The Continued Growth of Multigenerational Living

by Shannon Rieger
Research Assistant

A substantial number and share of older Americans are living in “multigenerational” households, according to our analysis of recently released 2015 American Community Survey (ACS) one-year population estimates. In total, 20.3 percent of all non-institutionalized adults aged 65 and over – about 9.4 million people – live in multigenerational households that include at least two generations of adults (individuals over the age of 25). The ACS data also show large differences in the prevalence and composition of multigenerational homes by age, race, and ethnicity.

The new data not only reflect the fact that there are a growing number of older Americans, but also that the share of older Americans living in multigenerational homes has been growing steadily since the 1980s. These trends are likely to continue as baby boomers age. Importantly, multigenerational living might allow some older Americans to enjoy a higher quality of life while aging in place, as an overwhelming majority of people want to do. At the same time, for some families of limited means, multigenerational living may be a financial necessity rather than a desirable living situation. Regardless of why they are choosing multigenerational living arrangements, providing families with education and support to suitably modify their homes could help these arrangements be as safe, effective, and beneficial as possible.

Who Lives in Multigenerational Homes?

About two-thirds of the 9.4 million older adults living in multigenerational homes live in households that have exactly two adult generations (usually parents and adult children aged 25 or older). The rest are in three-or-more-generation households that typically include grandparents, adult children, and grandchildren.

Trends in multigenerational living also change with age (Figure 1). The share of people living in multigenerational settings is highest for individuals in their late 20s (mostly due to adult children still living at home), then drops for those in their 30s as young adults move out and form their own households. The share rises again for people in their early 40s until peaking at about 23 percent for people in their late 50s. This “sandwich” age group includes people who are living with their adult children, those who are living with their aging parents, who often need daily support and care, and those living with both their children and aging parents.

Notes: Multigenerational households are those with least two adult generations aged 25 or older or that include grandchildren, adult children, and grandparents. Householders and parents are considered “adults” regardless of age. Other household members include extended family members (e.g. aunts, uncles, nieces, nephews) and unrelated individuals. Source: JCHS tabulations of US Census Bureau, 2015 American Community Survey 1-year Estimates. 

Because adult children move out and elderly parents pass away, the share of people living in multigenerational households declines for people who are in their 60s and early 70s. However, the share rises steadily for older adults in their mid-70s, who often are starting to face more daunting health and financial challenges. Among the oldest age groups (aged 85 and over), 27 percent – about 1.5 million people – lived in multigenerational households in 2015.

In addition to differences in age, people of color and foreign-born individuals are far more likely to live in multigenerational settings than non-Hispanic whites and people born in the United States (Figure 2). More than 25 percent of native-born blacks, Hispanics, and Asians/others aged 65 and over live in multigenerational homes, as do more than 45 percent of foreign-born in all three of these groups. In contrast, 15 percent of native-born non-Hispanic whites of the same age, and just over 20 percent of foreign-born non-Hispanic whites, live in multigenerational households. 

Notes: Whites, blacks, and Asians/others are non-Hispanic. Hispanics may be of any race. Multigenerational households are those with least two adult generations aged 25 or older or that include grandchildren, adult children, and grandparents. Householders and parents are considered “adults” regardless of age.

Source: JCHS tabulations of US Census Bureau, 2015 American Community Survey 1-year Estimates. 

A sizeable subset of these multigenerational homes include at least three generations: usually grandparents, adult children, and grandchildren living together under the same roof. Roughly ten percent of native-born blacks, Hispanics, and Asians/others aged 65 or over live in such households, along with around 25 percent of foreign-born older adults in each group. Among non-Hispanic whites, just under 4 percent of older native-born adults and 7 percent of the foreign-born live with three or more generations.

Looking forward, projected growth and demographic shifts in the older population seem likely to increase the number of multigenerational households and the share of people living in those households. The U.S. Census Bureau’s most recent population projections estimate that by 2035, about 79 million Americans will be age 65 or older, an increase of more than 30 million people in just two decades. This growth is due to the fact that the baby boom generation is getting older and because with increases in longevity more people will live well into their 80s, 90s, and beyond.  In fact, the Census Bureau projects the number of “oldest old” adults aged 85 and over to double over the next two decades.

