New research shows in the starkest terms yet how younger people were much more seriously affected by the property crash and resultant recession than older age groups.

A paper published yesterday by Petra Gerlach-Kristen of the Economic and Social Research Institute finds that those aged under 45 suffered far more than older age groups in terms of unemployment, disposable income, weekly spending, mortgage arrears and negative equity in the five years to 2009/10.

The single biggest difference between the two groups over the period is in weekly spending when housing costs, such as mortgage repayments and rents, are excluded.

Under-45 households recorded average weekly falls in non-housing spending of 32 per cent over the five year period, while those aged 45 plus spent 24 per cent more.

Underpinning the changes in weekly spending were changes in incomes.

Real incomes
Those aged under 45 on average suffered a 14 per cent fall in their real incomes between 2004/05 and 2009/10, while those aged 45 plus enjoyed an increase of 41 per cent, according to the research based on data from the Central Statistics Office. Among the reasons for such a difference in income and consumption patterns was the very different impact the jobs crisis had on younger and older people.

In 2009/10, the unemployment rate among single people under 45 stood at 14.2 per cent, while it was much lower – at 5.6 per cent – for singles aged 45 and older.

There were similar differences in unemployment rates among households with two adults.

As economists usually consider an unemployment rate of 4 per cent to be consistent with full employment, the new research suggests that older adults were little affected by the crash in terms of joblessness.

The difference between the age groups is also marked in terms of mortgage arrears. According to Prof Gerlach-Kirsten’s research, 6 per cent of 24- to 44-year-old households with a mortgage were in arrears in 2009/10. The rate was half that for those aged 45 and older.

Negative equity was the final metric analysed in the paper. It finds that among those aged 50 plus very few had mortgage debts exceeding the value of their homes in 2009/10.

At the other extreme, almost half of under 30s were in negative equity. One in three in the 30-39 age grouping were in that position.