October 18, 2013

Millennials still lag in forming their own households

Though the nation is officially four years into economic recovery, a new Pew Research Center analysis of recently released Census data suggests that most Millennials (adults ages 18 to 32) are still not setting out on their own.

As of March 2013, only about one-in-three Millennials (34%) headed up their own household.  This rate is unchanged from March 2012 and even lower than the level observed in the depths of the Great Recession ( in 2009, 35% of 18- to 32-year-olds headed their own households).  The absence of any increase in household formation among Millennials is significant because it contributes to lackluster apartment and housing demand as well as the demand for household furnishings that goes along with independent living.

FT_Millennial_Households

What are Millennials doing if they’re not setting up their own households?

In 2013, 34% of Millennials lived in their parents’ home, a decline from the 35% of 18- to 32-year-olds living at home in 2012.  This marginal decline in living at home is largely a result of the way the Census data source handles young college students.  In the Current Population Survey, unmarried 18- to 24-year-olds living in college dormitories are categorized as if they reside in their parent’s home.  As the Census Bureau reported, college enrollment among 18- to 24-year-olds has declined from its peak in 2011, resulting in fewer Millennials living in college dormitories and being counted as living at home.

Similarly, when we look at older Millennials – those ages 25 to 32 – we also see little change in the share who are living at home. In 2013, 15% of Millennials in this older age segment were living in their parents’ home, the same rate observed in this age group in 2012.

And among 18- to 24-year-olds not enrolled in college, 50% lived with their mom and/or dad in 2013.  Again, this is unchanged from the 50% observed in 2012.

One of the contributing factors influencing household formation among young adults is the vigor of the job market. Millennials with jobs are substantially more likely to establish independent households than Millennials lacking jobs.

In 2013, 40% of employed Millennials were the head of their own households, in comparison to 25% of Millennials who were not employed.  Although job holding among young adults increased from 2012 (64%) to 2013 (65%), it remains below 2009 levels (66%) and far below pre-recession levels. In 2007, before the recession began, 71% of 18- to 32-year-olds were employed.

For more analysis of which Millennials are most likely to live in their parent’s home, see our August report, “A Rising Share of Young Adults Live in Their Parents’ Home.”

Topics: Economic Recession, Family and Relationships, Millennials, National Economy

  1. Photo of Richard Fry

    is a Senior Research Associate at the Pew Research Center’s Hispanic Trends Project.

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5 Comments

  1. sepopham6 months ago

    It’s a struggle for everyone who isn’t in the .001%. I am tired of these “generational” studies. We don’t need to be divided, we are all circling the drain together. Capitalism and the “American Dream” were all based on the assumption that the world was being run by people, ie the people with money and economic power who cared about the fate of humanity. Now, we are all painfully aware that that assumption was false. Aliens and bloodless cyborgs run the planet and it’s every man, woman and child for themselves.
    I have a few relatives in the 1%, they shamelessly own stock in Halliburton and the war machine. Even though much of there good fortune is gained off of the misery of millions of human beings they see nothing wrong with it. It doesn’t matter what your age or when you were born, greed is killing us all, no matter what your age is.

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  2. Martin Screeton9 months ago

    I have four children within these age groups and all on their own but its a struggle for them to keep their heads above water. They have less pay and more expenses and debt then I had in the late 70′s! I truly do not know how they will get ahead with the economic conditions we have today. Two of my daughters actually make less per hour then I did as a 18 year old in 1978! How can anybody honestly say that we don’t need a new minimum wage law with a cost of living component. I see nothing but decline even at full employment.

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  3. Deborah9 months ago

    Unless the Census has changed its methodology, there can be only one “head” in a married couple household, or in a household with two unmarried cohabiting adults. How does this factor into the headship rates shown in the graphic on the right? And if three young adults are living together (sharing a rental) as one household, how does this factor into the data? I think that a higher percentage of young adults are living independently than is shown in the CPS.

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    1. Richard Fry9 months ago

      You are correct. In any household, whether married or two unmarried partners (or whatever), there is only one “head.” So, the graphic on the right reports the headship rate or the share of 18- to 32-year-olds that are heads. The CPS does not underestimate the share of young adults living independently if that share is inferred correctly. Suppose I define young adults “living independently” as young adults not living in their parent’s home. Then, using the 2013 figures, the CPS estimates that 66% of Millennials live independently (1 minus the share residing with mom and/or dad).

      So, why report the headship rate? In your example of the three young adults living together, all are living independently and yet they only count as one household and there is only one head (a headship rate of 1/3). But you can bet that landlords and realtors and Home Depot (plus maybe the cable co.) are interested in whether those 3 young adults live together in one household or whether they have the economic wherewithal to split up and live in 2 households (a headship rate of 2/3) or in 3 households (a headship rate of 1 or 100%).

      In conclusion, the CPS is helpful in understanding how many Millennials are living independently and how many households they are forming.

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  4. Megan K.10 months ago

    I think one of the reasons Millennials aren’t setting up their own households, and you touched on this, is education. A YAYA Connection article says that from 2000-2010 full-time enrollment among college students has increased 45 percent, and 70 percent of Millennials and their families believe having a college degree is more important now than ever. (link: bit.ly/1i23rw9) I know enrollment peaked in 2011, but this can explain why Millennial marriage rates, employment rates, etc. have been so much lower than compared to previous years and compared to their Boomer parents.

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