Millennial Preferences in the 2020s
More than 9/11 or the Great Recession, COVID-19 and the associated economic downturn will shape Millennial preferences for years to come. Their intensive use of virtual media necessitated by the health risks may become more ingrained. The counter narrative is that the social distancing imposed by the pandemic will increase their desire for face-to-face communication in the public realm. If the latter turns out to be the case, Millennial preferences for dense, diverse, connected urban places may actually increase. In these places, Millennials are able to fulfill their desire for speedy access to almost everything. In contrast, Gen Xers find fulfillment through the ownership of many things which requires larger residences available in suburbia.
If Millennial preferences are sustained, where will they choose to live, work, and move as they form larger households with growing children? There is no one answer since their financial situation and related factors will constrain their preferences.
Millennial households should continue to prefer the amenities and lifestyle central cities offer as long as they can secure good educational opportunities for their children. They will be attracted to collar neighborhoods near employment centers to gain more living space without losing much access to urban amenities. Those that are able to experience this lifestyle will be relatively affluent households enjoying the benefits of well-paying jobs plus some combination of minimal debt and the infusion of parental wealth. In general, the more affluent households will tend to locate in cities found in larger, more prosperous metropolitan areas.
Another significant portion of the Millennial cohort will have more limited means. These households should move to places where they can find affordable housing, decent schools, and reasonable employment opportunities. Attractive locations will tend to be smaller, less prosperous cities and associated suburban areas.
Given these scenarios, larger urban areas should continue to thrive as long as they embrace workforce housing for creative types and service workers. This infrastructure is as vital as structured parking that affords more density and fewer auto trips. Even places with relatively weak economies should hold their own if they offer affordable housing for the growing army of Millennial telecommuters. Another asset is the ability of these areas to attract Gen Z which is more likely to mirror the preferences of Gen Y (millennials) than Gen X which includes most of their parents.
The next tier of mid-sized and smaller cities in the urban hierarchy should have highly variable experiences. Affordable housing should be the common asset of these places. The more successful ones will tend to have good connectivity to large metropolitan areas, relatively vibrant (dense, diverse, connected) downtowns, decent public schools, and reasonable access to natural amenities. The remaining urban areas in this category should fare poorly.
The remainder of the space-economy includes most suburban, ex-urban, and rural areas. These places may only offer cheap housing which should be attractive to the least affluent households, including some Boomers, the youngest of whom will be in their 60s. The few places with a strong economic base in agriculture/primary products should hold their own. But the large majority is likely to decline.
Several counter arguments to these posited spatial outcomes deserve to be mentioned. In the first place, not all Millennials prefer urban areas even if they can afford them. Some will choose to locate in suburbia including those living with or near their parents or older relatives. Second, the impact of autonomous vehicles is highly uncertain. Whether they will generate centripetal or centrifugal forces is far from clear. Finally, economic inequality has been growing both regionally and socially. Its corrosive impacts represent an ominous source of social disruption and reactionary politics that could impact how and where we live, work, and move.