Ann Berrington, University of Southampton

Acknowledgements to Juliet Stone, Peter Tammes & Steve Roberts

Young Adults, Economic Precariousness and Housing

The Crisis for Contemporary Youth: Opportunities and Civic Values in Comparative, Longitudinal and Inter-generational Perspective. 4-5th June 2015, London.

Overview

1. Changing socio-economic and policy context

2. With whom do young adults live?

3. What is the impact of economic precariousness on transition out of parental home?

4. Discussion

1. Changing socio-economic and policy context

Increased Economic Precariousness

• Increased enrolment in HE.– Increased student

debt.

• Increased youth unemployment and economic insecurity for those in work.– Part time,

temporary & short hours contracts.

4

– Increased house prices, lack of mortgage credit.– Increased rental prices, deposits.

Source: Shelter (2015)

Declining affordability of private housing

First time buyers now older, middle earners squeezed out

Source: Shelter (2015)

1920 1924

1928 1932

1936 1940

1944 1948

1952 1956

1960 1964

1968 1972

1976 1980

1984 1988

1992 1996

2000 2004

2008 2012

-

50,000

100,000

150,000

200,000

250,000

300,000

350,000

400,000

450,000

New house building in UK each year 1920 to 2013 (Northern Ireland included only from 1948) Total

PrivateSector

Public Sector & Housing Associa-tion

Annual average growth in number of households (source: DCLG Live Table 401)

Sources: From 1946: DCLG live tables. Earlier: Scottish Housing, and AE Holmans 2005

Increased reliance on private rental sector

20-24 25-29 30-34 35-39 40-44 45-49 50-54 55-69 70+0%

10%20%30%40%50%60%70%80%90%

100%

Percentage private renting by age of Household Reference Person UK, 2001 and 2014

2001 2014

Age of household reference person

Source: Labour Force Survey

Welfare retrenchment

– Residualisation of social housing sector– Restrictions in housing benefit/Local

Housing Allowance (LHA) • Shared Accommodation Rate under 35 single

young adults• Reductions in value of LHA• Overall benefit cap, soon to be reduced further

9

2. With whom do young adults live?

% living with a parent, UK, 2001, 2011 and 2014

Source: ONS, from LFS

Female

Male

Household Type by Economic Activity Status. Women aged 25-29, UK 2009/10

econ active econ inactiveunemployed FT student family care0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

sharing with othersliving alonelone parentwith partnerwith parents

% in

eac

h liv

ing

arra

ngem

ent

employed

Source: Understanding Society

Tenure distribution of young women living outside parental home according to age and household type, UK 2012.

With partner

Lone parent

Alone

Sharing

With partner

Lone parent

Alone

Sharing

With partner

Lone parent

Alone

Sharing

20-24 25-29 30-34WOMEN

0%10%20%30%40%50%60%70%80%90%

100%

Owner Occupier Private Rent Social Rent

Source: UK LFS. Berrington & Stone (2014)

Percentage of young adults who are single and living outside the family home in shared accommodation, UK 2012 and 2014

20-21 22-24 25-29 30-34 20-21 22-24 25-29 30-34Women Men

0

5

10

15

20

25

30

20122014

Source: Labour Force Survey

Concealed Families on the Rise Again, Especially in London

Percentage of families that are concealed according to age of head of family unit and family unit type, Eng & Wales, 2011

Source: 2011 Census

Lone

par

ent f

amili

es

Coup

le fa

mili

es

All f

amili

es

Lone

par

ent f

amili

es

Coup

le fa

mili

es

All f

amili

es

24 and under 25-34

0

4

8

12

16

Series1 Series2

3. What is the impact of economic precariousness on chances of leaving parental home?

Measuring economic precariousness

UK 25-29 year-olds, 2009/10 % of total who are

unemployed employed semi-/ routine

employed part-time

employed temporary

Men 13 18 6 7

Women 8 16 26 8

Source: Berrington A. et al. (2014) Economic Precariousness and Young Adults’ Living Arrangements., ESRC Centre for Population Change Working Paper.

Analytical Framework – analyses leaving home

Parental characteristics• Parental household

income• Maternal education• Parental family

structure

Young adult’s characteristics• Economic activity /

precariousness• Highest educational

qualification• Ethnicity• Region residence

Probability of transition out of parental home

Modelling Transition Out of Parental Home

• Analysis of paired waves of Understanding Society (UKHLS) data waves 1-3

• Sample: men and women aged 16-29 living at home at t0• Logistic hazards model of leaving home between t0 and t1• Parental background and individual level explanatory

variables

• I will show findings for employed young men Secure (i.e. permanent full time work) vs Insecure work (i.e. part time or temporary work)

Highest

quartile of H

H inco

me

2nd highest

quartile HH in

come

3rd high

est quarti

le HH inco

me

Lowest

quartile HH in

come

0.00

0.04

0.08

0.12

Permanent full time job Insecure job

Predicted annual probabilities of leaving parental home by job security and parental household income. UK employed males, 16-22, 2009-2013.

