Economic precariousness and living in the parental home in the UK

Abstract

Today’s young adults are facing increased economic uncertainty as a result of unemployment, the continued growth of low-paid, insecure and often part-time employment, accelerated by the recent economic downturn. Recent media attention has focused on the trend for increased co-residence of adult children with their parent(s). It is generally assumed that this trend relates directly to the increased economic uncertainty of young adults, combined with the challenges of affordability in the housing market. This research is motivated by the need to identify which groups are most at risk of economic uncertainty and to investigate the consequences for young adults’ abilities to make successful transitions to adulthood. The paper contributes to the literature on both youth employment and housing transitions and the intersection of both.

The aim of the paper is three fold: 1) To explore how different aspects of precariousness (labour market insecurity, employment insecurity, and income insecurity) can be operationalised using quantitative data; 2) To use these indicators to provide estimates of precarity amongst young men and women aged 18-34; 3) To examine how these indicators are related to the likelihood of living in the parental home. We use data from the first wave of the United Kingdom Household Longitudinal Study (UKHLS) which was conducted in 2009/10, at the height of the economic downturn. By disaggregating analyses by gender and age we get beneath aggregate summary statistics and provide new insights into how young people’s experience of employment changes across the transition from older teenager, to those in their twenties and for those in their early thirties.

The survey data suggest considerable income inequalities between young adults. Not surprisingly, the unemployed and economically inactive are concentrated in the lowest income quartiles. Among employed young adults, income levels differ significantly according to the hours worked, and occupational status. Our analyses show that young people are over-represented in routine and semi-routine jobs, most of these jobs tend to be low-paid and are in the bottom income quartile. Whilst the proportion in routine and semi-routine jobs decreases with age as young people gain the necessary skills and experience to climb the occupational ladder, a sizeable proportion – about one in five men and women in their early thirties remain in a routine or semi-routine job.

A significant minority of young adults are self-employed. Among this group, we find a bi-modal income distribution, suggesting that for some, self-employment is an entrepreneurial success story. However, over one half of the self-employed in their late twenties and early thirties are in the lowest quartile suggesting that for others, self-employment is a new form of precarity. This research also quantifies the extent to which different indicators of precarity are related. We find that young adults often face multiple dimensions of economic precarity. For example, male part-time workers tend to have lower personal incomes, and part-time work is associated with being on a temporary contract and being in semi-routine or routine jobs.

Almost all the indicators of precariousness were found to be associated with a higher likelihood of living in the parental home, suggesting that these young adults face constraints on their ability to make the transition to residential independence. Some differences are seen according to age. For men and women aged under 25, both unemployment, being temporary or part-time employed, or being in a (semi)routine job are associated with a higher likelihood of remaining in the parental home. By their late twenties only a small proportion of women, but a higher proportion of men remain living with their parents. At these ages, it is unemployed and economically inactive and men in (semi) routine jobs, and men with lower levels of personal income who are significantly more likely to remain living with their parent(s).

This research has implications for various actors including national and local government, housing agencies and employee groups as well as the self-employed. Young adults are concentrated in parts of the economy dominated by zero and short-hours contracts and governments should regulate these types of contracts. In addition, uncertainties associated with self-employment need to be recognised since they may have implications for making stable housing and family transitions. New policies need to consider the groups struggling most with housing costs; young single people, especially those without children, who are renting single bedroom properties, particularly in London. Furthermore, policies need to be developed to support pay and skills progression among young adults.

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Identifiers

ORCID for Ann Berrington: orcid.org/0000-0002-1683-6668

ORCID for Teresa McGowan: orcid.org/0009-0002-9231-3743

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