Leaving home

Report
Leaving home:
independence, togetherness and income
in Europe
Maria Iacovou
The transition to adulthood
Series of transitions:
Finishing school
Getting a job
Leaving home
Partnering
Having children
Sequencing, and transitions themselves, not
universal.
Argument for expanding definition of youth
upwards
2
3
Motivation
Trend towards later home-leaving in OECD
countries
Conceptualised as being caused by adverse events
Unemployment, insecure employment, low incomes, etc
And as having adverse consequences
Lack of independence for offspring (and parents)
Financial consequences for parents
[Neither of these is necessarily true]
4
Data
All analysis (some from previous publications,
some new) from large-scale cross-national data
sets
European Community Household Panel (ECHP)
1996 – 2002: EU-15
European Union Statistics on Income and Living
Conditions (EU-SILC)
2004 onwards: EU-27
5
“North/Western”
cluster: UK, France,
Germany, Austria,
Belgium, Netherlands,
Luxembourg, Ireland
6
“Nordic” cluster: Sweden,
Finland, Denmark,
Norway
“North/Western”
cluster: UK, France,
Germany, Austria,
Belgium, Netherlands,
Luxembourg, Ireland
7
“Nordic” cluster: Sweden,
Finland, Denmark,
Norway
“North/Western”
cluster: UK, France,
Germany, Austria,
Belgium, Netherlands,
Luxembourg, Ireland
“Southern” cluster:
Greece, Italy, Spain,
Portugal, Cyprus,
(Malta)
8
“Nordic” cluster: Sweden,
Finland, Denmark,
Norway
“North/Western”
cluster: UK, France,
Germany, Austria,
Belgium, Netherlands,
Luxembourg, Ireland
“Eastern” cluster:
Estonia, Latvia,
Lithuania, Poland,
Czech R, Slovakia,
Slovenia, Hungary,
Romania, Bulgaria
“Southern” cluster:
Greece, Italy, Spain,
Portugal, Cyprus,
(Malta)
9
“Nordic” cluster: Sweden,
Finland, Denmark,
Norway, Netherlands
“North/Western”
cluster: UK, France,
Germany, Austria,
Belgium,
Luxembourg
“Southern” cluster:
Greece, Italy, Spain,
Portugal, Cyprus,
(Malta), Ireland
“Eastern” cluster 1:
Estonia, Latvia,
Lithuania,
Czech R, Hungary
“Eastern” cluster 2:
Poland, Slovakia,
Slovenia, Romania,
Bulgaria
Incomes lower than
(eg) Turkey,
Mexico, Chile,
Malaysia
10
Variations in the age at leaving home
38
36
34
32
Men
30
Women
28
26
24
22
NL FR UK DE
20
18
DK FI
EE AT BE
HU CY CZ
LT LU IE LV RO BG
PL ES
IT EL
SI SK PT
SE
Source: Adapted from Iacovou and Skew (2010)
11
Leaving home by age: four countries (men)
Denmark
100%
Left home, living
with partner
80%
60%
40%
40%
Living with
parents
Left home, living
with partner
80%
60%
20%
Germany
100%
Left parental
home, no partner
Living with
parents
20%
0%
Left parental
home, no partner
0%
15
20
25
30
35
40
Italy
100%
15
20
25
Left home, living
with partner
40
Left home, living
with partner
80%
60%
35
Bulgaria
100%
80%
30
60%
40%
Living with
parents and
partner
40%
Living with
parents
20%
Living with
parents
20%
0%
0%
15
20
25
30
35
40
15
20
Source: new analysis of EU-SILC (2007)
25
30
35
40
12
Denmark:
men (top) and
women (b0ttom)
100%
Left home, living
with partner
80%
60%
40%
Living with
parents
20%
Left parental
home, no partner
0%
15
20
25
30
35
40
15
20
25
30
35
40
100%
80%
60%
40%
20%
0%
13
Germany:
men (top) and
women (b0ttom)
100%
Left home, living
with partner
80%
60%
40%
Living with
parents
20%
Left parental
home, no partner
0%
15
20
25
30
35
40
15
20
25
30
35
40
100%
80%
60%
40%
20%
0%
14
Italy:
men (top) and
women (b0ttom)
100%
Left home, living
with partner
80%
60%
40%
Living with
parents
20%
0%
15
20
25
30
35
40
15
20
25
30
35
40
100%
80%
60%
40%
20%
0%
15
Bulgaria:
men (top) and
women (b0ttom)
100%
Left home, living
with partner
80%
60%
Living with
parents and
partner
40%
Living with
parents
20%
0%
15
20
25
30
35
40
15
20
25
30
35
40
100%
80%
60%
40%
20%
0%
16
Why does home-leaving vary so much?
