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Connections Issue 2

The Generation Game

Words By: Joanne Hart, Investments Editor at the Mail on Sunday
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Differences of opinion between young and old have existed since time immemorial. But in recent years, the disconnect between the two has intensified, to the detriment of both age groups. Now, creative thinkers are working to bring the generations closer together. Joanne Hart, Investments Editor at the Mail on Sunday, reveals how.

The tiny hamlet of Nagoro in Japan has become a poignant case study of what happens when young and old drift apart. As the town’s youth have migrated to the metropolis, the remaining elderly residents have filled the void with life-sized dolls of children and working adults. These eerie mannequins, which sit in empty classrooms or wait at bus stops, now outnumber the living residents by more than four to one. 

This may be an extreme case of generational estrangement. But there are worrying signs of intergenerational dislocation in the UK, Europe and North America too. Just as rich and poor often live at arm’s length, there is mounting evidence of age-based clustering. Competition between the generations for economic opportunities and government resources also appears to be heating up.   

Out of focus 

“Some of the ties of common interest that connect young and old have been fraying,” warns Paul Kershaw, a professor of population and public health at the University of British Columbia, and founder of Generation Squeeze, which aims to provide a political voice for the young. “The economy has been eroding under the feet of those in their 20s, 30s and early 40s, while governments have focused primarily on the needs of an ageing population.” 

On the other hand, older workers often feel that professional opportunities close off as they age, despite the fact that they are healthier for longer and want to remain economically active. 

Under stress

The most obvious source of tension has been economic.

 “Millennials have been hit by a triple blow from stagnant wages, surging education debt and soaring house prices,” says Liz Emerson of the Intergenerational Foundation, a London-based think tank. “That means younger workers have had to set their financial sights much lower than their parents or grandparents”. 

Evidence of financial stress abounds. On average, UK households headed by people in their 20s now spend 45% of their total budgets on the basics of housing, food, power and transport, according to data from the Intergenerational Foundation. In 1990, youth unemployment was about one-third lower than the national average; now it is roughly one quarter higher. 

This financial strain is far from unique to the UK. In Canada the average wage for people between the ages of 25 and 34 has fallen by $4,000, or 9%, since 1976. That’s despite the fact that around two-thirds of this age group are university graduates, versus less than a third in their parents’ generation. At the same time, the cost of education has been rising across the English-speaking world. A typical student in Britain will leave university with more than £44,000 in debt, according to the Sutton Trust. That is up from an average of £16,200 for those who graduated five years earlier. 

The goal for home ownership seems increasingly out of reach as well. In the decade to 2016 house prices in London, for example, have more than doubled in value, while prices in other parts of the country have also outpaced wage growth. That helps to explain why the percentage of 25 to 29 year olds owning their home has dropped from 55% in 1996 to 30% in 2015. 

"A quarter of young people between 20 and 34 are still living with their parents — 3.3 million in total, or 25 per cent more than in 1996".

Squeezed together

“We can certainly see this as ‘generation squeeze’. The age at which young people can achieve economic independence is being pushed further back,” says Professor Kershaw.  

One effect, ironically, has been that children are now living under the same roof for longer. UK government figures show that about a quarter of young people between 20 and 34 are still living with their parents – 3.3 million in total, or 25% more than in 1996. “Many children simply can’t afford to move out,” says George Lee, co-founder of The Age of No Retirement. 

With salaries under pressure, young parents frequently have to work longer hours, increasing the burden on grandparents to provide free childcare. One in three parents in the UK now rely on their parents to take care of children, according to the charity Grandparents Plus. And 19% of working parents say they would have to give up work without this help – roughly 2 million people. It has also been more common for young parents to be forced to return to the family nest, with children in tow. The number of ‘three generation’ households is on the rise, especially since the 2008 recession. There is evidence that this is related to economic necessity rather than choice. In the UK, for example, 21% of those with incomes in the lowest quintile live with grandparents and children, versus just 3% for those in the top income quintile, according to a recent paper in the journal Demographic Research. 

But while families are often being forced to co-habit for longer, segregation between those generations who are not related by blood appears to be on the rise. 

Drifting apart

“The population of the countryside is ageing a lot faster than the cities,” explains David Kingman, a senior researcher at the Intergenerational Foundation. “And even within cities there is an increasing geographic separation between young and old neighbourhoods.” 

