Coronavirus: Will job losses see another rise in the Boomerang Generation?

With social media forums filled with young freelancers starting to lose their livelihoods and worried about paying their rent, Liz Emerson, IF Co-founder, looks at the wider implications should the government choose not to help young renters beyond lifting the threat of eviction

I spend a lot of time talking to younger generations in my non-party-political work protecting their interests with policy-makers. As the coronavirus has taken hold, the forums I frequent are increasingly filled with young people sharing their bad news: losing contracts, being laid off, worried about making ends meet, and worried about paying their rent.

The government decision to help mortgage-holders by giving them three-month mortgage holidays (with no risk to their credit scores should they go down with the virus) is of little comfort to younger generations if the break that their landlords receive is not passed on to them.

IF has helped with raising awareness of the need for better protection for young renters and we welcome the PM’s announcement of a ban on evictions, but a three-month moratorium will do little to help if the economy is damaged in the long term.

So, what can we expect for the futures of the Millennials and Zennenials (Generation Z: those born between about 1995 and 2010) once we have got through the other side of this national emergency? Remember, they have already lived through and inherited a period of austerity following the global financial crisis, a poisoned chalice of the highest student debt on record in the UK, insecure employment and high housing costs, as well as the inability to save much for the future.

New graduate unemployment…

…and that’s if they manage to graduate at all. Some students are already asking on social media for their entire year’s course fees back, and why shouldn’t they? They’ve had to deal with prolonged strike action for a “marketised service” for which they pay very highly – £9,250 a year fees with interest rates at RPI+3% (currently 5.4% but has been as high at 6.9%). Dissatisfied customers are given refunds in other business areas to why not here?

If they do manage to graduate this year, another 500,000 university leavers will be entering the workforce alongside those young people already in a precarious employment market. While the employment rate is at a record high do remember that 15% of the workforce are self-employed, with much less than three months’ savings to fall back on.

And not all jobs will be graduate jobs. Close to half of all recent graduates (47%) were working in non-graduate jobs in 2018. For non-recent graduates (those working for more than five years), there is a drop, but 36% were still working on non-graduate jobs.

Non-graduate jobs could well have included one of the 1.8 million contracts that did not guarantee a minimum number of hours in 2018. The number of people employed on zero-hours contracts as their main job was 900,000. Just over a quarter of people on zero-hours contracts surveyed want more hours in their own job.

We also know from all the work we do on low pay that long periods of unemployment have a long-term economic scarring effect on the wages of young people who suffer from a lack of employment.

Moving back home

Expect the return of the Boomerang Generation; the Millennials who just about managed to fly the nest are likely to be coming home, if there is a home to come to. The Office for National Statistics (ONS) reported in December 2019 record numbers of Millennials returning to the family home, that’s 3.5 million 20- and early 30-somethings who have had no choice but to remain in the family home.

And moving back home means once again that the generation who have already lived through 9/11, a worldwide economic collapse, austerity, and now coronavirus, will not be able to get on with their lives as previous generations have been able to.

Furthermore, as IF’s Wellbeing Index reveals (next edition out soon), there has been a dramatic 50% decline in the quality of family relationships in terms of young people identifying one of their relatives as one of their closest friends. How the coronavirus will affect family structures over the long term is yet to be seen.

Photo by Mikail Duran on Unsplash:

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