While moving home may not seem like a privilege, economists suggest being able to "boomerang" home may have its advantages for young workers hoping to save money and search for new jobs.
Between February and March 2020, some 2.6 million young adults moved home with their parents. By the middle of 2020, the majority (52%) of young adults between the ages of 18 and 29 lived with at least one parent — and the children of rich parents were the most likely to return home.
While the share of young people living with a parent has fallen closer to 47% in recent days, new analysis is showing how wealthy families shelter young adults from the harshest consequences of difficult economic times.
According to recent research from the Federal Reserve Bank of Cleveland, most young adults who moved in with their parents during the pandemic (often referred to as "boomerang kids") come from high-income families. In fact, 36% of boomerang kids come from families that make over $140,000 per year, while just 10% of boomerang kids come from families that make less than $27,000.
The median household income was $67,521 in 2020.
"The pandemic's having unequal economic effects among young workers," says André Victor D. Luduvice, research economist at the Cleveland Fed and author of the report. "[Boomerang kids] have some cushion to weather economic shock."
The opportunity to move back home can often be a reflection of a family's financial stability, explains Luduvice. He points out that low-income families are less likely to live in homes with open rooms and are less likely to have the expendable resources to accommodate an additional adult.
"On average, boomerang kids come from higher-income families," says Luduvice. "We also see that they're less likely to be married, less likely to have children, and they also are more able to wait out an unemployment spell."
Among unemployed young adults, boomerang kids spent over 22 weeks not working, while unemployed individuals who lived independently spent fewer than 18 weeks looking for work.
To be sure, moving home with parents can come with emotional hurdles and not all young people who returned home are financially fortunate.
"I always applauded myself for being an independent 20-something who'd been living on her own for the past few years, so it felt strange to be back under my parents' roof," wrote Angely Mercado back in May 2020 for CNBC Make It.
Mercado lost her job in March 2020, moved back in with her parents and took on work writing "depressing" obituaries to make ends meet.
"I was embarrassed when I first told my parents about losing my job. I didn't want to be a burden, but my mom assured me that everything was going to be fine. Still, I can't help but check my bank account between assignments. We're barely getting by, and the stimulus checks have yet to arrive."
But for some, family circumstances mean they have extra time to "wait for a better job: potentially a higher-income job, or a job that is more suited to your needs, or a job that has less Covid exposure."
According to the researchers, young adults who do not live with their parents were nearly twice as likely to work in a job that puts them at a high risk of exposure to the virus.
Luduvice points out that many boomerang kids are in school, while young adults who live independently are significantly less likely to be in school.
Elise Gould, senior economist at the Economic Policy Institute says while it may be surprising that young adults from wealthier families would move home, there are some possible explanations.
For instance, since young adults from wealthier backgrounds are more likely to attend higher education, it makes sense why these students stayed home while campuses were closed. Plus, even young adults from higher-income families "may be paying off college debt."
"And I wonder if these people may also be more likely to have jobs where they can telecommute, and so they can work from their parent's house because it doesn't matter where they live," she says. "But people who are lower-income, maybe they have to stay close to their jobs and so they didn't have that option."