Economic factors – income sufficiency, job security
Institutional factors – eg, welfare state
Housing markets – supply, price, mortgage
markets
Social norms
Family ties
17
“Independence” and “togetherness”
Independence = ability to make your own decisions,
support yourself financially, spend time alone…
Togetherness = sense of kinship / belonging
Assume everyone values both to some extent
Not mutually exclusive, but trade-offs for young adults
Reher (1998): “Northern” European model characterised by
weak family ties; “Southern” model of “strong” family ties
18
“Independence” and “togetherness”
CAN’T assume that societies where young adults live with
their parents are those with “strong” family ties or a
preference for “togetherness”
Look at the relationship between income and home-leaving
Higher incomes
POSITIVELY
related to earlier
home-leaving
Infer preference for independence
Higher incomes
NEGATIVELY
related to
home-leaving
Infer preference for togetherness
19
Analytical framework
Distinguish between parents and children’s incomes
Logit regressions separately for each group of countries
Sample of young adults aged 18-35 still living at home, analyse the
determinants of moving out the following year
Also control for:
Young person’s age (and age squared)
Economic activity (employed/unemployed/home and family/education)
Characteristics of family of origin (two-parent/stepfamily/lone parent)
Rooms per person (crowding)
Parents’ education & age at marriage
Maternal employment
20
Results
Own income positively
related to leaving home.
Infer preference among
young adults for
independence – strongest
in Nordic countries
Nordic
Men
Northern
Women
Men
Southern
Women
Men
Own income
0.011***
0.012***
0.004**
0.006***
0.005***
Parental income
0.004*
0.005*
0.005***
0.004***
-0.005***
Women
0.006***
-0.001
Source: adapted from Iacovou (2011)
Parental income ALSO
positively related to
leaving home in Nordic &
Northern countries.
But parental income is
negatively related to
leaving home in
Southern countries.
21
Distinguishing between destinations
Nordic
Men
Leave as a single
Own income
Parental income
Leave for partnership
Own income
Parental income
Leave for education
Own income
Parental income
Northern
Women
Men
Southern
Women
Men
Women
0.018***
0.005
0.019***
0.005
-0.001
0.005*
0.004
0.012***
0.004*
0.001
0.006*
0.004
0.014**
0.002
0.012**
0.005
0.008***
0.005**
0.008**
-0.001
0.005***
-0.006***
0.005***
-0.003*
-0.001
0.010*
0.004
0.010**
0.002
0.007*
0.005
0.012***
-0.007
-0.002
0.009**
0.008**
Source: adapted from Iacovou (2011)
Negative effect of
parental income now
apparent for both sexes
in Southern countries
22
Does the effect of income vary with age?
Answer: yes!
The effect of own income does not vary significantly with age
The effect of parental income does vary
Theory: parents use their incomes to delay home-leaving when
offspring are “too young”, and use their incomes to encourage
home-leaving when offspring are “old enough” (or “too old”).
How old is “old enough”?
About age 20 in Nordic countries
About age 22 in Northern countries
About age 27 for women in Southern countries
About age 35 for men in Southern countries
23
And Eastern Europe? Own income….
