by Mark Mather, associate vice president, Domestic Programs
The Census Bureau released alternative U.S. population projections today, to supplement the “middle series” projections they released in December. The new projections are based on three immigration scenarios, or “variants,” each with different implications for growth:
Low immigration: Assumes that net international migration will range from 704,000 to 824,000 per year.
Constant immigration: Assumes immigration levels will remain at current levels (around 725,000 per year).
High immigration: Assumes immigration levels will range from 884,000 to 1.6 million per year.
Projections of the U.S. population, under each of these scenarios, are significantly lower than those produced by the Census Bureau just a few years ago. The Census Bureau’s “low immigration” series from 2009 projected that the U.S. population would reach 422.6 million by 2050. But the “high immigration” series released today projects a smaller U.S. population in 2050—just 415.7 million people—than the previous “low immigration” series (see table).
“Demography is changing the entire economic and strategic divisions of the world,” Goldstone told the room. “We’ve had a 15 year increase in life expectancy just in the last half century,” and today, “90 percent of children under 10 are growing up in developing countries.”
Many countries, said Goldstone, are caught in a difficult race between growth and governance, with governments struggling to provide services and opportunity to their growing populations. This challenge is especially acute in cities, which for the first time in human history are home to the majority of all people.
At the same time, aging is a phenomenon that will affect many developed countries. In the United Sates, the baby boomers are becoming “the grayest generation,” Goldstone said, and similar imbalances between the number of working age people and their dependent elders will soon affect Western Europe, Japan, Korea, Russia, and others.
by Mark Mather, associate vice president, Domestic Programs
Yesterday the Census Bureau released the first national data broken down by race and Hispanic origin from the 2010 Census. Here are some of the highlights:
Minorities are driving nearly all of the population growth in the United States and there are lots of states, including California and many states in the Northeast and Midwest that would be seeing population declines if it weren’t for minority population growth. Minorities make up more than one-third of the total U.S. population (36 percent, up from 31 percent in 2000).
It’s mostly Latinos who are driving this population change. Latinos now number more than 50 million. That’s more than double the Latino population in 1990 and a 43 percent increase since 2000. Latino population growth was most rapid in the South, where many states have seen their Latino populations double during the past 10 years.
We’re seeing these changes despite a drop in immigration levels during the recession, which reduced net immigration from Latin America. Even if you closed the borders to new immigrants, the Latino population would continue to grow because it’s a young population with a lot of momentum. Immigration has put the U.S. on a path to become “majority minority” in the coming decades.
There’s a growing demographic divide between older and younger generations. We have a large cohort of mostly white baby boomers—now reaching retirement ages—which stands in contrast to an increasingly racially/ethnically diverse younger generation. In fact, nearly half of all children under age 18 are now racial/ethnic minorities. In 10 states and Washington DC, the proportion of children who are minorities has already passed 50 percent (up from 5 states in 2000). About 1-in-6 U.S. residents are Latino, but for the population under age 18, the figure is about 1-in-4.
The multiracial population is increasing but still represents a small share of overall population (about 3 percent). Slight changes to the race question on the Census Bureau’s questionnaire may have dampened multiracial identification in 2010.
Population growth of Asian Americans matched that of Latinos since 2000, at 43 percent. The number of Asian Americans added to the population since 2000, at 4.4 million, exceeded the increase in African Americans (4.3 million).
Stay tuned for more information. In June, PRB will release a report with detailed national, state, and local trends based on our comprehensive review of the 2010 Census apportionment and redistricting data.
“Go West, young man” was a famous statement accredited to newspaper publisher Horace Greeley, although he always denied saying it. Whoever said it, young men (and women!) certainly took the advice. Looking back just to the middle of the last century, the Northeastern quadrant of the country certainly ruled.* A very large share of the population, 46 percent, was located there in 1950. Today, those states account for 33 percent of the population.
