Over half of Gen Z and millennials are living paycheck to paycheck — and college is one of the first things they're cutting from their budgets

A new Deloitte report found that the cost of living is a key reason millennials and Gen Z are choosing to forego higher education.

• A new Deloitte survey found that a third of Gen Z and millennials chose to skip higher education.
• The key reasons come down to cost and preference for careers that don't require degrees.
• It comes as over half of Gen Z and millennials are living paycheck to paycheck, per the report.

Younger workers are foregoing higher education as costs continue to remain top of mind — and the value of a college education isn't what it used to be.

On Wednesday, Deloitte released a survey on Gen Z and millennial attitudes toward the world and their financial conditions. Using responses from 14,468 Gen Z and 8,373 millennials across 44 countries, the survey found that a third of Gen Z and millennials chose to forego higher education, with the primary reasons being financial barriers, family or personal circumstances, and seeking careers that don't require college degrees.

"Cost of living is their top societal concern. The financial constraints of higher education are the number one reason that Gen Zs and millennials are not pursuing it," Deloitte Global Chief People & Purpose Officer Elizabeth Faber told BI.

That comes as over half of Gen Z and millennials are living paycheck to paycheck, per the report — a continued trend among younger workers. For both Gen Z and millennials, the cost of living is their top concern, with Gen Z also concerned about potential unemployment. About a third of both generations reported that they don't feel financially secure. At the same time, many might be seeking out careers that bring stability and don't necessarily require a degree.

"They are looking for roles that are making them less prone for disruption, less vulnerable to automation," Faber said.

It's a trend that's been gaining more prominence over the past few years. As student debt loads remain high and more jobs become available that do not require degrees, more Gen Z are deciding that college just isn't worth it.

For example, a July survey from Business Insider, in partnership with YouGov, found that just 39% of Gen Z said advancing their education was important to them, and 46% of them did not think going to college was worth the cost.

One 22-year-old previously told BI that she decided to drop out of college after just a few months because she saw that the business courses she was paying for were topics she could teach herself, and she hasn't looked back since.

"It has been amazing for me to not be in debt," she said. "I have no student loans, like so many of my friends are in $100,000 in debt and student loans just to get a job that pays $60,000 a year."

Still, younger adults' perceptions toward higher education seem to skew away from overall attitudes toward a postsecondary degree or credential. A new report from Gallup and the Lumina Foundation on the state of higher education in 2024 found that "adults' interest in pursuing some form of higher education is at the highest level" the organizations have ever recorded.

Per the report, which used a sample of over 14,000 adults who are either enrolled in a postsecondary program, were previously enrolled but had not completed a degree, or have never enrolled in a program, nearly all adults without a college degree say that having at least one type of credential is "extremely" or "very" valuable. Of course, cost remains one of the main barriers to obtaining that degree, the report said.

Still, higher education can be important for workers — both in their careers and the opportunity to learn. Deloitte found, per Faber, that the types of jobs held by respondents with higher levels of education tend to provide longer-term job security; those respondents are also less likely to have secondary sources of income. Women are also more likely than men to cite financial constraints as a reason for not pursuing higher education, even though they're less likely to lack interest in getting one, per Faber. That potentially points to continued inequities, especially as workers with higher education feel more confident they'll be able to retire comfortably.

And a higher education might have its own trickle-down effect on daily work life.

"Those with higher levels of education do feel like they have more purpose and impact within their organization," Faber said. "They can drive more change and they have had more agency in choosing to reject assignments or employers that are not aligned with their personal beliefs."

Are you a Gen Zer or millennial opting out of college? Contact these reporters at asheffey@businessinsider.com and jkaplan@businessinsider.com.