Millennials aren’t moving. A new report from the Census Bureau sheds light on recent news of a seriously declining homeownership rate and a fall in household formations.
In 2012, the rate of domestic migration increased to 12% from 11.6% in 2011. However, the rate tumbled back to 11.7% from 2012 to 2013, revealing the recent gains did not indicate a long-term trend.
The decline came primarily from a dramatic and continuing drop in short-distance moves (relocations within the same county). Intra-county migration accounts for the majority of moves made by Americans. While longer distance moves typically occur due to job placement, short-distance moves usually take place when the young leave their nest or when homeowners upgrade — neither of which are happening much these days.
This year, short-distance moves fell to a post-WWII record low of 7.5%. The primary reason for the decline was a lack of mobility among young adults aged 25 to 34, according to William Frey of the Brookings Institution.
Stifled mobility among the young is a classic catch-22: they can’t move if they can’t find a job, but they can’t find a job if they can’t move.
Right now, Millennials incubate in their parents’ suburban sinkholes; hardly an ideal priming of the next generation’s economic engine. Millions of dollars of talented, educated human capital languish in third and fourth bedrooms that ought to have been converted into man caves or crafting dens by now.
In order for the talent to be unleashed on the economy two things need to happen: wages need to increase and rent/prices need to fall in urban city centers. Unless you think recent college grads can pay $3,200 a month for a San Francisco apartment.