The racial and ethnic composition of the older population will also shift markedly over the next several decades. The non-Hispanic white share of the 65-and-over population is projected to drop nearly ten percentage points to 69 percent by 2035, while the black, Hispanic, and Asian shares will rise, respectively, by 20 percent, 67 percent, and 39 percent (Figure 3). Census Bureau projections estimate that the foreign-born share of the 65 and over population will also continue to increase, growing from 13 percent in 2015 to 19 percent in 2035. Though the direction of future residential preferences among the older population is uncertain, the sheer magnitude of growth in the older population and the fact that much of the growth will be among the very old, people of color, and the foreign born suggests there will be substantial growth in multigenerational households in the coming years. 

Notes: Whites, blacks, and Asians/others are non-Hispanic. Hispanics may be of any race.   

Source: JCHS tabulations of US Census Bureau, 2014 Population Projections. 

Impacts on Housing and Services

As this growth occurs, it will be important to consider how new and existing housing stock might be designed or modified to best meet the needs of multigenerational households. Universal design features including single-floor living, zero-step entrances, and hallways and doorways wide enough to accommodate wheelchairs, walkers, or strollers can make homes more accessible for older adults with mobility limitations as well as for their young grandchildren. Flexible layouts that can change as family needs evolve, as well as the addition of semi-private spaces for each generation (such as in-law suites with separate entrances, multiple master bedrooms or kitchens, and accessory dwelling units), can also help make the housing stock better suited for multigenerational households.

While multigenerational living works well for many households, it is important to note that it is not necessarily a desirable option for every family. Rather, multigenerational living may be a financial necessity rather than an attractive housing option not only for families with lower incomes but also for moderate-income families living in higher-cost areas. Further, sharing a home with multiple generations can be challenging, particularly if the house is small, has inadequate amenities, or there are unclear or unrealistic expectations about responsibilities for both finances and personal care. Finally, informal help from family members may not be an adequate replacement for professional care, particularly for aging adults with serious health conditions. Providing families with guidance about how to live successfully in multigenerational settings, and, perhaps, with financial assistance to make home upgrades and modifications, will therefore be critical if multigenerational living is going to be an appealing, comfortable option for families of all means. While designing and carrying out such policies and programs will be challenging, such efforts have the potential to provide a more appealing and cost-effective housing option for older Americans and their families.

Homeownership Rates for Children of Immigrants—Age Matters

by George Masnick
Senior Research Fellow

Analyses of data used in a recent Census Bureau report show that homeownership rates for younger adult children of immigrants are substantially higher than rates for immigrants in the same age cohorts. In addition, while homeownership rates for native-born residents with native-born parents under age 45 are higher than those for the children of immigrants, members of the latter group quickly make up this deficit after the age of 45.

These findings emerge from additional analyses of data used in a first-ever report on the characteristics of three generations of US residents by nativity that was released late last month by the Census Bureau. The report is the first to use a unique question in the Current Population Survey‘s Annual Social and Economic Supplement (CPS/ASEC) asking the birthplace of both the respondent and the respondent’s parents. This allows one to identify people born abroad (1st generation), native-born children of at least one immigrant parent (2nd generation), and those whose parents were both born in the United States (3rd-and-higher generations).

The Census report discusses differences among the three groups in such areas as age, education, labor force participation, income, poverty, occupation, and homeownership. The last section is particularly interesting because other Census Bureau data the Joint Center has used to study homeownership, such as the Decennial Census, the American Community Survey, and the American Housing Survey, do not ask respondents where their parents were born. Moreover, as I have shown in an earlier post that also used CPS/ASEC data, immigrants are an important part of a recovering housing market. Foreign-born people have accounted for about one-third of all net household formations over the past two decades, and slightly under 30 percent of all gains in owner-occupied housing. Fully half of all household growth between 1994 and 2014 by under-30-year-olds came from 2nd generation children of immigrants, and another 35 percent from immigrants themselves.

The Census Bureau report notes that incomes and homeownership rise sharply between the 1st and 2nd generations but tend to level off for the 3rd-and-higher-generations. However, these findings may obscure significant differences between the 2nd and 3rd-plus generations because, as other parts of the Census Bureau report note, the generations have dramatically different age distributions. In particular, the majority of immigrants are middle-aged, and their children are 20 or younger. Adult children of immigrants have their largest percentages in the under-30 age group. Baby boomers dominate the 3rd-and-higher generations at age 50-70 in 2013 (Figure 1).

Source: U.S. Census Bureau, Characteristics of the U.S. Population by Generational Status: 2013, Current Population Survey Reports, Nov. 2016, Figure 9.

