From the pandemic onward, young adults have had to cope with significant economic and job market shifts and challenges. This cohort is struggling to secure white-collar jobs after working hard and going into debt pursuing a college degree. A recent survey by Intelligent, an online magazine dedicated to student life, revealed that 38% of employers avoid hiring recent college graduates in favor of older workers.
Due to financial challenges, resulting from the lack of employment opportunities and the high cost of living, young adults have become financially dependent upon their parents. In a new report from Pew Research Center, nearly 60% of parents said they were financially supporting their adult kids, ages 18 to 34.
According to the survey, 57% of young adults also live with their parents or in a parent’s home. The economic challenges posed by high housing costs, inflation and broader economic precariousness have made it difficult for many young adults to afford living independently.
Sixty-four percent of young adults who live with a parent say this arrangement has positively impacted their personal finances, while parents’ views are more mixed when it comes to the financial impact of living with their young adult child.
The Benefits Of Boomeranging Back Home
Living with parents can offer a supportive environment that allows for greater flexibility in pursuing educational or career opportunities, as well as providing a safety net during times of economic uncertainty.
It can have a positive impact on the mental health of young adults, especially in the face of a stressful job market. Forty-one percent of young adults rely greatly on their parents for emotional support, the study found.
Moving back home can help alleviate the financial strain associated with high rent and housing costs, allowing young adults to focus on paying off debt, saving money and working toward their long-term financial stability.
The Dilemma Of Young Americans
The total student loan in the United States is $1.75 trillion, which has more than tripled since the Federal Reserve started tracking it in 2006. The average American student debt per borrower is about $29,000, Forbes reported. This debt burden weighs heavily on young adults financially, limiting their ability to save and invest.
According to a Pew Research Center survey conducted in October 2021, about seven in 10 Americans believe that young adults today have a harder time paying for college, buying a home and saving for their future than their parents’ generation. Additionally, 39% of respondents said that finding a job is harder for young adults today than it was for their parents.
These findings come at a time when younger Americans are more likely than previous generations to have taken on student debt with tuition costs steadily rising, and to face an affordable housing crisis as rent and housing prices have grown markedly faster than incomes in the last decade.
These economic and job challenges have led to decreased upward economic mobility, with millions of young Americans facing obstacles in achieving financial security and the ability to support themselves.