Gen Y and the lesson they had to have ...

I was seven when Australia last entered recession. My depth of understanding of those consecutive quarters in the red is a faint association with the words "we had to have" care of my high school economics teacher (there was something about a banana in there as well). Now, almost a generation on, we appear poised for another. With Australia managing to avoid the worst of the global markets last quiver, the dot.com implosion, members of Generation Y have only ever really known this nation as the group Men at Work fathomed it - the land of plenty.

We have careered through high school, university and for some, into the infancy of full-time employment, knowing only the blue skies of boomtown.

That's not to say we weren’t forewarned with cautionary tales, nor chastised for our perceived ignorance. Grandparents using only checking accounts because of a deep suspicion of ATMs served as a living reminder of austere times. Given the slightest chance Nan would aphorise that just as night follows day, a bust must follow a boom. Meanwhile, employers would lament the schizophrenic attention span of the “me” generation and its disregard for venerable Australian virtues like loyalty and stoicism.

We listened to the tales, but didn't change our ways. How could we? As Aristotle wrote, “one must learn by doing the thing”. All we'd done was grow up in one of the most prosperous countries in one of the most prosperous periods in history. With no experience to the contrary, we showed consistency by sustaining our flippant ways in the workplace and continued to build our tolerance of debt by assuming more of it.

For some (our Generation X predecessors in particular), through their own dark clouds of the downturn there shine rays of schadenfreude and the hope that a recession will provide Gen Y with a schooling in the lost art of deference. This was certainly the sentiment of author John Birmingham, quoted in the Sydney Morning Herald saying that he can't wait to see Generation Y "get run over by the coming recession".

While the shrinking job market will turn the hitherto spectre of unemployment into reality for some, sadly for Birmingham, it might not be the steamrolling he so earnestly awaits.

In 1991, Generation X was in a similar place to where Generation Y will be if Australia enters recession this year. At the time of the last recession, that saw unemployment soar to 10.7 per cent, many Generation Xers were leaving school and university. They found their graduate opportunities drying up, in particular the lucrative world of high finance made so palatable by the corporate raiders of the 80s. This year, graduate jobs will be scarcer and the financial sector will prove particularly difficult as the list of banks-made-pariahs mounts. In fact, some banks and firms have already offered signed graduates two-figure payments to take a holiday in 2009 before commencing work in 2010.

But for each parallel between then and now, there are as many differences. In 1991 the White House was two years away from creating an internet site. In 2009, the internet is an inescapable part of everyday life. By virtue of growing up with a computer and therefore being the first class of internet-literate graduates, Gen Y are uniquely placed and have a comparative advantage that Gen X never enjoyed. Moreover, we enter adulthood and our working lives with a sound understanding of the world and Australia's place within it, a product of both international travel becoming a rite of passage and geographical distance being truncated by technological advances. And don't let scaremongering about declining education standards fool you: Generation Y are the most educated in history.

While this affords us some protection, it by no means makes us immune. The assumption of wealth will be shaken and already we have realised (no longer in the abstract), that stock and property prices do not progress along an infinite heavenly ascent. For many studying at university and plotting their ten-year path, working overseas was less a case of if as it was of when. With the turmoil engulfing London and New York this will return to being a privilege as opposed to an expectation. It will also put paid to our shifting through jobs and careers at a rate that would make Malcolm Turnbull blush.

Although sure to cause an adjustment shock, our flightiness is not without hidden benefits in a downturn. As an aversion to settling down characterises not just our approach to work but also life, as a generation we are neither asset laden, nor responsible for feeding multiple mouths. Despite our voracious appetite for spending, a shrinking disposable income that translates in to reining in spending is certainly preferable to defaulting on a mortgage.

Being without these financial commitments also means that for the many who hold their jobs, there will be opportunities to capitalise on low interest rates and perhaps finally be able to afford real estate. As humbling an experience a recession may be for Gen Y, if the lessons are learnt and we mature as a result, we could be nicely poised upon a financial springboard when the economy recovers from its free fall (whenever that may be).

And while Birmingham and his peers are heating the popcorn in preparation for watching the impending Gen Y car crash, they should perhaps look closer to home. For not only are many Gen Xers particularly vulnerable to the slashing of middle management jobs, they have also assumed the very financial obligations our caprice has avoided.