It’s been widely thought that Millennials didn’t want to own cars and, instead, preferred riding bikes and taking public transport because they were frugal and environmentally aware.
But a new study offers data showing that Millennials now are buying and driving cars in droves. It was the recession, not a lifestyle choice, that kept them from getting wheels.
Millennials entered the workforce when jobs were scarce and wages were low; they had less money and poorer credit prospects than their parents. Now that the economy has rebounded, so has Millennials’ love for having a car.
In a recent analysis titled “Are Millennials Different?”, three members of the U.S. Federal Reserve Board of Governors looked at Millennials’ buying habits and behavior. They found that car sales to young households dropped during the recession, but that spending on new and used vehicles falls into line with that of previous generations at the same time in life.
In a 2019 paper, economists at Resources for the Future, a nonprofit think tank, measured the miles Americans drove against gas prices and economic conditions.
In the paper, three economists fed household-level microdata into a computer model from the early 2000’s to see the relationship between economic factors and miles driven. Then they used the data and the model to test whether the drop in driving during the recession was due to economic straits or a dawning generational awareness.
They found that economic factors won out: Millennials are not only buying cars but also driving them with abandon. TJ
Environmentalists who have been counting on enlightened Millennials to shift the world’s pattern of vehicle buying and fuel consumption have to think again. It’s likely to be economic factors, not social conscience, that alters the world’s relationship with vehicles.