echoboomerang – number of adult children moving back home – Statistical Data Included
The number of adult children moving back to the nest has been rising since the 1970s, and is likely to swell as the first wave of the 71 million children of Baby Boomers graduates from college. They’ll find jobs, forgo paying rent, and have the kind of spending power marketers can’t ignore.
The leaving home transition has become more renewable, less of a one-way street and more like a circular migration.
After five years of college, Joe Fisher graduated from Northeastern University last June with two goals in mind: to find a job in the entertainment industry, and to move back home with mom and dad. But even after landing a job at Nickelodeon as a production assistant in November, the 23-year-old from New York City continued to live with the folks. “No rent, no money spent on food, the luxury of a washer and dryer in the apartment,” Fisher explains, listing the advantages of home living.
Fisher joins a population of 18 million 20- to 34-year-olds currently living with their parents – 38 percent of all young adult singles. In 1970, 9 percent of men and 7 percent of women ages 25 to 34 lived at home; by 1998, those figures had risen to 15 percent and 8 percent respectively. This rise in the homeward bound marks not only the transition of some 71 million children of Baby Boomers to adulthood, but a fundamental shift in how parents and adult children view their roles. And for marketers, it signals the emergence of a new and untapped market. The new generation of post-collegiate nesters, unencumbered by room-and-board payments, is financially savvy, ready to spend, and a growing consumer force.
“This is exactly the group of college graduates companies want to be talking to,” explains David Morrison, president and founder of Twentysomething Inc., a Radnor, Pennsylvania-based young adult consulting and research firm. “All the money that is normally spent on survival suddenly transfers into discretionary income and that translates into large screen TV sets, the latest consumer electronics, and brand-new sports cars. If you think about what this market aspires to buying, the people most able to afford it are the college students who move back home.”
The boomeranger buying binge has only just begun. Born between the years 1977 through 1994, the first of the Gen Ys – or Echo Boomers, as they are sometimes called – have only recently started trading their caps and gowns for work clothes. This year, some 670,000 or 56 percent of current college students plan to live with their parents for some period of time after they graduate: 19 percent for more than a year, according to a March 2001 poll by JobTrak.com, a job listing and resume database. In The Changing Transition to Adulthood: Leaving and Returning Home, Brown University Professor of Sociology Frances Goldscheider notes, “[Returning to the nest] has gone from a relatively rare event to one experienced by nearly half of all those leaving home. Not only can young adults return home, it has increasingly become normative to do so.”
What’s prompting the turnaround? A fundamental shift in perspective between Gen X and their families and those of Gen Y and their Boomer parents. Back in the recession economy of the early 1990s, basement-bound Gen Xers gaped hopelessly at an unfriendly job market, and considered their collegiate credentials useless at best. For the Silent Generation parents of Gen X, born in the wake of the Depression and World War II, a college education was considered a privilege, and ensuring that their children could attend college was essential. So when Gen Xers shuffled home with their “worthless” diplomas, parents reacted with a combination of resentment, worry, frustration, and despair. Tuition seemed like a waste, their kid couldn’t get a job, or worse, college had transformed their prospective doctor/lawyer/CEO offspring into a member of the dreaded slacker set. Having an adult child in the house was not considered a happy arrangement. By 1994, books like I’m Still Your Mother: How to Get Along With Your Grown-Up Children For the Rest of Your Life and Boomerang Kids counseled parents about sticky issues like charging children rent, the move toward eventual eviction, and negotiating who takes out the garbage.
Today’s Boomer parents also have high expectations, but they are different expectations and are enforced in less rigid ways. Unlike their folks before them, today’s moms and dads see little problem in letting grown-up kids take up temporary, extended, or periodic residence in their homes. According to Amanda Freeman, director of research and trends at Youth Intelligence, a New York-based market research and consulting firm, “Parents have smartened up. Whereas the parents of Gen Xers weren’t very encouraging, Baby Boomers are much more protective. They want to guide their children, not just point out problems, but also help them find solutions. They want their children to pursue their passion, not simply track down the highest paying job possible.”
Meanwhile, Gen Ys like Joe Fisher are becoming more comfortable with this new, and somewhat circular, transition to adulthood. Compared with Gen X, who viewed moving back to the parents’ basement as a clear sign of failure, Gen Ys regard shacking up with mom and dad as economically astute. While pragmatic and positive, they face a huge range of options in today’s multiple-choice world: vocational, associates, bachelor’s, master’s, medical school, law school, business school, full-time, part-time, flex-time, temping. Many grads find having the security of a parent’s home a welcome refuge. According to Alexandra Robbins, co-author of Quarterlife Crisis: The Unique Challenges of Life in Your Twenties, “Particularly after losing the structure of academic life, coming home recreates the boundaries that help twentysomethings feel sheltered and anchored. It’s a product of the Internet age – there’s just so much more uncertainty now.”
