Answer: The COVID-19 pandemic.
UPDATE: A new post updates this analysis for July 2020
Catherine Rampell tweeted a link to a Zillow analysis showing 2.2 million adults ages 18-25 moving in with their parents or grandparents in March and April. Zillow’s Treh Manhertz estimates these move-homers would cost the rental market the better part of a billion dollars, or 1.4% of total rent if they stay home for a year.
We now have the June Current Population Survey data to work with, so I extended this forward, and did it differently. CPS is the large, monthly survey that the Census Bureau conducts for the Bureau of Labor Statistics each month, principally to track labor market trends. It also includes basic demographics and living arrangement information. Here is what I came up with.*
Among people ages 18-29, there is a large spike of living in the home of a parent or grandparent (of themselves or their spouse), which I’ll call “living at home” for short. This is apparent in a figure that compares 2020 with the previous 5 years (click figures to enlarge):
From February to April, the percentage of young adults living at home jumped from 43% to 48%, and then up to 49% in June. Clearly, this is anomalous. (I ran it back to 2008 just to make sure there were no similar jumps around the time of the last recession; in earlier years the rates were lower and there were no similar spikes.) This is a very large disturbance in the Force of Family Demography.
To get a better sense of the magnitude of this event, I modeled it by age, sex, and race/ethnicity. Here are the estimated share of adults living at home by age and sex. For this I use just June of each year, and compare 2020 with the pooled set of 2017-2019. This controls for race/ethnicity.
The biggest increase is among 21-year-old men and 20-year-old women, and women under 22 generally. These may be people coming home from college, losing their jobs or apartments, canceling their weddings, or coming home to help.
I ran the same models but broke out race/ethnicity instead (for just White, Black, and Latino, as the samples get small).
This shows that the 2020 bounce is greatest for Black young adults (below age 24) and the levels are lowest for Latinos (remember that many Latinos are immigrants whose parents and grandparents don’t live in the US).
To show the total race/ethnic and gender pattern, here are the predicted levels of living at home, controlling for age:
The biggest 2020 bounce is among Black men and women, with Black men having the highest overall levels, 58%, and White women having the lowest at 44%.
In conclusion, millions of young adults are living with their parents and grandparents who would not be if 2020 were like previous years. The effect is most pronounced among Black young adults. Future research will have to determine which of the many possible disruptions to their lives is driving this event.
For scale, there are 51 million (non-institutionalized) adults ages 18-29 in the country. If 2020 was like the previous three years, I would expect there to be 22.2 million of them living with their parents. Instead there are 25.4 million living at home, an increase of 3.1 million from the expected number (numbers updated for June 2020). That is a lot of rent not being spent, but even with that cost savings I don’t think this is good news.
* The IPUMS codebook, Stata code, spreadsheet, and figures are in an Open Science Framework project under CC0 license here: osf.io/2xrhc.
6 thoughts on “Why there are 3.1 million extra young adults living at home”
So, will these two- and three-generation households be riskier as younger people leave the house for work and bring back coronavirus, or will the reduction in isolation and increased support be a net plus for parents and grandparents? How would we go about finding out?
LikeLiked by 2 people
Good point, Alex. My 29yo Millennial didn’t want to live with us because she wasn’t socially distancing much and afraid she might infect us. But after living a couple months with people who took no precautions, she couldn’t take it anymore. We modified our house with several layers of clear plastic sheeting to separate her room from the air intake for the HVAC. We eat outside on the patio. I love having her. She’s vibrant and curious and smart. We are isolating, and she runs our errands and leaves our packages on a table outside the door. I make her coffee!
LikeLiked by 2 people