0.25
0.20
**
**
Men
Women
0.15
**
0.10
0.05
**
**
**
* **
0.00
Nordic
North
South
East (1)
East (2)
Effect positive
everywhere, but much
larger in Nordic countries
Adapted from Skew and Iacovou (2011)
24
And Eastern Europe? Parental income…
0.08
*
Men
0.06
0.04
Women
*
**
Effect positive in Eastern
[2] group (Romania,
Bulgaria, Slovakia,
Slovenia, Poland)
0.02
0.00
Nordic
North
South
East (1)
East (2)
-0.02
-0.04
**
Effect negative in
Eastern [1] group (Baltic
states plus Hungary and
Czech Republic)
25
Returns home
Finland
Denmark
Netherlands
UK
Belgium
Luxembourg
France
Germany
Austria
Ireland
Percentage of parents
Portugal
Percentage of young people
Spain
Italy
Greece
0
1
2
3
4
5
Percentage experiencing a return home
Source: Iacovou and Parisi (2009), using data from the European Community Household Panel
26
Conclusions
Wide variations in age at leaving home
Many factors involved in variations – within and
between countries
Norms play a role
Preferences for togetherness versus independence
play a role
Economic constraints evident, particularly across
some countries of Eastern Europe
27
Who supports whom?
Poverty, financial strain and intergenerational co-residence
Maria Iacovou and Maria Davia
Young people’s incomes as a % of their household’s incomes
(sample: young people aged 19-34 living with their parents)
30
25
20
15
10
5
0
LV UK IE
EE ES BG CZ AT HU NL LT PT
SI NO DK GR RO IS
SK
IT
SE CY
FI
PL BE DE LU FR
Reasons for variation
Household size
One parent/two parents/other adults/children
Employment
Youth employment rates
Parents’ employment rates
Employment of other adults in household
Wages
Wages of young adult in relation to parents’ wages
Benefits
29
29
UK
25
23
21
IS
19
17
DE
FR
LV
25
23
21
IS
19
LU
DE
17
FR
15
15
20
30
40
50
60
70
% with 2 parents in paid work
LV
27
IE
UK
25
23
21
IS
19
DE
17
FR
15
0
5
10
15
20
25
% with no parent in paid work
30
35
40
45
% with 1 parent in paid work
29
mean % h/h income from YP
IE
UK
27
mean % h/h income from YP
mean % h/h income from YP
LV
IE
27
30
35
50
55
29
mean % h/h income from YP
LV
IE
UK
27
25
23
21
19
CY
LU
DE
17
FR
15
10
20
30
40
% living with one parent only
50
29
IE
mean % h/h income from YP
27
LV
UK
25
23
21
IS
19
DE
17
FR
15
35
45
55
65
75
85
% of young people who have a job
Do the level of earnings, as well as having a job, matter?
29
IE
LV
UK
mean % h/h income from YP
27
25
23
21
19
17
DE FR
15
20
30
40
50
60
70
80
90
mean youth LAH earnings as % of fathers' earnings
do we observe this pattern just because of age differences
between the young people still living at home?
29
29
IE
LV
UK
25
23
21
19
DE
17
IE UK
27
mean % h/h income from YP
mean % h/h income from YP
27
LV
25
23
21
19
DE
17
FR
FR
15
15
20
30
40
50
60
70
80
90
mean youth LAH earnings as % of fathers' earnings
22
23
24
25
26
27
mean age of young person LAH
29
IE
mean % h/h income from YP
27
LV
UK
25
EE
23
SI
Both the age distribution AND
age-earnings profiles
contribute to differences in
earnings
21
19
PL
DE
17
FR
15
40
60
80
100
Earnings of 23-28 as % of earnings of 50-55
120
Scandinavian countries: many 2-earner
parents; low-ish youth employment rate,
low youth earnings
30
25
20
15
10
5
0
LV UK IE
EE ES BG CZ AT HU NL LT PT
SI NO DK GR RO IS
SK
IT
SE CY
Including predicted levels………….
FI
PL BE DE LU FR
North/Western countries: fairly low % with
jobs (except AT and NL!), low youth
earnings (again, except AT and NL)
30
25
20
15
10
5
0
LV UK IE
EE ES BG CZ AT HU NL LT PT
SI NO DK GR RO IS
SK
IT
SE CY
Including predicted levels………….