Because of these differences in age structure, it is impossible to compare the three generations broadly on any variable that varies with age, such as income or homeownership. For example, as the Census report shows, the median income among all individuals age 15 and over rises dramatically from $36,669 for the 1st generation to $46,764 for the 2nd generation. But, at $46,795, it is virtually unchanged for the 3rd-and-higher generations. However, when the data are broken down by age groups, they tell a somewhat different story. The Census report, which looks at median personal income for four broad age groups, shows significant income advantages for the 2nd generation over the 3rd-and-higher generations for 25-44, 45-64, and 65+ year olds. When median household income (a more relevant definition of income with respect to homeownership) is broken down into 5-year age groups, the 2nd generation can be seen to earn significantly more than their parent’s generation at every age, and importantly, more than the 3rd-and higher-generations as well (Figure 2).

Source: Joint Center for Housing Studies tabulation of 2015 CPS/ASEC data.

The need to control for age is especially important when examining generational differences in homeownership. In four of the five household family types discussed in the Census report, when age is not controlled, 2nd generation homeownership rates are lower than those for the 3rd-and-higher generations (and in the fifth, the difference between the groups is quite small) (Figure 3).

Source: U.S. Census Bureau, Characteristics of the U.S. Population by Generational Status: 2013, Current Population Survey Reports, Nov. 2016, Fig. 28.

If we control for age, would 2nd generation homeownership rates still be lower than those for the 3rd-and-higher generations? Also, since the Census report examined generational differences for a single year (2013), if there are differences by age, how well have they held up over time?

To answer these questions, we examined homeownership rates by age by 5-year age groups for the three generations for each year 1994-2015. These tabulations first can be summarized by examining the trends for two broad age groups (Figures 4 and 5). For households age 25-44, 2nd generation homeownership rates are well above those of their parents’ generation but below those of the later generations. This last pattern is partly explained by the greater concentration of younger 25-34 year olds in the broader 25-44 age group for the 2nd generation, and probably also due to the greater concentration of immigrants and their children in locations that have below average homeownership rates, such as the Los Angeles, San Francisco, New York City, Boston, and Chicago metropolitan areas. There might also be a greater ability of 3rd-and-higher generation parents to help their children financially in buying their first home, and a corresponding need for children of immigrants to save longer for a downpayment.

Source: Joint Center for Housing Studies tabulations of 1994 through 2015 CPS/ASEC data.

Source: Joint Center for Housing Studies tabulations of 1994 through 2015 CPS/ASEC data.

This analysis also shows that among younger adults the gap between the homeownership rates of the 2nd and 3rd-and-higher generations has widened since the Great Recession. The growing gap might be due to compositional shifts within the broad 20-year age cohort in such factors as age, ethnic composition, household composition and income. Alternatively, tightening credit markets might affect the generations differently. This could be particularly important for undocumented members of the 2nd generation. In any case, both the generational gap for younger adults and their recent trend certainly deserve further investigation.

For the broad adult age group over age 45, the story is quite different. Among older adults, the homeownership rates among the 2nd and 3rd-and-higher generations have been essentially equal for the past two decades except for a few years at the height of the Great Recession. The slower entry into homeownership we noted for younger 2nd generation households appears to have simply reflected the timing of the transition from renting to owning, rather than the effects of any structural differences between these two generations. After age 45, the 2nd generation has consistently closed the gap with the 3rd-and-higher over the past two decades. Another way to look at this homeownership data is to follow different birth cohorts of young adults as they age from the 25-44 age group into the 45-64 group. For each of the five-year 2nd generation cohorts under age 45 in 1995, the homeownership rates are lower than the respective cohorts in the 3rd-and-higher-generations. However, by 2015, when each of these cohorts is 20 years older, the homeownership gap between the generations has been completely eliminated (Figures 6 and 7).

Source: Joint Center for Housing Studies tabulations of 1995 CPS/ASEC data.

Source: Joint Center for Housing Studies tabulations of 1995 CPS/ASEC data.

The higher median income of 2nd generation adults above age 45 perhaps provides just the leverage they needed to make up the lost ground. And it is also likely that the older 2nd generation households are more concentrated in locations that have lower homeownership rates than the national average. If we could control for metropolitan location as well, middle-aged 2nd generation age-specific homeownership might well be higher than for the 3rd-and-higher generations. Unfortunately, the CPS/ASEC sample size does not allow such sub-national trends to be observed.

