Laura Bliss is CityLab’s west coast bureau chief. She also authors MapLab, a biweekly newsletter about maps (subscribe here). Her work has appeared in the New York Times, The Atlantic, Los Angeles magazine, and beyond.
A new report presents puzzling data on the generation hit hardest by the recession.
Unemployment may be dropping, and full-time jobs are on the up, but one concerning economic indicator remains firmly in place: Millennials are still living in their parents’ homes.
According to a new report from Pew Research Center, 18- to 34-year olds are less likely today to be living independently (i.e., owning their own homes or living in a place owned by someone other than a parent) than they were in the darkest days of the Great Recession.
At the beginning of 2015, 67 percent of Millennials were living apart from their families, down from 69 percent in 2010 and 71 percent in 2007. Most of the drop can be explained by young people moving in with their families.
This is in spite of the fact that, since 2010, the national unemployment rate for the same age bracket has declined to 7.7 percent from 12.4 percent, according to the report. Though national unemployment numbers must always be taken with a grain of salt, overall earnings are also up slightly. As of the beginning of 2015, Millennials have been earning a median pay of $574 per week, up their post-recession low of $547 in 2012. From a labor standpoint, this is a substantial, if not quite complete, recovery.
Yet even with better-paying, often full-time jobs in hand, young people who retreated home during the depths of the recession haven’t left, and still more are moving back. Although women (who are often married or romantically involved earlier than men) and college-educated Millennials are more likely to be living apart from their families than others, all groups have experienced a decline in independent living relative to 2010.
Why are Millennials still failing to launch? Richard Fry, a senior researcher at Pew and the author of the new report, says economists are scratching their heads to an extent.
“Is it a good thing or a bad thing? I don’t know,” Fry told Time. “My expectation was that as the labor market improves, more young people will strike out on their own, but that’s not the case.”
One explanation, however, may be found in the effects of local economies, where growth can have countervailing effects on Millennials’ independence. A recent report from the Federal Reserve Bank of New York found that while an improved local job market may support a young person setting off on her own, it also drives up the cost of housing, sending that young person back home. Below, a map included in that report shows the national spread of 25-year-olds living with their parents, emphasizing how state-level economic climates can also influence independence.
Crushing student debt is another significant launchpad barrier for Millennials with degrees. Between 2000 and 2013, the federal report found, young people who relied heavily on loans to fund their education were substantially more likely to move home after living independently, or more likely to never have left, than those who did not.
And Millennials who didn’t need college loans, because they had parents wealthy enough to support them? They’re more likely to be out on their own, saving money, and perhaps even planning to buy their own home. Meanwhile, the rest of their generation is stuck in a holding pattern, the long-term effects of which have yet to fully emerge.