The document discusses living standards in Britain across generations. While there are some reasons for optimism around pay growth and home ownership rates for younger generations, headwinds remain. Younger adults face pay and occupational scars from the financial crisis and structural factors that leave their pay behind predecessors. They also face a consumption crunch and declining home ownership prospects due to high house prices. While policymakers aim to support both the old and young, challenges remain in balancing support for an aging population projected to cost £36 billion by 2030 with improving living standards for younger cohorts.

1. 1
A generational lens on living
standards in Britain today
Laura Gardiner, Resolution Foundation
@resfoundation

2. 2
Reason for optimism 1: The strongest two years of pay
growth for under 30s
Change in median real hourly employee pay (CPIH-adjusted), by age group: GB, 2016-18
@resfoundationSource: RF analysis of ONS, Annual Survey of Hours and Earnings

3. 3
Reason for optimism 2: A home ownership uptick for gen
X and millennials
Home ownership rates, by age and cohort: UK, 1961-2018
@resfoundationNotes: A family unit is a single adult or couple, and any dependent children. Source: RF analysis of IFS, Households Below Average Income (1961-83); ONS,
Annual Labour Force Survey (1984-91); ONS, Quarterly Labour Force Survey (1992-2018)

4. 4
Reason for optimism 2: A home ownership uptick for gen
X and millennials
Home ownership rates, by age and cohort: UK, 1961-2018
@resfoundationNotes: A family unit is a single adult or couple, and any dependent children. Source: RF analysis of IFS, Households Below Average Income (1961-83); ONS,
Annual Labour Force Survey (1984-91); ONS, Quarterly Labour Force Survey (1992-2018)

5. 5
Reason for optimism 3: Big cohort-on-cohort increases
in pension contribution rates
Occupational pension scheme membership among employees, by age, and cohort: UK, 1998-2018
@resfoundationNotes: Cohorts are approximate in the 22-29 age range, given it spans less than 10 years. Source: RF analysis of ONS, Annual Survey of Hours and Earnings

6. 6
Headwind 1: The crisis cohort carrying pay and
occupational scars with it into its 30s
Proportion of people in each educational cohort in employment in three lowest-paying
occupational groups, by years since leaving education: UK, 1992-2018
@resfoundationNotes: Occupations are categorised based on average hourly earnings. The three lowest-paying occupational groups are elementary occupations, sales and
customer service occupations and caring, leisure and other service occupations. Source: RF analysis of ONS, Quarterly Labour Force Survey

7. 7
…Combined with structural factors, this means that
young adults’ pay is behind predecessors at the same age
Median real hourly employee pay (CPIH-adjusted to 2018 prices), by age and cohort: GB,
1975-2018
@resfoundationNotes: A consistent CPIH series is available from 1989 onwards, which we project back to 1975 using changes in an estimated historic series of CPI inflation.
Source: RF analysis of ONS, New Earnings Survey (1975-97); ONS, Annual Survey of Hours and Earnings (1997-2018)

8. 8
Headwind 2: A 21st century consumption crunch for
young and prime-age adults
Median real equivalised weekly non-housing household consumption (CPIH-adjusted to 2017-18
prices), by age group: UK
@resfoundationNotes: Consumption in each detailed spending category in each year is reweighted to match figures from the National Accounts (on a per-household, per-week
basis), in order to correct for growing under-recording of consumption expenditure in surveys. Source: RF analysis of ONS, Living Costs & Food Survey

9. 9
…With more of that smaller spending envelope devoted
to essentials, too
Proportion of equivalised non-housing household consumption in each spending category, by age
group: UK
@resfoundationNotes: We present trends in consumption for each individual, rather than just for the head of the household. Unlike our other analysis of consumption, this
figure is derived from raw survey-based consumption data. Source: RF analysis of ONS, Living Costs & Food Survey

10. 10
Headwind 3: Huge house price increases meaning youth
home ownership declines are unlikely to be reversed
House price index (January 2015=100): GB/UK
@resfoundationNotes: Composite measure derived from a combination of different sources. Corresponds to the UKHPI series from 2005 onwards. Source: Bank of England,
Three Centuries of Data

11. 11
…Leaving those too young to benefit from the property
wealth boom far behind predecessors
Mean real family net property wealth per adult (CPIH-adjusted to 2018-19 prices),
by age and cohort: GB, 1993-2017
@resfoundation
Notes: Trends observed in the British Household Panel Survey and Understanding Society are used to index those observed in the Wealth and Assets Survey
backwards and forwards. Source: RF analysis of ISER, British Household Panel Survey (1993-2007) / Understanding Society (2015-17); ONS, Wealth and Assets
Survey (2006-16)

12. 12
Reason to look deeper 1: Rapid participation shifts due
to a rising state pension age
Female participation rate, by age and single-year birth cohort: UK, 2007-18
@resfoundationSource: RF analysis of ONS, Quarterly Labour Force Survey

13. 13
Reason to look deeper 2: High and enduring relative
poverty rates for older private renters
Proportion of people in the private-rented sector in relative poverty (after housing costs),
by age and generation: UK, 1961-2017
@resfoundationNotes: Data for 1992 and 1993 have been interpolated. Northern Ireland data is missing for 1994-2001. Source: RF analysis of IFS, Households Below Average
Income (1961-91); DWP, Family Resources Survey (1994-2017)

14. 14
Reason to look deeper 3: Huge wealth gaps between
men and women in the cohorts that have done best
Median real individual total net wealth (CPIH-adjusted to 2018-19 prices), by age,
cohort and sex: GB, 2006-16
@resfoundationNotes: Unlike most of our analysis of wealth, in which we share all components of wealth equally between adults in the family unit, here men and women in
couples are assigned their individual pension and financial wealth. Source: RF analysis of ONS, Wealth and Assets Survey

15. @resfoundation
• Some recent good news in terms of young adults’ living
standards…
• …But headwinds remain
• Twin aims for policy makers:
• Support and care for the old, particularly the least well-off,
costing £36 billion by 2030
• The promise of cohort-on-cohort living standards progress for
those coming behind
15
A generation lens on living standards in Britain today:
Concluding thoughts

16. The project has been funded by the Nuffield Foundation, but the views expressed are those of the authors and not necessarily the Foundation. Visit www.nuffieldfoundation.org
June 19@resfoundation 16
A lifetime of living standards
Launch of the Intergenerational Centre, and inaugural
Intergenerational Audit
#generations
Wifi: 2QAG_Guest Password: Welcome_Guests
Bobby Duffy, Director of the Policy Institute at King's College, London
Abigail McKnight, Assoc. Director of the Centre for Analysis of Social Exclusion, LSE
Laura Gardiner, Research Director at the Resolution Foundation
(Chair) David Willetts, President of the Intergenerational Centre, Resolution Foundation