FI
PL BE DE LU FR
High employment
and relative
earnings; high %
lone parents
Low % of 2-worker parents,
high % with jobs, fairly high
% with only 1 parent.
30
25
20
15
10
5
0
LV UK IE
EE ES BG CZ AT HU NL LT PT
SI NO DK GR RO IS
SK
IT
SE CY
Including predicted levels………….
FI
PL BE DE LU FR
These figures cover entire income range
Are there differences between rich and poor households?
Expect young people in wealthier households to “contribute” a lower %
of the household’s income
< 75% median income
30
75-100% median income
25
> 100% median income
20
15
10
5
0
NO
IS
DK
SE
FI
< 75% median income
30
75-100% median income
> 100% median income
25
20
15
10
5
0
LV
EE
BG
CZ
HU
LT
SK
RO
SI
PL
< 75% median income
30
75-100% median income
25
> 100% median income
20
15
10
35
5
30
0
25
ES
PT
CY
GR
IT
< 75% median income
75-100% median income
> 100% median income
20
15
10
5
0
IE
NL
UK
AT
DE
LU
BE
FR
Omitted material...

Multivariate analysis of characteristics associated with high % of
incomes
YPs’ role in determining poverty status
Calculate household income and poverty status
Counterfactual: “remove” young person and all the
income associated with their presence in the
household
Calculate counterfactual poverty status of
household
Allocate hypothetical benefits to young person and
calculate their counterfactual poverty status
Eight possible sets of outcomes
% of households below 75% median
10
Not poor - would be poor if YP left
9
Poor - wouldn't be poor if YP left
8
7
6
5
4
3
2
1
0
SE IS FR LU FI BG CZ NO NL BE RO SK PL HU CY DK EE LT IT PT SI DE UK LV AT IE GR ES
The issue of sharing
Adult children don’t always share their funds with the rest
of their households
But we can assess the extent to which children contribute
to household coffers, as follows:
HS120: describe your ability to make ends meet
6-point scale, from “great difficulty” to “very easily”.
Generate a variable indicating year-on-year change
Take a sample of households with young adults co-resident
with parents in year t
Generate variable indicating if young people leave home
Multinomial regressions of change in making ends meet
Define 3 outcomes: worse – same – better
What do we expect?
Get worse
Stay the same
Improve
YP with job leaves
YP without job leaves
+
household loses YP’s income
which they previously shared
OR
N/S if YP was not sharing their
income
+
if those remaining in the household
have to continue subsidising the YP
-
-
+
if the household were already
subsidising the YP
+
if those remaining in the household
no longer have to subsidise the YP
OR
N/S if those remaining in h/h still have
to subsidise the YP
Marginal effects: all countries pooled
(sample of households with YP aged 25-25)
YP with job leaves
YP without job leaves
5.8% ***
-2.4% ***
Stay the
same
-
-
Improve
0.1% n/s
4.9% ***
Get worse
By country groups:
YP with job
leaves
Nordic
North/West
Southern
Eastern
YP without
job leaves
Get worse
8.5 *
3.6
Improve
2.9
7.6 *
Get worse
3.5
-7.0 ***
- 0.7
4.8 *
Improve
Get worse
7.2 ***
0.5
Improve
-0.2
6.1 ***
Get worse
4.0 ***
Improve
1.0
-4.0 ***
3.8 ***
Next steps
Already:
Looked at age of young person: no systematic differences between 25-29s
and 30-35s
No difference between men and women, once you control for income
Control for contemporaneous changes in
Income of other family members
Household composition
YP getting or losing a job but remaining in household
Assess the % of YPs’ income which is “shared”
Look (cross-sectionally) at the relationship between YPs’ incomes and
parents’ subjective assessments.
Conclusions
Economic support between young people and their
families is not all one way
Young people’s incomes do contribute, in some
meaningful way, to their families’ sense of financial
security
The degree of this contribution is strongly related
to young people’s incomes and labour market
status

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