The recession and recovery effected young adults and their headship rate more than that of older adults. Many young people struggled in the recession and as a result moved in with their parents.
As our economy continues to improve and add jobs, younger Americans—millennials—are slowly starting to move out of their parents' homes where a record number of them have been living for the past few years. The global financial crisis that resulted in the 2007–2009 recession forced many unemployed or financially struggling millennials (those currently aged 18 to 34) to move back home or continue to stay living with their parents.
This trend has been one of the forces holding back the US housing market.
Establishing an independent household has long been considered an important milestone in the transition to adulthood. Over the last few years, fewer young adults were establishing their own households. The share of men and women ages 18 to 34 living in their parents’ homes was larger in 2012 than in the early 2000s.
However just in the past few months, that trend has been reversing and America's young people are finally moving out! According to data from Goldman Sachs, the percentage of 18-to-34-year-olds living with parents is now at its lowest level since 2011.
"The improvement in the labor market is likely to push up the headship rates of younger people," writes Goldman Sachs' Jan Hatzius. "Econometrically, we have found some evidence that headship rates respond to labor market changes in the under-35 population." According to the National Association...