Other variables held at reference category: white, higher educated, living in London, high maternal education, living with two natural parents

Two natural parents Two - other parents Lone parent0.00

0.05

0.10

0.15

0.20

0.25

Permanent full time job Insecure job

Predicted annual probabilities of leaving parental home by job security and parental family structure. UK employed males, 16-22, 2009-2013.

Other variables held at reference category: white, higher educated, living in London, high maternal education, highest quartile of HH income

White Indian Pakistani & Bangladeshi

Other and mixed0.00

0.05

0.10

0.15

0.20

0.25

0.30

Full time permanent job Insecure job

Predicted annual probabilities of leaving parental home by job security and ethnicity. UK employed males, 23-29, 2009-2013.

Other variables held at reference category: higher educated, living in London, high maternal education, highest quartile of HH income, living with two natural parents

4. Discussion

Young Adults Priced Out of Owning a Home• Private rented sector dominant role in housing pathways for

older / wider sector of population.• House price to income ratios rapidly increasing from 2001

onwards.• Mortgage interest low but large deposits required (Help to

Buy ~ 100,000 homes).• Inter- and intra-generational inequality in housing

pathways. • Need to increase availability of stable, good quality rented

accommodation for increasing numbers of young families.• Regulation of PRS – new life course phases.• “The Government must build more of the right homes at the

right prices in the right areas”’ David Orr (National Housing Federation)

Transition to Residential Independence

• Are these trends result of short term crisis or part of a longer term change in nature of housing transitions?

• Early home leaving seen both among advantaged young adults (e.g. to attend HE), and among disadvantaged (e.g. more likely to leave to search for a job, family friction).

• Select group who remain in parental home in late twenties and early thirties tends to be socio-economically disadvantaged

• Returning home esp. after HE, partnership dissolution (Stone et al., 2014)

Policy Implications • Lack of ability of some vulnerable groups to return home.• Queen’s Speech => 18-21 yr olds => homelessness• Need supported pathways for early, non-student leavers.• Importance of policy to recognise gender and ethnic

differences in housing pathways.• Implications of changes to level of LHA, e.g. benefit claimants

priced out of London• Slight increase in sharing - At what age should we expect young

people to live in shared housing?• Current housing policy supports main carer of dependent

children but ignores non-resident parent.

References

Berrington, A. and Stone, J. (2014) Young adults’ transitions to residential independence in Britain: The role of social and housing policy. In Hamilton, M., Antonucci, L. & Roberts, S. (Eds.) Young People and Social Policy in Europe. Palgrave Macmillan.Berrington, A. et al. (2014) Economic Precariousness and Young Adults’ Living Arrangements., ESRC Centre for Population Change Working Paper. http://www.cpc.ac.uk/publications/cpc_working_papers.phpShelter (2015) Housing Affordability for First Time Buyers, March 2015.Stone,J.,et al. (2011) Demographic Research, 25(20):629-66. The changing determinants of UK young adults' living arrangements. http://www.demographic-research.org/volumes/vol25/20/25-20.pdfStone, J. et al. (2014) Gender, turning-points and boomerangs: returning home in the UK. Demography, 51, (1), 257-276.

27

Acknowledgements

This research is funded by ESRC Grant numbers RES-625-28-0001 and ES/K003453/1. The Centre for Population Change is a joint initiative between the University of Southampton and a consortium of Scottish Universities in partnership with ONS and NRS. The findings, interpretations, and conclusions expressed in this paper are entirely those of the authors and should not be attributed in any manner to ONS or NRS.

Understanding Society is carried out by the Institute for Social and Economic Research at the University of Essex. The UK Labour Force Survey is carried out by the Office for National Statistics. Access to these data is provided by the UK Data Archive. The original data creators, depositors or copyright holders, the funders of the Data Collections (if different) and the UK Data Archive bear no responsibility for their further analysis or interpretation.

28

• SPARE SLIDES

Unemployment rate 1992-2013 according to graduate status, UK

Q2 1992

Q2 1993

Q21994

Q2 1995

Q2 1996

Q2 1997

Q2 1998

Q2 1999

Q2 2000

Q2 2001

Q2 2002

Q2 2003

Q2 2004

Q2 2005

Q2 2006

Q2 2007

Q2 2008

Q2 2009

Q2 2010

Q2 2011

Q2 2012

Q2 20130

2

4

6

8

10

12

14

16Recent graduates Non recent graduatesNon graduates aged 21-30 Non graduates aged over 30

Une

mpl

oym

ent R

ate

Source: ONS, 2014

Household Type by Economic Activity Status. Men aged 25-29. UK 2009/10

econ ac

tive

econ in

active

unemployed

FT st

udent0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

sharing with othersliving alonelone parentwith partnerwith parents

% in

eac

h liv

ing

arra

ngem

ent

Reported parental family type at age 14, UK men and women aged 16-24 in 2009-10 by ethnic group.

