Poverty and living arrangements among youth in Spain, 1980-2005

Abstract

Abstract One of the most relevant demographic events in Spain from a recent historical perspective was the baby boom of the 1960s and 1970s. The adapting to of these generations of youth and their families through delayed emancipation and childbearing has been key in preventing a decline in their economic status. The results show that the reduction of the poverty risk among non-emancipated youth for the period 1980-2005 is explained by the fact that an increasing number of young Spaniards live with two employed parents. Thus, emancipation delay is found most in those families that can best afford it. Furthermore, the salaries of young workers remaining in the parental home have become an important factor in reducing their family poverty risk. On the other hand, fertility decline is readily explained by the economic difficulties young couples encounter in sustaining their offspring. (ProQuest: ... denotes formulae omitted.) 1. Introduction Individuals born in Spain during the 1960s and 1970s make up the so-called 'baby boom generations' which are characterised by being much more numerous than previous and subsequent cohorts. These generations have grown up in social, political and economic conditions completely different from those of their parents' youth. Though it is true that the baby boomers' situation improved in many senses following the Franco dictatorship, one should not ignore the worsening conditions of youth labour markets, the increased demand for education and the difficulties accessing housing that young people have had to face during last two decades. Facing adverse economic conditions, Spanish youth have turned to their families in search of financial protection. Young people have dealt with temporary contracts, high turnover in the labour market, unemployment, protracted education, and housing costs by delaying residential emancipation from the parental home. In fact, the percentage of young Spaniards living with their progenitors between 1980 and 2000 increased by more than 8 percentage points for the 20-24 age group and by 21 points for those 25-29, reaching cohabitation levels far higher than in any other country of the European Union-15, except Italy.2 The adapting to of both young individuals and their families by consenting to co-residence has acquired a crucial role in the provision of a safety net for household members.3 Traditionally strong family ties between young adults and parents, far from weakening, have been reinforced in Spain in recent decades as financial dependency on the family has strengthened.4 While most of the literature has been aimed at explaining the causes of demographic change, in this paper we are interested in its economic consequences as measured by the poverty risk. The main purpose of this paper is to study the ways in which Spanish families have coped economically with the emancipation delay of their young members in the period between 1980 and 2005. At the same time, we are interested in the economic circumstances experienced by young people living outside the parental home and how they relate to the fertility decline observed in Spain during the period. Data is from the Family Expenditure Surveys for 1980-81 and 1990-91, the extended sample of the 7th wave of the European Community Household Panel (ECHP) survey in 2000 and the 3rd wave of the Spanish component of the EU Survey on Income and Living Conditions (EU-SILC) run in 2006. Our empirical results are based on a Heckman selection probit model. The main findings show that emancipation delay is not associated with an increased poverty risk to Spanish families, thanks on one hand to the fact that a growing number of young individuals live with two employed parents, and on the other, to the fact that a growing number of co-residing youth are at work. Conversely, the poverty risk of young individuals living outside the parental home worsens greatly during the period due to aggravated economic circumstances experienced by young people engaged in childbearing. …