One sure sign of the predominance of the Northeast was the concentration of sports teams. All 16 Major League Baseball teams were located in the Northeast with New York boasting three and Boston, Chicago, Philadelphia, and St. Louis having two each. St. Louis is on the other side of the Misssissippi – just. And one of those teams even moved back east, the St. Louis Browns to become the Baltimore Orioles in 1954. The National Football League Distribution was similar, but, back then, baseball ruled. When the Brooklyn Dodgers moved to Los Angeles in 1958, the shockwaves remain in Brooklyn to this day; the New York Giants followed to San Francisco in the same year. It was probably no coincidence that coast to coast jet travel began the following year.
An advertisement from Coronet magazine, 1950. Text showing price difference in West and South is enlarged.
Another indicator of the Northeast’s hegemony shows up in advertisements which often had the line “prices slightly higher west of the Rockies” or just “in the West,” wherever that might be. The ad reproduced from a 1950 issue of Coronet magazine even tosses in the South! So, if you insisted in living in those places, well, you’re going to have to pay more to get them shipped from the Northeast. Today, of course, most things are made in China, which is actually west of the West.
Going back a bit further, the 1924 Presidential election gives eloquent testimony to the locus of population and power (see the Figure below). Notice that Vermont has one more electoral vote than Arizona. Today, the Phoenix metro area has 4.4 million population. In the 1920 Census, Phoenix had a population of 29,000. When I was visiting Frank Lloyd Wright’s complex of Taliesin West a few years back, the guide mentioned that he loved the remote location and that it was about a 1.5 hour or so dusty ride to “town.” Now, phalanxes of townhouses march right up to the gate in Scottsdale. Maricopa County, Phoenix’s location, is the fourth-largest county in population in the United States, behind only Cook (Chicago), Los Angeles, and Harris County, Texas (Houston). In that 1924 election, notice the complete reversal of politics as well. The “Solid South” was staunchly Democratic, just as the rest of the country was determined to be Republican. Not only are things now turned inside out East-West-wise but upside down, too.
1924 U.S. Electoral Map
*Northeast Region here defined as consisting of New England and the Middle Atlantic Divisions, the latter composed of New Jersey, New York, and Pennsylvania. To this is added the “East Midwest” Division, Ohio, Indiana, Illinois, Michigan, and Wisconsin. That grouping roughly corresponds to the rather unflattering moniker “Rustbelt.”
Back in 2000, some German politicians campaigned with the slogan Kinder Statt Inder (“Children instead of Indians”). Their point was that it would be better to address Germany’s growing labor force shortage resulting from its very low birth rate with more births rather than immigrants. But in August 2001, Germany began a rather unpopular “green card” program to admit 20,000 foreign computer specialists for a five-year period. The program was only modestly successful and, although expanded in 2004, hard times in the German computer industry further reduced its impact.
In the past few years, immigration of foreigners has dropped sharply (from a net immigration of 99,000 in 2007 to 27,504 in 2009) but has now rebounded sharply to 52,662 through May of 2010. All the better, according to a study conducted by Bernd Raffelhü, a renowned financial scientist at the University of Freiburg. The study is given prominent play in none other than the Frankfurter Allgemeine Zeitung (FAZ), one Germany’s most prestigious newspapers whose articles are much discussed. The title of the article Inder sind billiger als Kinder (“Indians are cheaper than children”) is an obvious play on the old anti-immigrant slogan. The study concluded that not only are immigrants being sought to fill technical positions in German industry but, throughout their lifetimes, they actually contribute more to government coffers than they take out. The German economics minister also stated that German companies are clamoring for workers.
Often, immigrants are portrayed as a burden on the state budget. The study concluded that that was true in the past but well-trained immigrants in higher paying fields make an immediate contribution through taxes and increase the size of the consumer market. Given their younger age than the workforce in general, such benefits can begin immediately. While it is true that some immigrants will take lower paying jobs that Germans themselves no longer want, an increased emphasis on skilled workers will fill many gaps. The study also recommended that immigrants and their children must integrate into German society, a point recently made by Chancellor Merkel, so that Germans do not feel that their country is becoming too multicultural.
