, and greater work effort from men, and to protect adults from the costs of multiple partner fertility and family instability.

Moreover, the sequencing of these factors is important insofar as young men and women are more likely to earn a decent income if they have at least acquired a high school education, and young marrieds are more likely to stay together if they have a modicum of education and a steady income. So, it’s not just that education, work, and marriage independently seem to matter, but the sequencing of education, work, and marriage may also increase the odds of financial success for today’s young adults.

Wilcox and Wang point out that there’s no statistical model to perfectly predict a youth’s future success. Some who succeeded came from roots missing those steps. Others who lived in households that followed the sequence ended up in the bottom third of the income scale. Lastly, there’s no conclusive evidence that the “sequence plays a causal or primary role in driving young adult success.”

The researchers also note that it’s easier to follow the success sequence when one is born into it, as opposed to young adults who came from poor neighborhoods, bad schools, and less educated households. It’s also easier to follow the success sequence when one comes from a cultural background that adopts these ideals and expectations rather than those groups who hold these values in lower regard.

But there’s no mistaking that the numbers overwhelmingly favor those who do follow the course, and that’s where both one’s personal “agency” and public policy come into play.

This report suggests that young adults from a range of backgrounds who followed the success sequence are markedly more likely to steer clear of poverty and realize the American Dream than young adults who did not follow the same steps.

Given the value of the success sequence, and the structural and cultural obstacles to realizing it faced by some young adults, policymakers, educators, civic leaders, and business leaders should take steps to make each component of the sequence more accessible. Any initiatives should be particularly targeted at younger adults from less advantaged backgrounds, who tend to have access to fewer of the structural and cultural resources that make the sequence readily attainable and appealing. The following three ideas are worth considering in any effort to strengthen the role that the success sequence plays in the lives of American young adults.

Read the full report here.

The Persistent Marriage Penalty and Its Impact on Family Formation

You thought this was resolved in the ’90s, didn’t you? It wasn’t.

“Almost one-third of Americans aged 18 to 60 report that they personally know someone who has not married for fear of losing means-tested benefits.”

That’s right, the marriage penalty still exists on families who receive government subsidies, and it is impacting more families as the safety net expands.

Now, the bias up the social ladder has traditionally been to assume that people who have kids without getting married are of questionable moral character because who would go have a baby without having a stable household, right? After all, studies show that children raised by their biological parents in married households have a likelier chance of success in school, a stable job, and upward mobility.

That notion of planning your marriage, then your family is outdated in a lot of communities, not least because when is it ever a good time to have a kid? So maybe the decision to not marry is not a question of moral repute, but in fact a question of public policy working against a loving family whose only commitment phobia is filling out the paperwork.

At least 43 percent of families with children 18 and under receive some kind of means-tested aid from the federal government, from Medicaid to Supplemental Nutrition Assistance Program funds. That number goes up to 47 percent for families with children five and under. And this is what they are likely to face if they marry.

… 82 percent of those in the second and third quintiles of family income ($24,000 to $79,000) face this kind of marriage penalty when it comes to Medicaid, cash welfare, or food stamps. By contrast, only 66 percent of their counterparts in the bottom quintile (less than $24,000) face such a penalty. …

Couples where each partner’s individual income is near the cut-off for means-tested benefits—are about two to four percentage points less likely to be married if they face a marriage penalty in Medicaid eligibility or food stamps. Most of these couples are in the second and third quintiles of family income for families with children two and under ($24,000 to $79,000).

Indeed, this recent report on the marriage penalty notes that couples’ combined income in that second and third quintile of earners ($24,000 to $79,000) could face penalties of lost benefits up to one-third of their income if they were to marry.

A valid question is why has the social safety net grown so large that families making nearly $80,000 are still receiving benefits? That may make sense if you’re talking about a family in Brooklyn or around the Beltway outside Washington, D.C., or  Honolulu, or San Francisco, for example, but that’s certainly not the situation in Indianapolis, Louisville, Omaha, Memphis, Tulsa, and so on.

The answer lies in the decision not to marry. If one unmarried person is reporting income to an agency, then the household earnings don’t get counted as $80,000, it only gets counted as the one family member’s income. A combined income would phase out benefits whereas a reported single income would qualify.

Certainly, no one wants to see anyone in need unable to receive the staples of shelter and food, but as the below infographic demonstrates, 59.7 percent of cities surveyed by Experian (click on it to enlarge) have a lower median income and a lower cost of living than the national average so many recipients can in fact afford to live without federal benefits.

Cost of living in America infogrpahic

The report does not challenge the expansion of the safety net to the lower-middle class, but it does raise the question of whether public policy discourages couples from marrying. And as the evidence shows, a significant minority of Americans say they have seen marriage ruled out because of the policies.

