Thursday, March 15, 2012

Why Don't Young Adults Move?

Recently, the New York Times published a controversial op-ed piece that took young adults to task because they do not move as frequently as they once did. "Young Americans have become risk-averse and sedentary," the authors say, dubbing them the "Go-Nowhere Generation."

It's true, young adults are moving less. Until recently, about 30 percent of people in their twenties moved each year. By 2010-11, the figure had fallen to 24 percent.

The op-ed blames the usual suspects: the Internet and Facebook, as well as a pinch of laziness and a dash of complacency. But there is a much simpler explanation for the decline in the mobility of young adults: it's the economy, stupid! In particular, unemployment and student loan debt. Never before have the nation's young adults had to confront this one-two punch. On the one hand, it is difficult for them to find a job and even harder to get a job that pays a living wage. The unemployment rate of 20-to-29-year-olds was a double-digit 12 percent in 2011, according to the Bureau of Labor Statistics. On the other hand, many have student loans, preventing them from hitting the road, taking risks, starting anew. Among the 241 million Americans with an Equifax credit report as of the third quarter of 2011, fully 40 percent of those under age 30 had student debt, according to a Federal Reserve Bank of New York analysis.

No wonder a new Pew Research Center study found so many young adults living in multigenerational households. Among 25-to-34-year-olds, more than one in five (22 percent) are living with their parents or grandparents, says Pew, up from 11 percent in 1980. Among those who live with their parents, the 53 percent majority say their finances are tied up with their parents' finances.

The burden of student debt is a ball and chain on young adult aspirations. Debt--not the Internet--is preventing millions of young adults from establishing their own household, moving to a better city, buying a house, even getting married and having children.

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