Why the typical NZ household is undergoing a revolution

by Shamubeel Eaqub / 23 April, 2019
shamubeel eaqub

Shamubeel Eaqub says the idea of a nuclear family, with two parents and kids, is in steady decline. Photo/Ken Downie.

Shamubeel Eaqub tracks the fast-transforming New Zealand household – what it looks like now and where it’s going.

How we live has transformed dramatically. In a way, there never was a typical way of living, but perceptions linger – built mostly around baby boomers’ memories of their 1950s and 60s childhoods in that post-war period of relative prosperity when Dad worked 40 hours a week, Mum stayed home to look after the children, and most people could afford a house on a full section, paid off by retirement. Now, social, economic and demographic factors are driving relentless change.

When the full 2018 Census data is eventually released sometime this year, it will show a remarkably different picture of New Zealand. We’re living in different places, having fewer kids, living longer and getting older, perhaps lonelier, and the idea of a family has become more fluid.

What’s a family, anyway?

The idea of a nuclear family, with two parents and kids, is in steady decline. Thirty years ago, four in 10 households were two-parent families. Today, it’s fewer than three in 10 – and many of those may be blended families, too. If you turned up at a home at random, the chances are almost equally likely you’d find either a two-parent family, someone living alone or a couple with no children. Single-parent families account for around 10% of households, with separations and divorce now commonplace as societal disapproval has largely disappeared.

Read more: Rethinking the Kiwi dream: How we live now

Extended families living together is rare, but has been increasing in recent years. Around three in 100 households hold two or more families, and five in 100 are what we might consider flatting. Some of it is cultural, some is driven by need.

We are an increasingly complex society, distinguished by geography, cultural change, economic change, policy change and unaffordable houses.

Changing geography

The starkest change is geographic. Our population is increasingly urban. Since the mid-1980s, New Zealand’s population has grown by 1.6 million people. Fewer than 100,000 of them are in rural areas; the rest live in urban centres – generously defined as any urban cluster, including townships like Rolleston.

The urban shift is longstanding and is largely driven by economic factors. People cluster around places that offer livelihoods, and our economy is increasingly centred on knowledge and services, which favours cities like Auckland, Wellington and Christchurch.

Many smaller urban areas have also grown, for varying reasons. Queenstown has expanded because of booming tourism and its role as a bolthole for the rich and famous; Palmerston North and Feilding have grown because of surprisingly good employment opportunities and affordable housing.

Auckland traffic woes, along with the cost of living, are pushing people to the regions. Photo/Getty.

Auckland traffic woes, along with the cost of living, are pushing people to the regions. Photo/Getty.

When the city becomes hostile

The housing supply and infrastructure haven’t kept up with the population growth of these towns; as a result, they have become increasingly hostile to their citizens. The cost of living, particularly housing, and congestion, are pushing people to neighbouring regions.

For example, more Aucklanders move to the regions than the city attracts from the rest of New Zealand. It’s not an exodus, rather a persistent and accelerating trickle.

Auckland is reliant on international migration to fuel its insatiable demand for workers, both skilled and unskilled. But this demand for immigration and population growth is not matched by housing and infrastructure.

When those residents experience unaffordable houses and clogged roads, sentiments on immigration and foreigners will eventually turn Trumpian. Economists’ arguments about the long-term benefits of immigration will fall on unsympathetic ears. This isn’t helped by New Zealand’s current unstructured immigration policy, which does not define how big we want the population to be or the why of population growth; nor does it invest for it.

Read more: Why people are ditching Wellington for Wairarapa

For now, Aucklanders are voting with their feet. Often, the city’s refugees end up in the neighbouring regions of Waikato, Bay of Plenty and Northland. That used to be largely retirees cashing up by selling expensive Auckland houses, moving out of the city, and funding their retirement on the proceeds. Now, it’s increasingly younger people, typically at the age of starting a family.

The other driver has been better jobs surfacing in the regions. As the populations of Hamilton and Tauranga have grown by more than 20% in the past decade, the types of jobs and incomes available have improved. Younger people can make a good living, access good schools for their children and enjoy a nice quality of life.

The downside? The popularity of the Bay of Plenty and Waikato regions has pushed up the cost of housing, forcing lower-waged families and individuals to look further afield.

Fewer children

We’re having fewer kids, we’re coupling up later, and separations and single-parent or blended families are more common. Fertility rates are dropping. For a woman born in 1984, the estimated fertility rate is 1.9 children. Her mother’s was 2.4 and her grandmother’s 3.5.

There are many reasons why women are having babies later – and fewer of them. They’re now more likely to get a tertiary education, accumulate student debt, join the workforce and perhaps fit in an OE before settling down with a partner and having children. And they are more likely than previous generations to have fulfilling careers, which can displace the space and desire for one or more children.

This means we are living for longer stretches in flats, alone or as a couple.

Declining fertility rates are common around the world. This is typically associated with rising incomes, which are accompanied by better education, access to contraception, better healthcare and so on. Among rich countries, fertility rates continue to drop. There’s less time to spend raising a larger family, even if we wanted one. In the US, according to the General Social Survey in 2016, women wanted more children (2.7) than they are likely to have (1.8).

Older mothers, too, are more common. In the 80s, fewer than 1% of 40-year-old women had a baby, now it is 3%. Rising birth rates among older women is likely helped by improving fertility technologies, but total fertility rates are still falling.

In high housing-cost areas, it is often necessary for both partners to work. This can determine family size, or motivate a move to a region with a lower cost of housing but good jobs and schools.

At the margins of what affects fertility, living in dense and small places also leads to fewer children, according to an analysis of UK and Finland families by Hill Kulu, a demographer at the University of St Andrews, Scotland. Couples will tend to move from apartments to larger homes before having a baby, while living in a larger home for longer increases the chances of a having a third child.

It seems couples seek the extra space to have babies, but may put it off or have fewer children if they can’t afford to buy a larger home.

Getting older

We are living longer, and the older population is growing. As people age, they live differently. Typically, it begins with the empty nest, as children grow up and leave. Unsurprisingly, people in their 50s, 60s and 70s are most likely to live as couples with no children.

In some cases, the nest is not emptying. Many young people are not off flatting at the first opportunity, but are instead staying at home while going to university, often motivated by the cost of housing. The average rent per bedroom is around $350 per week in central Auckland and $270 per week in Wellington city. No wonder the kids can’t take flight.

In Auckland, it is increasingly common to see adult children moving in with their parents for a while to save up a deposit for their own home. For some, that arrangement is more permanent, either out of necessity or cultural reasons.

Read more: Borrowing from the bank of mum and dad

Many older people are also likely to live alone: either because of separations, which are increasingly common among older couples, or because of death.

As people get older, they often downsize or move out. But this is less common than realised. Only around a quarter of over-60s moved to a new house in the last five years, and over half have lived at the same address for more than 10 years. Many people will stay in the community and keep the family home for sentimental reasons and the occasional visit from kids and grandkids.

Some people sell and move to a smaller home, or to a different region with a better climate or cheaper houses. A few move to retirement homes, which tend to be expensive.

How we live

How we live is constantly evolving. As the idea of a traditional nuclear family becomes less prominent, our mental image of a typical Kiwi family needs an update. The 2018 Census will probably show that couples without children make up the most common family unit, outnumbering the traditional mum, dad and the kids. By 2050, someone living alone will be as common as the traditional nuclear family.   

This article appeared as part of a feature on how New Zealanders live now.

Shamubeel Eaqub is an economist with Sense Partners, and the co-author with Selena Eaqub of Generation Rent (2015).

This article was first published in the March 2019 issue of North & South.

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