If you are an American, odds are you’re single. According to a new report from economist Edward Yardeni, more than half of Americans aren’t married, up from 37 percent in 1976. He reckons a nation of singletons will change the structure of the economy because it means fewer parents and homeowners. Whether this is good or bad depends: Single people can be more flexible, which means fewer economic distortions and a more dynamic labor market, but it might make the economy as a whole riskier.
For Yardeni’s purposes, anyone unmarried counts as single. But the potential economic benefits of singleness only confer to a specific type of single: someone who lives alone. Some married people live alone; many unmarried people live with their partners or children. A large share of the increase in singleness comes from more people living alone, but it’s also become more common for unmarried partners to live together.
According to the U.S. Census Bureau, the proportion of single-person households has increased from 17 percent to 27.5 percent. Most of the increase in people living alone comes from men. In the 1970s, a man on his own was pretty rare, making up only about 5 percent of households. Now such households account for more than 12 percent. Though the increase in single households isn’t as impressive as the increase in overall unmarrieds, it may have some profound effects on the economy.
There are economic benefits to having more singles in the workforce. Singles are less likely to own a home or have kids, and without those tethers, singles can be more mobile when it comes to their career, able to move or change jobs as the demand for labor shifts. Without a family to support, they may be more inclined to try entrepreneurship; without children, there are fewer fixed expenses and it’s easier to cut back if need be.
Single households also face more downside risks, or at least different ones. With a single source of income (and health insurance), single households are more sensitive to job loss, injury, or illness. Their ability to cut spending, while good for the personal balance sheet, could make the economy more sensitive on the whole. And fewer children means both fewer future taxpayers able to fund entitlement spending and potentially less of a safety net for singles as they age.
In a more competitive global economy, the trend toward more singles simply increases the stakes. A more flexible and responsive labor force could enable the American economy to grow more quickly and efficiently, but less stability (and fewer future taxpayers) could also mean a whole new kind of downside risk.