Generation of Renters

Chicago has become a prime destination for Millennials. A recent Redfin study found that of the 20 ZIP codes in the nation with the highest percentage of Millennials with a college degree, seven are in Chicago. Several factors are at play, including relatively low home prices and rent; the city’s walkability and public transit options; and its emerging tech sector. Over the past decade, more than 16,000 information technology and computer-related jobs have been created in Illinois, according to the Illinois Science and Technology Coalition. Of those positions, about two-thirds are located in Chicago. They include application and software developers, systems analysts and programmers. An additional 21,795 jobs have been created in computer and Internet-related publishing since 2004.

The tech growth has happened rapidly. According to a recent analysis by Crain’s Chicago Business, the number of technology jobs in the city grew by 19.3 percent between 2011 and 2013, the sixth-fastest rate in the country. About 12,000 tech jobs were added during that span, thanks to growth by companies such as Facebook, Yelp, Inc. and Salesforce.

Many of the Millennials attracted to those jobs continue to rent, rather than buy a home. To Hewings, the rental mindset is indicative of a generation that doesn’t place much emphasis on ownership or possessions.

“They’re not buying cars, they’re not buying bicycles; they’re renting everything,” Hewings says. “They’re putting significant upward pressure on rental prices, particularly in the central part of Chicago where they want to live, where they can enjoy all the amenities of living downtown.”

Consumer Confidence

The improved employment outlook, as well as boosts to the stock market, falling energy prices and an improved outlook for home values, have contributed to generally higher consumer confidence. However, recent fluctuations indicate that unease persists. The Conference Board’s Consumer Confidence Index hit 94.1 percent in October – the highest number in seven years. However, the number took a five point nosedive in November, dropping to 88.7 percent.

The decline was due to less optimism for the economy’s short-term outlook and more negativity regarding the present state of business conditions and the job market, according to the Conference Board. Fewer consumers reported that they expected their wages to increase in the months ahead, dropping slightly from 16.7 to 16.3 percent. They also showed less positive attitudes toward the state of the job market, with those expecting more jobs to be created in the coming months falling from 16 to 15 percent. The year-over-year gains remain positive, and the recent seven-year high indicates that consumer confidence is coming around, thanks in part to a steep decline in fuel costs in recent weeks and a lack of inflation.