Young adults are now more likely to live with their parents than in any other living arrangement, according to new analysis of demographic data published by Axios, reflecting trends of the last half decade. And it's not just a college grad thing anymore as even 30-year-old millennials are now more likely to stay at home while still paying off school loan debt and earning the same or less income than boomers.
Axios concludes of what it is to be 30 then and now that, "In the mid-to-late-20th century, the American economy and culture were ripe for 30-year-old men, who — more than European and Japanese — typically landed well-paid careers, bought homes, and supported large families. But since then, getting ahead has become much harder."
So what forces continue to steer people into their parents’ basements?
Naturally, Millennials probably took it for granted that they'd successfully imitate their parents and even surpass them in areas of establishing a financially secure family by their late 20's or early 30's, being debt-free while saving for retirement, and earning higher wages than their parents, but the numbers suggest this isn't happening.
Though now comprising almost a quarter of the population and as the largest demographic currently in the workforce, their median salaries are lower or the same as the prior generation, yet as Axios finds "the financial burdens they carry are heavier, limiting how much their lifestyle can mirror that of their parents."
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Here's what it is to be your parents' thirty vs. being thirty today by the numbers:
Data, via Axios: College attendance, median income, and home ownership from U.S. Census Bureau; cost of tuition from CollegeBoard; median debt from "The Great American Debt Boom, 1948-2013" by Alina Bartscher, Moritz Kuhn, Moritz Schularick and Ulrike I. Steins; marriage figures from a Pew Research Center analysis of the 1960-2000 decennial censuses and 2010 and 2016 American Community Survey (IPUMS). Note: All dollars are inflation-adjusted to 2016. Chart: Harry Stevens/Axios
The data suggests:
A break with prior American rites of passage, including marriage and child-bearing. According to some demographers, this break could slow economic growth.
Men are more likely to earn less. In 1975, only a quarter of 25 to 34-year-old men made less than $30K per year, but that number rose to 41% in 2016.
As a measure of upward mobility, 92% of 30-year-olds in 1970 earned more than their parents at that age, according to a 2016 study led by Raj Chetty, a Stanford economist (h/t Roger Lowenstein). But of those who were 30 in 2014, just half earned more.
- Chetty attributed most of this erosion to slower GDP growth and a change in the distribution of GDP favoring higher earners: GDP would have to rise by 6% a year to get the same impact, he said, and wealth would have to be distributed much more evenly.
- In other words, Chetty suggested, it has become much, much harder for young lower- and middle-income workers to earn as much of the nation's growing wealth as they once did.
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In 2015 Millennials set a 75-year record for highest percentage of young adults living at home with mom:
As Axios explains further, 30-year-olds today are:
Living with their parents: In 1975, when the oldest Boomers were 29, 57% of 18 to 34- year-olds lived with a spouse in their own household. Even as late as 1990, almost half lived with a partner. But in 2016, 31% were living in their parents’ home, making it the new, most common living arrangement for young adults, according to Census data.
Paying more for college: In 1975, college tuition cost $2,450 for public, four-year colleges (in 2017 dollars). In 2017, it was almost $10,000, according to the CollegeBoard.
In more debt: In 1989, less than 20% of families had student debt, compared with 41% in 2013, according to the Census. The amount owed almost tripled in that time.
Less likely to be homeowners: 57% of 30 to 34-year-olds were homeowners in 1982, compared with just 45% in 2017.
But many young Americans are still opting not to own, but rather rent, which is a factor...
And other drivers of the trend are as follows:
- The impact of significant student debt can be seen in lower marriage rates, according to Dora Gicheva, an economist at UNC Greensboro.
In 2017, 57% of millennials were never married. In 1985 — when boomers were around the same age — only a third had never been married, Pew Research's Richard Fry told Axios. Even accounting for unmarried living partners does not make up the difference, he said.
Having fewer children: When Boomers were in their 20s, the fertility rate was 2.48, well beyond the replacement level of 2.1. Today, it is just 1.76.
When a recent survey asked why they were having fewer kids, most young adults said “child care is too expensive.”
Generally, Millennials are best represented in the labor force yet are still most likely to live with their parents.
Richard Jackson, president of the Global Aging Institute, told Axios "Millennials are more risk averse than earlier generations at the same age. People 50 or even 25 years ago didn’t wait to be ‘financially well established’ before starting a family. Now it’s considered irresponsible not to."