WhiteMixed

BlackIndian

Pakistan

Bangladesh

Other

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Two biological parentsMother and step fatherFather and step motherLone motherLone fatherOther

Ethnic group

Perc

enta

ge (w

eigh

ted)

Large cross-national variations in co-residence among young adults

33

% males aged 25-34 living with a parent in 2012 and 25-29 male unemployment rate in 2012

Dimensions Types Indicators1-Precarious labour market

A-labour insecurity

i-(Un)employed

ii-Occupational class & mobility

B-income insecurity i-Earnings, wages2-Precarious employment relations

A-Employment insecurity

i-Part-time contractii-Temporary contractiii-Other: seasonal, shifts

B-Skill reproduction insecurity

i-Training & development

C-Work insecurity i-Protection against accidents, illness, inferior treatment

3-Precarious social and political relations

A-Representation insecurity i-Trade union representation

ii-Right to strikeB-Social insecurity

i-Social benefits & social policies

ii-Role of partner, parents or other relatives

Table 1: Dimensions and indicators of economic precarity (See CPC Working paper #55 / Briefing paper # 22)

Adapted from Kalleberg (2009), Standing (2011), and Wilson and Ebert (2013).

Employment insecurity: % part-time according to gender, age and occupational class (See BP #22)

Managerial/professional Intermediate/lower supervisory/technical

Semi-routine/routine

Managerial/professional Intermediate/lower supervisory/technical

Semi-routine/routine

Managerial/professional Intermediate/lower supervisory/technical

Semi-routine/routine

Managerial/professional Intermediate/lower supervisory/technical

Semi-routine/routine

18-2

425

-34

18-2

425

-34

men

wom

en

0 10 20 30 40 50 60

Source: UKHLS 2009/10

5. Reported ideal age for leaving home by gender and ethnicity, UK 2011/12.

Ethnicity Males Females

Mean# (se) % non-num.

Mean# (se) % non-num.

White 21.3 (0.1) 12.1 21.1 (0.1) 7.6

Indian 23.1 (0.5) 15.0 22.8 (0.4) 16.9

Pakistani & Bangladeshi

23.5 (0.4) 24.5 23.3 (0.4) 18.1

Black 22.5 (0.4) 12.8 21.5 (0.3) 12.0

Other & mixed 21.5 (0.4) 11.1 21.6 (0.3) 10.1

Source: UKHLS wave 3, 16-21 year olds living at home.

There was already an increase in proportions remaining in parental home prior to recession

37

Employed FT, perm

Other employed

Unemployed Student Inactive0%5%

10%15%20%25%30%35%40%45%

1998 2008

Economic Activity

Perc

enta

ge (w

eigh

ted)

% males aged 25-34 living with parents, 1998 and 2008, by economic activity, UK.

Source: UK LFS. Stone et al. (2011) The changing determinants of UK young adults' living arrangements. Demographic Research 25(20):629-66.

Household Type by Economic Activity Status. Men aged 25-29. UK 2009/10

econ ac

tive

econ in

active

unemployed

FT st

udent0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

sharing with othersliving alonelone parentwith partnerwith parents

% in

eac

h liv

ing

arra

ngem

ent

employed

Source: UKHLS, w 1

Two sets of models for employed men: 1) those aged 16-22 at t02) those aged 23-29 at t0

Model 1 Job insecurityModel 2 Model 1 + respondent’s level of education,

ethnicity, region residenceModel 3 Model 2 + maternal education, parental

household equivalised income, parental family structure

Results for employed men: Odds ratios for leaving home, 2009-2012Aged 16-22 Model 1

Job insecurity

Model 2+ indv. char.

Model 3+ parental char.

Job security (ref. = permanently employed)

1 1 1

Insecure job 0.859 0.902 0.887

Aged 23-29 Model 1Job insecurity

Model 2+ indv. char.

Model 3+ parental char.

Job security (ref. = permanently employed)

1 1 1

Insecure job 0.499*** 0.520** 0.515*

5. Young non resident fathers

Young Non-resident Fathers• UK distinctive in high proportion of children not living with

both natural parents.

• Rules for social housing entitlement & housing benefit assume one parent has primary care of child.

• But shared parenting takes place and is encouraged.

• Non-resident parent will be classed as not having children and hence not qualify for e.g. access to social housing, will be affected by SAR & ‘bedroom tax’.

How many young men are reported to be non-resident with at least one of their children?

Age groupNon-resident fathers

% of all men % of fathers

20-24 3.1% 37.2%

25-29 7.7% 26.3%

30-34 9.5% 19.5%

Total (20-34) 5.4% 24.2%

Reported prevalence of non-resident fathers in the UK by age group, UKHLS, 2009-2010

Source: UK LFS. Berrington & Stone (2014) Young adults’ transitions to residential independence in Britain: The role of social and housing policy. In Hamilton, Antonucci & Roberts (Eds.) Young People and Social Policy in Europe. Palgrave Macmillan.

With whom are young non-resident fathers living?

20-24 25-29 30-340%

20%

40%

60%

80%

100%

With parents With partner Living alone Sharing

Age group

Perc

enta

ge (w

eigh

ted)

Distribution of living arrangements among UK non-resident fathers by age group, 2009-2010. UKHLS.

Source: UK LFS. Berrington & Stone (2014) Young adults’ transitions to residential independence in Britain: The role of social and housing policy. In Hamilton, Antonucci & Roberts (Eds.) Young People and Social Policy in Europe. Palgrave Macmillan.