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How Did the Housing and Labor Market Crises Affect Young Adults' Living Arrangements?

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  • Rogers, William H.

    (University of Missouri-St. Louis)

  • Winkler, Anne E.

    (University of Missouri-St. Louis)

Abstract

The housing and labor market crises of the late 2000s left few families and individuals unscathed. In the wake of these events, evidence points to more "doubling-up" of families in the same household. To what extent have these crises affected individuals' decisions to live independently? What differentiates this study from others is the careful attention paid to the role of housing market conditions – as measured by MSA-level housing prices, rents, and foreclosure rates – on this decision. The empirical analysis is conducted by appending data on area-level conditions for 85 of the largest MSAs in the United States to individual-level data from the ACS PUMS on living arrangements of young adults ages 22 to 34 living in these MSAs. The analysis spans the period 2005 (pre-crisis) through 2011. Within this time period, all MSAs experienced a rise in housing prices, a peak, and then a decline. Regarding the area-level variables, we find a robust statistically significant effect for rent only. Our broader conclusion is that it is individual-level factors, not area-level conditions that largely lie behind young adults' living arrangement decisions.

Suggested Citation

  • Rogers, William H. & Winkler, Anne E., 2014. "How Did the Housing and Labor Market Crises Affect Young Adults' Living Arrangements?," IZA Discussion Papers 8568, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp8568
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    References listed on IDEAS

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    Cited by:

    1. Marianne Bitler & Hilary Hoynes, 2015. "Living Arrangements, Doubling Up, and the Great Recession: Was This Time Different?," American Economic Review, American Economic Association, vol. 105(5), pages 166-170, May.
    2. Christopoulou, Rebekka & Pantalidou, Maria, 2018. "Who saved Greek youth? Parental support to young adults during the great recession," LSE Research Online Documents on Economics 91954, London School of Economics and Political Science, LSE Library.
    3. Aaron Yelowitz, 2017. "Local housing costs and basic household needs," Empirical Economics, Springer, vol. 52(3), pages 901-923, May.
    4. Samuel Dodini & Jeff Larrimore & Jenny Schuetz, 2016. "What are the Perceived Barriers to Homeownership for Young Adults?," Finance and Economics Discussion Series 2016-021, Board of Governors of the Federal Reserve System (U.S.).

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    More about this item

    Keywords

    living arrangements; labor market; housing market; foreclosures;
    All these keywords.

    JEL classification:

    • J12 - Labor and Demographic Economics - - Demographic Economics - - - Marriage; Marital Dissolution; Family Structure
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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