Gen Z is working hard, but the economy is putting the American dream out of reach for many

Young people are working. They're just waiting longer for the "American dream" that work was supposed to buy.

Labor force participation among Americans in their prime working years remains near its highest level in decades. Yet younger adults are buying homes later, delaying marriage and putting off having children as housing prices, elevated interest rates and other household expenses continue to outpace wage growth for many households.

The economic backdrop has come under renewed scrutiny after White House press secretary Karoline Leavitt suggested Gen Z's frustrations stem in part from "laziness." 

Once her comments drew backlash, Leavitt said critics had taken her remarks out of context, arguing she was referring to young people embracing socialism and communism — not a blanket statement regarding all of Gen Z. She added that "many Gen Z Americans are hardworking, entrepreneurial, and deeply patriotic."

Generation Z, often shortened to Gen Z, includes Americans born between 1997 and 2012, and is emerging as a growing force in both the labor market and U.S. politics.

Leavitt also claimed the Trump administration's economic agenda — including tax cuts, deregulation and other affordability-focused policies — is intended to strengthen economic conditions for younger Americans.

WE ASKED AMERICANS TO GRADE THE ECONOMY. THEN WE ASKED IF IT WOULD CHANGE THEIR VOTE.

While her remarks sparked debate, economists say today's young people entered adulthood during one of the most challenging economic environments in decades, marked by high inflation, soaring housing costs and a cooling white-collar job market.

The labor market data paint a more nuanced picture. Labor force participation among Americans ages 25 to 54 stood at about 83% in May, hovering near its highest level in decades, according to Bureau of Labor Statistics data. Participation among Americans ages 20 to 24 has also remained above pre-pandemic levels.

"There's lazy people in every generation," Heritage Foundation Chief Economist EJ Antoni told Fox News Digital. "It doesn't matter if you're talking about the boomers, Gen Z or anybody in between."

Richard Stern, vice president of the Plymouth Institute for Free Enterprise at Advancing American Freedom, said the data suggests Gen Z's preference for flexible work should not be confused with a lack of work ethic.

"Labor participation rates for 16- to 19-year-olds, for 20- to 24-year-olds are all high," Stern said. While younger workers may prefer flexible or remote schedules, "that's not a work ethic thing. I think it's actually a preference thing," he added.

A PROBLEM HIDING IN PLAIN SIGHT IS KEEPING AMERICANS FROM BUYING HOMES

Antoni pointed out how "the monthly mortgage payments on a median-priced home literally doubled during Biden's four years in office."

"You don't have to ascribe any pejoratives to young people to realize that that is completely unsustainable."

Housing affordability has deteriorated sharply over the past several years. The average 30-year fixed mortgage rate climbed from roughly 3% in early 2021 to about 6.5% today, while the median U.S. home price rose from roughly $329,000 to more than $400,000, dramatically increasing the cost of buying a home.

Stern said higher borrowing costs have made it dramatically harder for younger Americans to purchase homes and vehicles — two traditional markers of financial independence.

"Interest rates have tripled on things like cars and mortgages," Stern told Fox News Digital. "So for new workers and young families, higher inflation and much higher interest rates have made it tremendously less affordable to buy a home or a car."

Those affordability pressures have delayed more than just homeownership. The median age of a first-time homebuyer reached a record 38 years old in 2025, according to the National Association of Realtors.

Paul Teller, a conservative strategist who previously served in the Trump-Pence White House, said Leavitt's comments surprised many conservatives because they don't reflect what he sees from young workers.

"Folks are working hard," Teller told Fox News Digital. "We're Americans, so this is what we do in our nature. Americans don't have to be told to work hard."

Teller said younger Americans are discovering that the same path to the middle class no longer delivers the same results. "The same education that their older siblings got or their parents got isn't taking them this far," he said. "The same relative wage isn't taking them as far."

The numbers suggest the challenge for many younger Americans isn't participating in the workforce. It's that work no longer buys the same milestones it once did.