In sum, it is important to underscore that failing to recognize the important age differences between the three generations can lead to erroneous conclusions about levels and trends in income and homeownership. Because the 2nd generation age structure is so young, comparisons that lump adults of all ages together will result in unduly low incomes and homeownership for this group. As the Census report concludes, most 2nd generation U.S. residents surpass their parents’ generation in many measures, particularly education, income and homeownership. Once proper age controls are introduced, they equal or surpass the 3rd-and-higher generations in these dimensions as well.

When Boundaries Matter: Counties, Census Tracts, and Anti-Poverty Programs

by Sonali Mathur
Research Assistant

Recent discussions about potential federal anti-poverty programs underscore that seemingly mundane choices about geographic units could have important impacts on how available funds are distributed.

In a recent New York Times op-ed, Hillary Clinton asserted that if elected, she would develop an anti-poverty strategy modeled on the “10-20-30” approach put forward by Congressman James Clyburn (D-South Carolina), the number three Democrat in the House.

Initially proposed during the drafting of the American Reinvestment and Recovery Act, the 10-20-30 approach called for 10 percent of funds of federal programs subject to this plan be directed to persistent poverty counties where at least 20 percent of the population has been living in poverty for 30 years.

While this may have worked for the original intent of appropriately directing the rural development funds, the county based approach may not necessarily work across a wider range of programs and may not be the right approach to address extreme poverty.

While most discussion about the anti-poverty proposal has been focused on the money that would be made available, the geographic level used to allocate funds – be it counties, neighborhoods or something else – will significantly affect where the money would be spent and who would benefit from it.

Most notably, basing the selection criteria at the county level would tend to allocate money mostly to rural parts of the United States. Shown below is the map of persistent poverty counties (defined as any county that has had 20 percent or more of its population living in poverty in the 1990, 2000 and 2010 decennial censuses).

Source: JCHS tabulations of decennial census and American Community Survey 2006-2010 
Note: The exact list of eligible counties may vary based on the data source used. The choice of American Community Survey data (ACS) 2006-2010, ACS2007-2011 or Census bureau’s small area estimates results in the difference.

The county-based approach results in a majority of persistent-poverty areas being rural counties spread across 30 states; (85 percent of these counties are in non-metropolitan areas) and this approach excludes many areas of extreme poverty in inner cities of urbanized areas such as Los Angeles (Los Angeles County), Detroit (Wayne County), Chicago (Cook County), Dallas-Fort Worth (Dallas and Tarrant Counties), Newark (Essex County, New Jersey) and the District of Columbia.

In comparison, when applied at the census tract level, which is a much smaller geography than a county, the 20-30 rule yields a much broader array of urban, suburban, and rural communities of extreme poverty with a broader representation across states. At the census tract level, at least one persistent-poverty tract appears in each of the 50 states and in DC. In all, the tract-level application results in a total of 8,472 persistent-poverty tracts, which together are home to 30.7 million people (ACS 2010-2014). Only about 8.5 of these people are in persistent poverty counties. This implies that the county-level application of the 10-20-30 rule would exclude nearly 22.2 million people who live in persistent-poverty census tracts that are not in persistent-poverty counties.

Click image to launch interactive map. Please note: Maps may take a moment to fully render.

Yet another layer of complexity arises when you consider the many areas where at least 40 percent of the population is in poverty but have not had high poverty rates for the last three decades. These areas include 776 census tracts that are home to 2.8 million people, (ACS 2010-2014) that are not persistent-poverty tracts. Moreover, approximately 10.8 million people live in census tracts where at least 40 percent of the population is in poverty but the county is not considered a persistent-poverty area. Including these areas in anti-poverty efforts is important because numerous studies, including Harvard University’s Equality of Opportunity Project, have shown that concentration of poverty amplifies the adverse effects of poverty, as individuals deal not only with their own poverty but of those around them as well.

In short, the application of the 10-20-30 rule at the county level would exclude the vast majority of poor people who live in urban and suburban census tracts that are in persistent poverty. Additionally, focusing on persistent poverty tracts alone would exclude some areas that currently face concentrated poverty but may not fit the definition of persistent poverty.

It should be noted that Clinton’s op-ed used the term 'communities' instead of 'counties' perhaps signaling that her application of the rule might be at a smaller geography than counties. Although, there have been other reports where she has been quoted to show support for Clyburn’s original formula with the use of the term 'counties', and it also appears that the formula has made its way into several congressional proposals, which makes it imperative to discuss the geography of its application.

