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Thursday, October 27, 2011

Economic Recession Equals Migration Recession

In bad economic times people tend to go somewhere else, if they think that things are better in that somewhere else. If there isn't anyplace better, as seems to be true over the past few years, then people quite rationally just stay put. This latter trend is the hot-off-the-press conclusion from analyses of the just-released 2008-2010 American Community Survey survey data, as reported in today's New York Times.

The institute’s study [the Carsey Institute at the University of New Hampshire] compared three years’ worth of data from the Census Bureau’s American Community Survey, which was released early Thursday and covered 2008-10, with the data from 2005-7. Since the survey’s findings are released in three-year increments, this was the first time that researchers had a set of data that included only years since the financial collapse began, allowing them to make a direct comparison to a similar period before the collapse.
Using this and other data from the I.R.S. that many researchers consider even more comprehensive, they found that migration into formerly booming states like Arizona, Florida and Nevada began to slow as soon as the recession hit and continued to shrink even into 2010, when many demographers expected it to level off. At the same time, Massachusetts, New York and California, which had been hemorrhaging people for years, and continued to do so in the three years before the financial collapse, suddenly saw the domestic migration loss shrink by as much as 90 percent.
“When times get really hard it gets really hard for people to up and move,” said Kenneth M. Johnson, the senior demographer at the Carsey Institute, who conducted the analysis. “People who might have left New York for North Carolina are staying put. But that is a very recent change, so that places that had been growing rapidly suddenly aren’t, and the outflow has really slowed down.”
Mr. Johnson said that the same phenomenon could be seen within states, as the growth began to slow in once rapidly growing suburbs, and shrinking cities like Los Angeles and Chicago began to stabilize.
In an analysis of the American Community Survey data made public on Thursday, William Frey, a senior demographer at the Brookings Institution, found that large metropolitan areas with once-flourishing economies, like Atlanta, Phoenix and Riverside, Calif., are no longer magnets for Americans ages 25 to 34.Mr. Frey said that, in many ways, young people were staying in the more established cities with a kind of wait-and-see approach to the economy. He said he expected the relocation rates to pick up as soon as there were new housing and job opportunities for young adults.
“They are trying to bide their time in a hip place they know,” he said. “But there is going to be a pent-up demand for migration, because right now people are just putting their lives on hold.”
With any luck, we won't have an economic recovery based on a new unsustainable housing bubble, but when the economy does bounce back (and it will), we will know it by watching the moving vans roll down the street.

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