“Restlessness is discontent and discontent is the first necessity of progress. Show me a thoroughly satisfied man and I will show you a failure.” – Thomas Edison
Young adults are getting restless and are looking for a change. And I don’t mean that metaphorically. The poor economy, stagnant job market and slow-growing wages has literally prevented them from moving out of their home towns. Bloomberg’s Steve Matthews and Victoria Stilwell report:
With the expense of commuting or relocating, “I thought about it and it just didn’t seem right,” said Yang, a biology major who rejected the job 50 miles away in Piscataway to look for opportunities closer to home. “If I was previously living in New Jersey, I think I would have taken that job in a heartbeat.”
Yang belongs to the age group, adults under 35, that’s traditionally the most mobile part of an American work force constantly on the move since the 19th century. Now, that’s changing as members of the millennial generation, the estimated 85 million born from 1981 through 2000, prove less restless than their forebears. The standstill may be holding back recovery in the labor and housing markets.
“They remain stuck in place,” said William Frey, a senior fellow at the Brookings Institution in Washington who specializes in migration issues. “The recent slowdown is really an interaction of demographics and a continued housing- and labor-market freeze. Millennials are mired down, very cautious about buying a home or moving to new areas.”
To be clear, there are very good reasons for Millennial job-seekers to stay at, or close to, home.
With unemployment for 18- to 29-year olds still mired in double digits jobs can be hard to come by. Even those lucky enough to find jobs are more likely than ever to be underemployed in a job they are overqualified for. And even those lucky few who scored a dream gig may not be seeing the wage bumps of previous generations. Average wages have only risen by about 2 percent each year since the “recovery” began in mid-2009, which means they’ve been virtually flat once inflation is factored in.
And even if you’re one of the lucky one to score a good job with decent wages (…congratulations) you’re purchasing power is still likely diminished from increasingly heavy student debt burdens. The latest data from the Federal Reserve Bank of New York shows that overall student debt rose 12 percent since last year to $1.08 trillion. That burgeoning debt coupled with poor job prospects means more young adults are shacking up with mom and dad. Real estate consultant Rick Palacios Jr. writes:
Faced with mounting student loan debt, poor job prospects and stagnant wages, an increasing amount of 25 to 34 year olds (a prized demographic for the housing sector) have moved back in with their parents. Almost 6 million 25 to 34 year olds now live with mom and dad, up 26% from when the recession started in 2007. Today’s 36.8% homeownership rate for 25 to 29 year olds is at its lowest level since 1999, and homeownership for 30 to 34 year olds is at its lowest rate in 17 years.
Unfortunately, young adults’ inability to move could actually make the national economic picture worse because it will create mismatches between jobs and workers. If there is a highly-skilled, well-educated worker who is stuck at home in Iowa because they afford the financial risk of taking a job in some far-off city then the economy grows more slowly.
Young adults are clearly restless. They are clearly discontent with the current state of the economy. And they are definitely not satisfied with the status quo. The question now is how we channel that restlessness into progress.