Article review- “Patriarchy, Power, and Pay: The Transformation of American Families, 1800-2015”

George Masnick
Senior Research Fellow

At my age, there is little that makes my jaw drop, especially while reading an article in one of my professional journals. However, this is exactly what happened when “Patriarchy, Power, and Pay: The Transformation of American Families, 1800-2015” by Steven Ruggles appeared in the latest issue of Demography. (Another almost identical version of this paper is available free of charge here.) What struck me as amazing is the way Ruggles provides a long-term perspective on many of the demographic and economic trends taking place today that I have studied using a much shorter time frame. And by long-term, we are talking 150-200 years!

The Joint Center for Housing Studies' early effort to describe changes in household structure and the labor force participation of American womenThe Nation's Families, 1960-1990– adopted a temporal perspective from 1960-1990. Published in 1980, we thought at the time that a three-decade perspective was all that was needed to understand the dramatic changes of that era. Wrong! The longer historical perspective sheds much more light on the origins of today’s demographic shifts, particularly in household structure, and what they might mean for housing.

Ruggles begins with the trend in the share of persons age 65+ who live in multi-generational families. We have noted the increase in this household type during the past two decades, primarily due to the increasing share of Hispanic and Asian immigrants for whom multi-generational residence is more common, and have speculated about its implications for housing consumption. But since we housing researchers rarely look at trends spanning more than 30 or 40 years, we have no sense of whether the upward trend in multi-generational living is indeed all that significant.

Ruggles’ Figure 1, reproduced below, shows how slight the recent turnaround has been relative to longer-term historical levels. The high share of the labor force based in an agricultural economy drove the very high historical incidence of older Americans living in multi-generational households. Three quarters of the labor force in 1800 worked in agriculture, and farm labor still was in the majority in 1850 when the share of 65+ living in multi-generational families was also 75 percent. Ruggles explains convincingly why an agricultural based economy tied the generations together, and why the rise of wage labor off the farm split them apart.



Ruggles’ main theme is that the decline of what he calls the “corporate family” – those working in agriculture and other (often related) family businesses – and the gradual transformation of the workforce to include first only male breadwinners, and later dual earner and female breadwinner households – had the effect of making household structures both simpler and more fluid. Once again, his long-term perspective is enlightening in looking at the recent trend in such things as delayed marriage and divorce. Age at first marriage for both men and women has been rising steadily since 1960, and he predicts that the share of never-married 40-44 year old women will almost double in the near future, rising from 15 percent in 2010 to about 28 percent in 2030. Similarly, the rate at which married women are divorcing has increased steadily since 1960, showing no sign of this trend slowing. Consequently, the share of all households without a married couple present – which held near 20 percent between 1850 and 1950 – has risen to over 50 percent in 2010, and continues its upward trajectory.

Nor is it simply the case that young adults are just trading marriage for cohabitation. To be sure, this is happening to some degree, but Ruggles notes that the share of 25-29 year olds without a co-residing partner has grown from 23 percent in 1970 to 48 percent in 2007 to 54 percent today. The fastest growing household type is single-person rather than cohabiting couples, as more and more adults of all ages who never married, are separated/divorced, and are widowed live alone.

If the household is the unit of both production and consumption, greater fragmentation and instability in household structures is troublesome. The primary household production good today is the next generation, and the U.S. appears to be following the lead of many European countries in developing fertility levels below replacement. Nothing that Ruggles presents in his paper provides comfort that the recent declining fertility rates are simply due to the lingering effects of the Great Recession and will likely reverse themselves.

One contributing factor to declining fertility may be trends in income. Households have always provided the mechanism for combining incomes. To Ruggles’ dismay, the evolving global economy is leaving more American households without secure incomes. The long slide in the relative earning power of young men over the past 40 years has been mitigated by the steady rise in employment of wives. But now that fewer and fewer households contain a married couple, and given that women’s real wages have also begun to decline, aggregate household incomes for married couples has begun to decline as well. Ruggles suggests that the largest source of decline in economic opportunity for young people, especially over the past two decades and in future decades, may be the automation of both manufacturing and services made possible by new technologies.

Housing consumption broadly should follow the downward trends in employment and income. Boosting household formation and homeownership rates, especially among the young, will require a reversal of many of the long-term demographic and economic trends that Ruggles discusses.

Ruggles’ article has sixteen figures, some only going back in time to 1940, but many spanning 150 or more years. I highly recommend you take a look. Some will surely make your jaw drop too.