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It's a huge problem. I tried to help my kids grow up the way I did, hanging out in the neighborhood a lot with other kids, building forts in the woods, etc.
But I'll be honest - it wasn't that successful. Not that I wasn't kicking them out of the house enough, but...there was nobody else out there to play with! Seriously, all the other kids were either playing video games, or in after school sports, or some kind of after school enrichment. Very few - almost zero - kids were out there, willing and able to hang out and play.
You really have to be VERY deliberate with what kind of place you move into. Where we lived earlier was very tech oriented, and very international. And transient - nobody had grown up there.
That's the worst kind of neighborhood to grow up in, if you care about your kids being able to play with other kids, in person.
The kind of neighborhood to grow up in would be one where :
  • there's a lot of kids the same age
  • they're home-schooled
  • parents are not insanely career-focused
  • probably a more conservative area, more church oriented
Also - you gotta bite the bullet and just NOT ALLOW screen time except for very limited chunks, perhaps. And ideally convince the neighbors of the same. Yes, it's easier to park kids in front of a screen. But that's exactly how this problem is perpetuated. And kids nowadays really do have what seem to be very serious issues.
A family friend with 4 young kids moved away from a neighborhood that was kind of like my old neighborhood (very career oriented, no kids playing on the street).
They moved to a new development where there are lots of new families, and almost all of them home-school. Apparently the kids are out playing with their friends all the time, and are very happy. Very limited screen time. It's a big risk because this new place is way out in the country, 2 hours from his (remote) job. So, hope he's able to keep the job, because there's zero jobs out there. But then - the kids are doing great.
It's so sad now when you go to a restaurant where there are young kids. I'd say at least 80% of the kids are not interacting with anyone, nor drawing with the restaurant-provided coloring paper and crayons. Instead, they're watching a show on their tablet. Very, very sad and so unhealthy for the kids.