Monday, May 24, 2010

Recession ages the labor force

The sour economy may have discouraged many job seekers into giving up the job hunt for now, but that is not the case for those age 55 and older. While labor force participation rates have fallen across most age groups, rates have actually increased for those age 55 and older. In fact, even with higher unemployment rates, the total number of U.S. workers age 55 and older has actually increased in the past two years, while those age 16-19 have suffered the greatest employment losses.

It is worth noting, however, that working at older ages is not an entirely new trend in the United States. In the 1960s and early 1970s the majority of men age 55 and older were in the workforce. That proportion did not dip below 50 percent until 1975, reached its bottom in 1993, and has been increasing since that time. According to data released by the U.S. Bureau of Labor Statistics labor force participation in 1993 was 29 percent for men and women age 55 and older. That figure has risen to more than 40 percent today.

This trend toward longer work-life is driven by longer life expectancy, less secure retirement, and also by job satisfaction. Surveys of the population in Japan, with some of the world's highest rates of labor force participation in older populations, report that half of workers age 60 to 69 reported staying in the workforce because "working is conducive to improved health." This may be more true in today's knowledge-based economy than ever before, as working provides social connections that may fade in retirement.

Nevertheless, older workers tend to earn less than their younger counterparts. For example, workers age 65 and older make, on average, $90 less per week than those in other age groups.

With the aging of the Baby Boom population leading to rapid growth in the oldest age groups, coupled with higher rates of labor force participation, the United States can expect considerable competition in the job market for the foreseeable future. On the positive side, a higher rate of labor force participation means that companies may have an easier time retaining a workforce with many years of experience. Older workers, on the other hand, will need to keep skills sharp in order to overcome the wage gap.

Wednesday, May 12, 2010

Demographic Trends in San Diego: What Planners Can Expect in 2010

... article originally appeared in The Planning Journal, Spring 2010

Population Growth 1910-2010
In the past 100 years, the San Diego Region (18 cities and unincorporated county) has grown from a small city of 60,000 people to a thriving metropolitan area of 3 million. In San Diego’s early years, Census figures show that the county’s population nearly doubled every ten years from 1910 to 1960. Between 1960 and 1990 growth slowed to an average increase of approximately 33 percent every ten years. Growth slowed again in the 1990s, with increases averaging less than 15 percent in each of the past two decades.

Migration Patterns
Migration was the primary driver of population growth in San Diego’s early years. Historically, most growth in Southern California was a result of in-migration from other parts of the United States and from other countries around the world. However, according to a recent study released by the University of Southern California Population Dynamics Research Group, that trend has shifted statewide, with most of the population now being, in the words of the study authors, “homegrown” (i.e. born in California). San Diego, however, lags behind the state in this trend, with 52 percent of residents having been born outside of California, according to 2008 data from the American Community Survey.

The 2010 Census short-form does not include a question about place of birth or place of residence five years ago, as prior long-form survey questionnaires did. However, information on 2010 population characteristics provides concrete data against which migration trends can be measured. For example, knowing the 2000 Census population characteristics of a region, and the survival rate and fertility rate of the population, demographers can determine what the population in 2010 could look like in the absence of any migration. Comparing that 2010 hypothetical projection against actual 2010 Census data provides useful insights into which groups moved into or out of a community during the decade. Thus, the 2010 Census population data will provide a key benchmark for measuring migration trends.

With respect to local planning, the key point to note in migration trends is that "the future is us." The people we are planning for are ourselves, our neighbors, and our children. The years of double-digit population growth due to large in-flows of migrants appear to be over, at least for now.

Age StructureThe median age in San Diego increased from 31 years in 1990 to 33 years in 2000 and is estimated to be 35 years in 2009. 2010 Census data will likely show a median age in the mid-30s. While this may not sound like much of a change, the underlying age structure changes are dramatic. Between 1990 and 2000 the county's young population (residents under age 18) grew by 112,700, compared with population growth of only 40,600 in the population age 65 and older. This means that there were nearly three additional children in the county for every additional senior during the 1990s. In the ten years since the 2000 Census all indicators point to a reversal of that trend, with slightly more growth in the senior population than in the population under age 18.

The population is growing across all age groups, but this trend toward an aging population is here to stay. An aging population will result in changing needs and preferences for the local population. For example, older residents may have different residential structure type preferences than college students or families with children. With respect to transportation planning, traffic patterns may change as a result of more off-peak travel by retired residents. These are just a few specific examples of a much broader issue. Planners should be aware of their community's aging population needs as they update public facilities plans, transportation plans, zoning ordinances, and other plans.

2010 and Beyond
The demographic characteristics of the San Diego Region will continue to evolve over time. San Diego is transitioning from a history of high-volume in-migration, to a more “homegrown” population. The future we plan for is our own. Each generation of residents living here today enjoys longer life expectancy Longer life expectancy means that much of the region’s future population growth will be in the oldest age groups. The 2010 Census will provide a clear snapshot of the region’s changing demographic characteristics and will provide planners with plenty of food for thought for the decade ahead.