During the economic collapse of 2008-2009, the share of younger Americans living with their parents skyrocketed and then, through several years of recovery, held at its new, worryingly high level.
Young people are finally moving out of Mom’s basement
But good news for moms! Now, Goldman Sachs reports in a circular for clients that while it’s still elevated, the number of twenty-somethings living with mom seems to be on the decline:
This trend isn’t just caused by economic growth — it’s going to lead to more economic growth, too.
An improving economy is giving more young people the resources they need to strike out on their own. But the neat thing about household formation is that it’s associated with a lot of durable goods purchases. When kids move out, they not only need a house to live in, they need a bunch of stuff to fill the house with, boosting demand for toasters and towels and tea kettles and all the rest of it.
So kids moving out of their parents’ basement isn’t just a sign of a recovering economy. It will actually help the economy recover further.
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