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1 in 4 young adults lives with a parent or other older family member, study shows

Remote work leads to slower wage growth for workers, study finds
Remote work leads to slower wage growth for workers, study finds 00:54

One in four young adults lived with their parents or another older family member in 2021, the largest share in more than 50 years, according to a new pew from the Pew Research Center. 

The trend is even higher for people between ages 25 to 34 without college degrees, with almost 1 in 3 living in multigenerational households last year, the study found. 

Such households, which typically involve a young adult living with parents, grandparents or other older relatives, have surged in the last several decades, rising from about 1 in 10 young adults in 1971. Economic stress from student debt and high housing costs, as well as a decline in earnings for young men without a college degree, are contributing to the trend, Pew senior researcher Richard Fry told CBS MoneyWatch. 

"Multigenerational living, in a way, is a safety valve. It's a calm from the financial storm," Fry said. "If they were not in multigenerational families, their poverty rate would be much higher — they would be substantially worse off, in economic terms."

The findings have implications for the economy, since these young adults aren't setting up their own households at the age when people in the past have struck out on their own to buy homes, get married or rent their own apartments. At the same time, the surge in housing costs during the pandemic, as well as the hottest inflation in 40 years, may be making it tougher for young adults to move out. 

"The real estate community has a real large interest in this," Fry noted. The trend "undercuts the demand for housing, for apartments," and for furniture and other purchases that go along with setting up a household, he noted.

Most likely to live at home: Young men

Fry said the only period that likely surpassed the current share of multigenerational households is the Great Depression in the 1930s, when economic distress pushed young adults back into their parents' homes. However, the lack of data collection on such issues at the time makes figures difficult to pinpoint, Fry noted.

"It is the highest level since the 1970s, and it's also probably the highest level since the 1940s," he said.

Interestingly, 59% of young adults currently living with their parents or grandparents are men, Fry said.

"What do we know about the labor market outcomes of less educated men over the last 50 years? That is the one group, when we adjust for inflation and look at the typical earnings for young men without a bachelor's degree, their earnings have been falling over the last 50 years," Fry said. Those men are "probably having real difficulty being able to live independently."

He added, "That's not true with young men with a bachelor's degree."

Young women are less likely to be living at home partly because their earnings have been rising over the last five decades, whether or not they have college degrees, Fry noted. 

There's another reason why multigenerational households may be on the rise, added Fry. That's the growing share of Hispanic and Asian families within the U.S., where it's a cultural norm for young adults to continue living with their parents or older family members. 

The pandemic has also pushed some young adults back home, although the research underscores that the overall trend has been rising for at least 50 years, Fry pointed out. 

"Multigenerational living is particularly prevalent among what I would call disadvantaged young adults, or less educated young adults," he said. "They would be in much more dire economic straights if they didn't live with their parents or grandparents."

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