New Millennial Renters More Likely to be in STEAM Occupations
Small asset multifamily continues to support a broad range of Millennial workers, while those in Science, Technology, Engineering, Arts/Design and Math (STEAM) occupations are renting at a faster clip.
Millennial Occupational Profile
Millennial apartment renters at the beginning of their careers are earning as much as their older neighbors living in similar rental unit/lifestyle configurations, as noted in our recent blog.
Broadly, this phenomenon is a self-selection process where young adults living independently in relatively more expensive downtown and downtown-adjacent apartment properties are also more likely to be employed in higher-skilled jobs with commensurate higher income levels.
Additionally, with high-skill jobs most concentrated in downtown locations, the more expensive, large apartment buildings capture higher shares of such workers compared to the more dispersed small apartment properties.
As shown below, 25% of all Millennials renting in small asset multifamily in 2016 worked in STEAM vocations, slightly higher than the overall 22% share of the Millennial population¹.
(Please click around for detailed chart information)
At the same time, small apartment buildings support a wide range of jobs. The lower-skilled local services, sales, and office support occupations formed the single largest Millennial renter group, with a share of 44%.
In sharp contrast, an impressive 37% of all Millennial renters in downtown-located, large asset multifamily were employed in STEAM occupations, equal in share to those in local services, sales, and office support occupations.
STEAM Occupations Growing across Apartments
Despite this recent trend, rising rents gripping most major US cities are pushing Millennial STEAM workers outward to less-expensive, downtown-adjacent locations, as observed in the renter growth trends for small apartment properties.
As shown below, Millennial renters in STEAM occupations increased their share in small asset multifamily by 2.6 percentage points over 2014-16, which is higher compared to the overall population share increase of 2.3 percentage points. Over the same period, large asset multifamily continued to rapidly skew towards STEAM jobs, with a 3-percentage-point increase.
(Please click around for detailed chart information)
As the U.S. economy continues its steady transformation toward high-skilled jobs, Millennials seem most adept at seizing emerging opportunities. Due to their location within metro economies, apartment properties are best positioned to gain from this burgeoning skilled labor profile demand.
1 All data is sourced from the American Community Survey (ACS), unless otherwise stated. ACS statistics are sample-based estimates of the compositional profile of the total population in the given year of data collection, and include a margin of error.