Shifts in higher education and marital trends have also contributed to Gen Y’s flight back to the nest. College attendance has not only become much more popular, it has also become a less rigid proposition. Rising tuition costs and the growth of nonresidential colleges have made it more attractive for students to attend local colleges part-time, or take a break after college to save resources before professional or graduate school. Students often take five years to complete their baccalaureate degree (according to the National Center for Education Statistics only 57 percent of students entering four-year institutions complete a baccalaureate degree within five years). The growth of online education will further complicate this picture, making the four-year residential college-to-independent living pattern even more of a rarity.
The paths students’ lives take after graduation are shifting as well. Fewer women return from college bearing an “MRS” degree, and fewer high school graduates leave the family nest to set up house. In 1960, women married at an average age of 20.1. Today, they marry at around 25, while men wed at 27. Living arrangements are no longer as easily categorized. Instead, both men and women spend much of their 20s in a rotating assortment of living situations.
Traditional career paths have changed dramatically, with the first job losing its pivotal role as the determinant of one’s entire career. Gen Ys have quickly adapted to a workplace in which people change jobs more readily and much more frequently. In a January 2000 JobTrak.com poll, only 22 percent of college students thought they’d stay with their first job for longer than three years. Twenty-seven percent expected to leave their first job after only one year.
With so much flexibility and uncertainty infused into the college and career frameworks, even the definition of adulthood is changing. A “grown-up” has traditionally been defined by such diverse occurrences as the onset of puberty, religious ritual, high school or college graduation, entry into the workforce, military service, or marriage. Today, none of these is considered a firm indicator of adulthood. Nor are many twentysomethings impelled to rush down the job-marriage-house-2.2 babies timeline. They tend to rely on less exacting, more individualistic models.
Whereas Gen X often felt stymied by these shifting definitions, Gen Y sees the changing requirements of adulthood as an opportunity. Because major life decisions are delayed and jumbled into entirely new patterns, Gen Ys don’t feel like they’re falling off the map every time they veer away from the traditional path. Instead, today’s college grads view their lives as necessarily oblique, with no right or wrong course. As Frances Goldscheider puts it, “The leaving home transition has become more renewable, less of a one-way street and more like a circular migration.”
While Gen Ys are more flexible in the short-term, they’re also more money-conscious of the long-term. Rather than count on Social Security or pension plans to provide for them, they actively manage their own financial future from an early age. “College students today are fairly conservative when it comes to finances,” observes Ken Ramberg, president of JobTrak.com. “They feel they need to take their financial futures into their own hands and start saving now. For this generation, moving home is a sign of responsibility, not irresponsibility.”
It’s precisely these kinds of attributes that make Gen Ys a good marketing opportunity. Today’s homeward-bound college grads hope to pay back student loans, sock away savings, possibly invest their entry-level earnings, and even begin to make long-term investments. Gina Doynow, vice president and college business manager at Citibank notes, “Far from the myth of college grads being unable to manage their finances, all of our studies and data indicate that in recent years they’ve been among our best customers as managers of credit and personal finance.” And future planning is easier to do without worrying about food and board. “Because they’re so future-minded,” says Freeman, “they are willing to make sacrifices in the present, like living at home.”
Moreover, this generation is confident of its earning power. Gen Y live-at-homers are expected to have relatively more disposable income – to spend on everything from wireless devices to cars to stock market portfolios – than their studio-dwelling counterparts. Indeed, in a March 2000 Jobtrak.com poll, 66 percent of 2000 college students polled believed that they would be more successful than their parents; only 13 percent feared they wouldn’t match up. Even in a waning economy, today’s college seniors are sanguine about their careers. In the poll, 73 percent were certain they’d get at least one job offer, and 30 percent predicted four or more offers from which to choose.
Which means marketers should start paying more attention. Twentysomething’s Morrison thinks that Gen Y’s pragmatic and goal-oriented attitude, combined with their income boost from living at home, makes ignoring this group a mistake. “A lot of marketers’ own assumptions lead them to overlook this market because they still see a stigma to moving back home.” He adds, “This is a big trend and it’s just waiting to be capitalized on.” Morrison suggests that given Gen Y’s optimism and long-term approach, marketers focus on their aspirational needs – giving them products and services that enable them to get where they want to go.
Is the back-to-the nest trend here to stay? Living at home may be transitional, but the tendency to do so looks permanent and may become even more pervasive. The fact that the rate remained steady through an era of unprecedented prosperity means that while economic opportunity isn’t a deterrent to returning home, stagnation or recession may prove an added impetus. With the stigma of living chez mom and dad stamped out, college graduates will be increasingly happy to do so – and ready to reap the rewards.
COPYRIGHT 2001 Copyright by Media Central Inc., A PRIMEDIA Company. All rights reserved.
COPYRIGHT 2003 Gale Group
