Generational wealth divide in Europe fuels student unrest

Student demonstrations that started in France in September have expanded to more than 11 European countries. The movement is driven by growing frustration over soaring rents, high fuel prices, and reductions in public services. Many young participants express a sense of disillusionment, stating they no longer believe they will be financially better off than their parents. Recent household wealth data underscores this sentiment by highlighting a stark gap between generations across the continent.

According to the European Central Bank's 2023 Household Finance and Consumption Survey, households led by individuals under 35 have a median net wealth of approximately 25,000 euros. In contrast, households headed by those aged 55 to 64 possess a median net wealth of about 208,000 euros. This represents a disparity of more than eight times, with older households holding significantly greater financial assets than their younger counterparts.

The survey, conducted by the ECB and national central banks since 2010, covers the eurozone as well as the Czech Republic and Hungary. It measures net wealth, which includes property, vehicles, valuables, and savings, minus any debts. In the 22 countries surveyed, under-35s hold only 2.8 percent of total household wealth. Meanwhile, the 55-to-64 age group holds the largest share at 24 percent.

Finland exhibits the most extreme inequality, where under-35s hold just 0.8 percent of household wealth, the lowest share among all surveyed nations. In that country, individuals over 55 hold more than 71 percent of the wealth. Young people also hold small shares in Ireland, Austria, Greece, and Germany, with percentages ranging from 1.4 to 2 percent. This concentration of assets among older generations makes it difficult for younger residents to afford housing that their parents or grandparents could easily access.

In Central and Eastern Europe, wealth is distributed more evenly. In Lithuania, under-35s hold 13.2 percent of household wealth, compared to 15.9 percent for the 55-to-64 age group. Similar patterns appear in Croatia, Slovakia, and Estonia, where younger adults hold between 9.8 and 12.3 percent of total wealth. Malta stands out as an exception outside these regions, with under-35s holding 11.1 percent.

Evelyn Astor of the European Social Observatory noted that housing prices have risen sharply in both rental and ownership markets. She explained that this trend reinforces feelings of inequality, as ordinary families struggle to pay rent or buy homes while wealthy individuals with significant capital can make large investments in the European housing market.

The cost of living has also increased dramatically since the year 2000. Prices for everyday goods and services, including food, energy, transport, and household bills, have risen by 67.2 percent in the eurozone, Hungary, and the Czech Republic. Hungary has experienced the steepest increase, with prices more than tripling according to Eurostat, the EU's statistics agency.

Eastern European countries have seen the sharpest price hikes, particularly since 2022, due to their heavy reliance on Russian energy supplies during the full-scale invasion of Ukraine. Annual inflation in the EU reached 9.2 percent in 2022, driven mainly by energy costs. Although inflation has eased since then, the price rises from the pandemic and the war have not reversed, leaving many households facing higher costs for basic necessities.

These economic pressures have created a backdrop for the current wave of protests. Young Europeans are confronting a reality where wealth accumulation is slower and living costs are higher than in previous decades. The data suggests that without significant changes in housing markets and public services, the generational divide in wealth is likely to persist, keeping tensions high across the region.