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Population Declining in States With Relatively High Dependence on Government

A Commentary by Michael Barone

Friday, January 17, 2014

The Census Bureau's holiday treat is its release of annual state population estimates, to be digested slowly in the new year.

The headline from this year's release is that population growth from July 2012 to July 2013 was 0.72 percent, lower than in the two preceding years and the lowest since the Great Depression 1930s.

This reflects continuing low, below-replacement-rate birth rates and lower immigration than in 1982-2007. Net immigration from Mexico evidently continues to be zero.

The nation's economy may be growing again, but Americans -- and potential Americans -- are not acting like it. There's a parallel here with poll results showing that majorities still believe we are in a recession that the National Bureau of Economic Research says ended in June 2009, nearly five years ago.

Sluggish population growth is matched by sluggish geographic mobility. The Census Bureau reports that only 4.8 million Americans moved across state lines in 2012 -- about half the percentage that did so in the boom years of the 1990s.

Americans were similarly immobile, indeed even more so, in the 1930s (the Okies fleeing the dust bowl for California were a picturesque but demographically minor exception).

Numbers can seem cold and impersonal, but beneath these numbers is a picture of a pessimistic, risk-averse people.

But not uniformly, and not everywhere. Population growth has been accelerating in states that depend heavily on the private sector and declining in states with relatively high dependence on government.

This reflects the wearing off of the effects of the big jump in government spending triggered by the 2009 stimulus package and a heartening, though limited, resurgence of the private sector as government spending has slowed.

Thus population growth has slowed, though remaining above the national average, in the District of Columbia (where it has surged through gentrification), Maryland and Virginia.

Growth rates have declined as well in other states with high levels of public sector and federal contract jobs -- New Mexico, Alaska, Mississippi.

But growth rates have increased significantly in most of the Midwest and Rocky Mountain heartland. That has been especially true in the nation's growth leader this decade, North Dakota, with its Bakken shale boom.

Growth has accelerated in Colorado, Arizona and Nevada, which are finally recovering from the collapse of their housing markets in 2007-10. Colorado and Arizona have been attracting migrants from other states, while Nevada's growth is fueled mostly by immigrants.

Growth has accelerated also, from a lower base, in almost all of the Midwest. It has risen to above-national-average rates not only in the Dakotas, but also in neighboring Nebraska and Minnesota.

In the industrial Great Lakes states, population growth has been strongest in Indiana, which created about one-tenth of the nation's new jobs in November, and it has risen from near zero or below zero in previously ailing Ohio and Michigan.

The straggler here is Illinois, burdened with a sharp tax increase and huge public sector pension obligations. Its immigration rate has fallen below the national average, and its domestic outmigration rate in 2010-12 (the latest numbers available) was higher than any other state but Rhode Island.

Illinois' 2012-13 growth rate was the fourth lowest of any state. Poor public policy has proven capable of sapping the amazing historic vitality of Chicagoland.

A vivid contrast is Texas, whose population grew 5.2 percent between 2010 and 2013, a higher percentage than anywhere else except much-tinier North Dakota and D.C.

With 8 percent of the nation's population in 2010, Texas produced 18 percent of its population growth in the next three years. That has largely been the result of relatively high birth rates and high domestic in-migration.

Immigration, running about the national average rate, has been a smaller factor, accounting for only one-sixth of the state's growth.

The shale boom has obviously helped Texas, but it's far from the sole cause of its strength. Its economy is highly diversified, to the point that it's gaining high-tech jobs from Silicon Valley.

From September 2007 to November 2013, while the nation lost 1.8 million jobs, Texas gained 1.1 million. Texas' public policies -- low taxes, light regulation -- have clearly paid off.

Most Texans tell pollsters they're distressed about the direction of the nation -- understandably, since the Obama administration's policies are so different from their own.

But Texas's demographic numbers suggest that traditional American optimism and willingness to take risks are not altogether dead. They're alive and thriving just north of the Rio Grande.

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