So how does government policy correct itself to not penalize lower-middle-class couples for being married when they start their family? The report makes four suggestions:

– In determining eligibility for Medicaid and food stamps, increase the income threshold for married couples with children under five to twice what it is for a single parent with children under five. Such a move would ensure that couples just starting a family do not feel pressured to forgo marriage just to access medical care and food for their families. The cost of this policy change would be limited, since it would only affect families with young children.

– Offer an annual, refundable tax credit to married couples with children under five that would compensate them for any loss in means-tested benefits associated with marrying, up to $1,000. This would send a clear signal that the government does not wish to devalue marriage and, for couples, it would help to offset any penalties associated with tying the knot.

– Work with states to run local experiments designed to eliminate the marriage penalty associated with means-tested policies. States could receive waivers to test a range of strategies to eliminate penalties in certain communities, and to communicate to the public that the penalties are no longer in force there. Successful experiments could then be scaled up to the national level in future efforts to reform means-tested policies.

– Encourage states and caseworkers working with lower-income families to treat two-parent families in much the same way as they do single-parent families. For instance, states could ease the distinctive work requirements that many have in place for two-parent families receiving cash welfare. Reforms such as this one would put two-parent and single-parent families on a more equal footing when it comes to public assistance. More generally, policymakers and caseworkers should try to eliminate policies and practices that effectively discriminate in favor of single-parent families.

Read the report on the marriage penalty’s impact on lower-middle income families.

Get Out of Dodge? American Migration Slows, Homebodies Abound

Geographic mobility has always played a big part in the “American dream.” For my part, I have moved between states or countries 10 times. But you don’t have to share my apparent wanderlust to realize that picking up and moving can inflect a person’s life for the better. Especially in a hyper-competitive economy, we would intuitively expect people to be moving more and more to seize opportunities and find the best occupational fits.

I recently got curious about this topic and whether reality matched my expectations. I spent an afternoon digging into some migration data from the Census Bureau. And what I found surprised me: People today are actually moving less often than the historical norm.

Much less.

The data are astonishing. In the 1960s, roughly 20 percent of the US population moved in any given year. Since then, that fraction has been cut almost in half. Looking at the numbers another way: While the U.S. population has increased by more than 75 percent since 1960, the total number of people who move annually is roughly the same.

Curiously, those who would seem most compelled to move appear to be especially stuck. Look at Mississippi, which has one of the nation’s highest unemployment rates. One might expect to see outmigration to places such as North Dakota, where unemployment is about half as high. Yet Mississippians today are even less likely to move out of state than they were before the Great Recession.

Why the decline?

Reading through the possible explanations, one popular hypothesis was that our aging population explains a lot of this decline. Younger adults have always moved more relative to older people, and so a population in which they make up a declining share would be expected to be less mobile on average.

This is part of the story, but it doesn’t capture everything that’s going on. For example, it turns out mobility has dropped over time for all ages. In fact, since the onset of the Great Recession, the decline in mobility has actually been the most dramatic among millennials. Other factors must also be contributing. Chief suspects include a more broadly stagnant economy, a housing crisis that left many anchored to homes while they wait for values to rebound, and — especially interesting to me — a regrettable cultural shift that undersells the importance of entrepreneurial living.

Let’s talk solutions. First, we could reform our education system to better equip people with valuable skills that transcend particular organizations and localities. Reviving vocational and technical training programs via creative voucher schemes would be a good start.

Second, we can make moving easier. First and foremost, we should fine-tune welfare programs, many of which have policy quirks that can dissuade the vulnerable from relocating or from seeking employment at all. We could also experiment with small-scale programs in which the government offers relocation allowances or collects information about employment opportunities in other regions, and then rigorously assess their effectiveness.

But more than any policy tweak, we must set out to rebuild a culture that prizes dynamism and treating life as an entrepreneurial project. That starts with leaders who testify proudly to the true pillars of the American dream — courage, adventure, optimism, and a unique refusal to be tied down to our pasts.

When Alexis de Tocqueville came to our shores in the early 1800s, he didn’t find leaders who stoked — and sought to profit from — the masses’ fears of change. In fact, he found quite the opposite, noting that the American people embraced instability and churn as a source of wonder and self-improvement. Today, that sense of adventure is eroding and trepidation is taking its place.

Telling Americans they should be afraid or angry about our changing economy is exactly the wrong answer. The only acceptable response is to fight proudly and boldly for solutions. And I’m convinced that one of those solutions is to help people get out of Dodge.

This section is adapted from my latest New York Times piece.