The recession has been going for more than a year now and more and more adult children are moving back into their parent’s homes. Moving back in saves money on rent in order for families to get back on their feet. A survey taken by the Northwest Area Foundation has found that nearly one-quarter of all households in Minnesota have a family member living with them due to lack of money, according to Minnesota Public Radio on November 9.
Other factors involved in moving back home would be someone to watch young children while parents are working or attending school, saving money on food expenses, and less costs on utility bills. All of these things add up for families who are struggling to find solid ground in a shaky economy that is just now showing signs of recovery and investment.
According to a report in the Associated Press today, one in seven parents now report that their kids have moved back home in a survey conducted by Pew Research Center. About a quarter of those polled revealed they were currently unemployed and twenty percent are full time students.
The impetus of these happenings is clear. The recession of the past year has caused adult children to move back home because of no income. How they have chosen to spend their time with their parents is also clear: if people can’t find work they go back to college to learn new skills.
Also according to the AP, less than half of 16 to 24 year olds (46.1%) are currently employed which is the lowest number ever recorded since the statistic began to be analyzed in 1948. Also, a record 11.5 million Americans are currently attending college.
Shifts to Higher Paying Jobs
Despite the recession, there are still rosy outlooks for some job markets such as government jobs and health care. Many of those jobs require some sort of higher education degree such as nursing or social work. There may be large gaps in the work force as educated baby boomers look to retirement in the next ten years so this trend of more college students looks to be a good thing for the economy.
College graduates will also lead to higher paying jobs for those who are educated. Another effect of this is that younger people who would normally have a job are having their jobs being done by older people. Short term, the economy’s numbers may be a bit skewed by the lack of people getting a job because they are in school.
Effects on larger households will be interesting to analyze. Relationships with people may become closer. Rental markets may be stagnant as people stay at home in extended families and aren’t renting apartments right now. No wonder the economy is having a slower recovery, because many of those who moved back in with parents aren’t moving particularly quickly to find jobs since they have places to stay for now.
When they are absolutely certain they can move back out on their own, they will. One interviewee on the Public Radio piece said her business is picking back up and plans to move out in a few months. If her trend mimics the rest of the country, hopefully we can see better recovery numbers after Christmas and things get back to normal.
In the short term, this may make the economic recovery slower but in the long term it will help to ease our economy from any sudden jolts made by vacuums in the labor force due to retirement of baby boomers. I believe we will see some recovery as more people get jobs in January and when current college students become graduates in May. If the current freshmen stay in school, four years from now will be a big gain for graduates as more people leave the job market from retirement.