The report is certain to ignite quite a debate. Recently, German banker Thilo Sarrazin ignited a firestorm with his racially charged anti-immigrant book “Germany Abolishes Itself” saying that immigrants are not assimilating well at all. The new study will certainly add flames to the fire, Meanwhile, the German birth remains essentially flat with little sign of an increase, so the demographic development that led to many of Germany’s current worries ticks on.
by Marlene Lee, senior research associate, Domestic Programs
In response to my earlier blog post on immigration and social security, researcher Dowell Myers makes the valuable point that considering immigration as a solution to the Social Security financing problem is not an “all or nothing” proposition. Immigration may be part of a solution, reducing the old-age dependency and helping to reduce the deficit of the Social Security program (see Social Security Advisory Board’s estimate of reduction). In his work, Myers estimates that feasible levels of immigration could reduce the old-age dependency ratio by 25 percent. Both Myers and Reich in their NPR interviews suggest that the policy solutions for Social Security should include immigration.
However, research suggests that increased immigration may have drawbacks for vulnerable populations that other policy options do not. George Borjas and other scholars provide evidence that immigration is most likely to hurt low-income workers. (For information on immigrant characteristics, see MPI report on immigrants and recession, and for a readable account of Borjas’ argument see NYT Magazine contributor Roger Lowenstein’s article “The Immigration Equation”) If one accepts the premise that immigrants reduce job opportunities for low-income workers, particularly visible minorities—a big if —then a solution that includes high levels of immigration might well affect the Social Security earnings of low-income and minority workers. This is because individuals’ eligibility for and level of Social Security benefits are tied to their earnings history.
Teasing out the effect of policy on different population groups is always difficult. And certainly many economists would argue that to the extent immigrant workers contribute to small business growth and spend their earnings in the United States, they may ultimately increase job opportunities. In any case, other policy options such as raising the Social Security payroll tax or changing the rules so that high earners pay Social Security taxes on all earnings, not just the first $106,800, do not disproportionately affect low-income workers. Also, let’s not forget that part of the equation for Social Security solvency is the labor force participation rate. Increases in women’s labor force participation rates had a positive impact on labor force growth, thereby increasing contributions paid into Social Security. Certainly even with the same old-age dependency ratio, if women’s labor force participation rates had not risen over the previous four decades, the Social Security financing gap would be larger. But these rates have stabilized, and the women who helped fuel economic growth will be among those collecting Social Security in the next 30 years.
A high rate of labor force participation among immigrants is one of the reasons that more immigration might work as part of the answer to the gap in Social Security funding. Higher labor force participation rates among native-born minorities also have the potential to increase growth of the labor force and future contributions to Social Security, just as increased female labor force participation did. But, this potential solution is not often mentioned in the current debate, perhaps because it is not perceived to be as easy to achieve as expanding immigration.
by Marlene Lee, senior research associate, Domestic Programs
This year, for the first time Social Security will take in less in taxes than is paid out in benefits. And by most estimates, the Social Security Trust Fund—designed to cover exactly this type of shortfall—will be exhausted around 2037. A few weeks ago, Robert Reich, Secretary of Labor under President Clinton and Professor of Public Policy at the University of California at Berkeley, proposed immigration as an easy answer to the Social Security funding crisis, or at least as one factor in the combination of steps needed to address this crisis. Reich says that increased immigration would likely have a greater impact than any other proposed measures, such as raising payroll taxes and the age of eligibility for social security benefits. His argument rests on immigrants’ younger age than non-immigrants and on his attributing the Social Security funding crisis to the decreasing number of workers per retiree. According to Reich, logically and simply, increasing the number of immigrants will increase the number of workers per retiree because young immigrants will work for decades to come.
Used under Creative Commons license from AFL-CIO.
