Millennials, eh? They never stand still. Always on the move, with their ‘portfolio careers’, side hustles in the gig economy, and no loyalty to the companies they work for. With an attitude like that, it’s no wonder they struggle to find decent work and pay.
There’s only one problem with this common trope though. It’s not true. Well apart from the struggle for decent pay – millennials who left education during the crisis are still feeling the effects in their pay packets and career prospects today.
In fact, young people today are moving jobs less than they were 20 years ago, and they’re even less likely to move areas to take up a new role. Resolution Foundation analysis of official labour market statistics finds that just 18,000 young people started a new job and moved home last year, compared to 30,000 in 1997.
But why does this matter? Because moving area for a new job is often a fast-track to better pay and career progression. The typical pay rise for someone moving job and home is over three times higher than someone staying put with their current employer. After all, the upheaval of moving has to be worth it financially.
The fact that millennials are less mobile today than previous generations is particularly surprising given that they are more likely to have gone to university, often a prompt for moving around. Moreover, more young people today are also more likely to live in the private rented sector, rather than owning their home. This tenure might be insecure and often poor quality, but its redeeming feature is supposed to be the ease it affords tenants to switch homes.
So why are millennials moving around less? There may be welcome reasons for this. For a start, record levels of employment across Britain mean that there are now more jobs in areas that used to be regarded as real blackspots. People may feel less of a need to move if there are more opportunities closer to home.
Second, the introduction of the National Minimum Wage in the late 1990s has closed the gap in earnings between areas, again reducing the relative ‘pull’ to up sticks to higher paying places.
But as our new research shows, there are more worrying reasons why young people (and older generations for that matter) are moving around less. While moving from a low-earning part of the country to a high-earning of the country can still boost your pay packet, a far greater share of that financial gain is simply swallowed up in rent today than it was in 1997 – often leaving you no better off overall.
For example, moving from Telford to Birmingham in 1997 would have meant a 14 per cent financial gain after housing costs were deducted. Today, that same move would leave someone worse off. Moving from Scarborough to Leeds made one 29 per cent better off in 1997; today it would only mean a 4 per cent uplift in after-rents earnings.
Not only is Britain’s housing crisis cutting into people’s disposable incomes, then, it’s also acting as an obstacle to moving around and leveraging careers. This is not just a problem for individuals, it’s an issue for businesses too. Lower job mobility makes it harder for firms to fill skills gaps and recruit the staff they need, particularly in areas such as London, Bristol and Manchester where private rents are so high.
The stereotype of millennials being footloose is wide of the mark. But it would help workers, firms and the wider economy if it were more the case. Sorting that means action to ensure that housing costs are less of a living standards burden than they currently are.
This article originally appeared in the i paper