Between 1991 and 2014, the median age of rural areas rose almost twice as rapidly as the median age of urban ones. One side effect of this is that the connection between young and old is weakening. A recent survey by the Social Integration Commission of over 4,000 people in the UK found that they had 42% fewer social interactions with people of different generations than would have been expected if their friends and contacts were evenly distributed across the age range. That rose to 54% if family members were excluded. 

“This has the potential to undermine trust and solidarity between generations,” explains Kingman. “With greater separation, both young and old become more susceptible to negative stereotypes about each other, especially when there is intensifying competition for limited public and private resources.” 

It’s not fair 

Some commentators are concerned that more politically engaged retirees have been claiming more than their share of government resources. In the UK, for example, there has been a 73% real-terms increase in the average state pension spend per head since 1985. “The principle of universal benefits has remained for those over 65 but has been chipped away for the rest of the population,” says Liz Emerson. “In the UK there has been a systematic reduction of benefits aimed at protecting those under 25 years old.” 

The injustice is far from one-sided, argues Lee at The Age of No Retirement. More mature workers are still facing discrimination. 

“On the day people turn 50 something very distressing happens; almost overnight they are often seen as over the hill by many employers,” she argues. “There is still this narrative of decay, and career advancement can stop dead.” 

Rivalry and mistrust between generations bubbled to the surface following the UK vote to leave the European Union, which many media commentators blamed on elderly patriots. While evidence is mixed, one survey showed that 21% of people below the age of 26 voted for Brexit compared with 69% of people over the age of 65.

Seeking solutions

This raises the question of what can be done to strengthen and sustain connections between young and old. Promising solutions range from changes in tax and planning policies to more grassroots interventions to bring generations together. 

One idea that has been spreading fast is shared accommodation for people at both ends of the age spectrum. Nursing homes from the Netherlands, France and the US have been experimenting with offering vacant rooms or apartments to struggling students – providing free or low-cost housing for the young in return for keeping elderly residents company. A notable success story has been the deal struck between the Judson retirement home in Cleveland and the nearby Cleveland Institute of Music. Budding musicians earn their keep by performing for retirees. At the Humanitas retirement home in Deventer, Netherlands, students watch sports, celebrate birthdays and chat to seniors. Such schemes have fostered deep friendships across generations and bridged the widening gap between young and old. 

The workplace offers another opportunity for intergenerational rapprochement, says Lee. 

“Barclays has been something of a role model in this regard,” she says. “Their employee base now spans five generations, with 35 members of staff over the age of 75. They have understood that their clients range from young to old and so should their employees.” 

“Nursing homes have been offering vacant rooms or apartments to struggling students – providing free or low-cost housing for the young in return for keeping elderly residents company”.

Back to work

Of course 35 employees is not many for a company as large as Barclays. But it is a start. Under the bank’s ‘Bolder Apprentice’ scheme, more mature workers are offered a chance to retrain. According to research from the bank, nearly half of 50-somethings in the UK who have taken time out of the workplace would like to return, but one third of those believe their age is a barrier. 

Lee also believes a change in the way companies design and market products has the potential to bring the generations together. “A lot of goods and services are targeted at a particular age group,” she says. “That means young and old often use different brands.” The Age of No Retirement has been working to formulate principles for ‘age-blind’ product design. 

Alongside such approaches, some experts contend that government housing policies are a key part of the solution. Part of the reason young and old are living farther apart, the Intergenerational Foundation suggests, is because it is so complicated to split houses into separate units. Many older people would like to downsize in retirement but the legalities are complex so they continue to live in properties that are far larger than their needs. 

“An enormous amount of new housing units could be unlocked by making it easier for people in large homes to sub-divide them without having to get planning permission,” the Foundation argues.

Under such a scenario, city planners could aim for more mixed-age communities, by including a wider mix of housing types and tenures. The power of local residents to block more inclusive housing developments, which was strengthened by the UK Localism Act 2011, could also be rolled back. “We could start to see more age-eclectic communities if this veto is relaxed,” says Emerson. 

If pressed, most people would acknowledge that old and young have much to learn from each other. The connection between the generations maybe eroding, but it is far from beyond repair.

This article appeared in Issue 2 - Connections

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