But as many demographic studies suggest, the amount of immigration needed to produce the desired elderly dependency ratio (the retirement age population divided by the working age population) may not be desirable or achievable. In a PRB online discussion, Ronald Lee, a Berkeley economist and demographer, said he estimates that 395 million immigrants would be needed. UN estimates are even higher. Also, there is the question of how long it takes immigration to change a population’s age structure. Immigrants entering the United States will themselves age, some becoming eligible to participate in Social Security. Ken Johnson from the University of New Hampshire and Dan Lichter from Cornell University show that higher fertility among some immigrant groups fuels natural increase in areas where the population would otherwise have declined. But the impact of immigrant fertility on a population’s age structure takes a long time to manifest itself.
Finally, immigration may help close the financial gap in Social Security through its effect on economic growth. But economic growth depends on both the growth rate of labor and the growth rate of labor productivity. The effect of population aging on labor productivity is complex, particularly in an era of improved health among the older population and rapid technological progress. Historically, changes in the amount of capital available per worker as well as the pace of technology and the experience of the workforce have been the main factors that affect labor productivity. Alan Greenspan recently concluded, “…it is heightened growth of output per worker that presents the greatest potential to boost the growth of gross domestic product. A significant rise in the growth of labor productivity will be necessary if the standard of living of retirees is to be maintained and that of workers is to continue advancing.”
The effect of immigration on labor force growth seems pretty obvious, if not quite as simple as Reich argues, but its effect on labor productivity seems less obvious. Immigration’s effect on labor productivity would depend on the composition of the immigrant population. In the United States, the immigrant population includes both low-skilled and highly skilled workers, but the global competition for skilled workers has increased, keeping some potential skilled immigrants in their home countries or drawing them to countries other than the United States.
by Mark Mather, associate vice president, Domestic Programs
The population in America’s largest cities is booming, according to new data released today by the U.S. Census Bureau. Just a few years ago, the annual growth rate in the 10 largest cities was around 0.5 percent per year, around half the national average. But the latest figures, from 2008, indicate that the population in America’s 10 largest cities is growing faster than the population living outside of those areas.
(click on figure to view a larger version)
So what’s driving the change? There are a couple of factors at work. First, big cities are still important destinations for immigrants, who tend to be younger (of reproductive age) and create a lot of population momentum. Second, given the rising unemployment rate and drop in home prices around the country, fewer people are making long distance moves to places like Florida, or even local moves to the suburbs. Chicago, once a perennial population loser, is now growing faster than several former boom towns, including Jacksonville, Las Vegas, and even Cape Coral, Florida, which, a few years ago, was one of the fastest growing cities in the country.
The question for Chicagoans: How long can it last? When the economy bounces back, will people start leaving Chicago en masse? Population trends are closely linked to job trends so future population growth in big cities such as Chicago depends, in part, on their ability to keep people employed.
The Global Forum on Migration and Development, a global initiative within the framework of the UN General Assembly is having its annual meetings this week in Manila. This got me to thinking how global patterns of migration have changed and how they continue to change. A century or more ago, the big story would have been unfettered migration to that grand, nearly empty, continent, America. Hard economic times and famines drove many migrants from Germany, Ireland, Sweden, and the like. Anyone who could afford a ticket could become one of the newest Americans. That “escape valve” is no longer unregulated and migrating to the United States and Canada is no longer the free-for-all it once was.
After World war II, Europe began to have the American experience more and more, receiving increasing numbers of migrants from former or existing colonies or as “temporary” guest workers. Much of that was facilitated by the airplane. People used to note that planes to New York from San Juan came in full and went out empty. Now we see a rising tide of ‘south-south” migration. Just as the kinetic pull of higher wage rates pulls migrants from Mexico to the United States, so do migrants from Guatemala enter Mexico. So many Bangladeshis flood into India that India is once again planning a border fence.
Many national reactions to these streams of migrants have been schizophrenic at best. The UK seemed to have a liberal policy toward new EU migrants but now enthusiasm for non-English-speaking migrants is waning. There is now a debate about adopting an Australian style point system. With few exceptions, it seems that the world wants to move to a world without migration even if more hands and more workers paying taxes are actually needed. Maybe the population bomb has found its fuse.
