President’s Corner: Demography and Destiny
by Marta Tienda
Demography was front-page news in January, as several media outlets reported that China’s population had begun to shrink. This development was no surprise to demographers who have tracked the historic fertility decline set in motion by restrictions on marriage and the infamous one-child policy that was enforced from 1980 to 2016. A predictable consequence of China’s past policy is its rapid population aging, but decades of below-replacement fertility may also slow economic growth as the size of its working-age population shrinks.
Contemporary U.S. demographic trends seldom command headlines as they did in the 1970s, when there was a good deal of hype about excessive population growth. Perhaps they should now, because there are clouds on the horizon. The U.S. population’s continued—albeit slow—growth bodes well for the economy, at least in the medium term, but the annual growth rate reached its nadir in 2021, followed by a modest uptick in 2022 stemming from a rebound in international migration and, for the first time since 2014, an increase in the number of births. Fertility tends to fall during economic contractions and rise when economic conditions improve, but the current U.S. total fertility rate (TFR) of about 1.7 births per woman remains below the rate that is required for a generation to replace itself, at 2.1 births per woman. Resumption of international migration is only a partial solution for slowing growth. Most international migrants are of prime working age, therefore immigration partly forestalls population decline and aging; however, its rejuvenating effects tend to be modest, even in countries with long immigration histories.
Of course, national demographic trends conceal large geographic differences, as evidenced by the recent experiences of the four largest states: California, Texas, Florida, and New York. California and New York were among the 18 U.S. states that lost population last year, with New York registering the largest absolute and percentage declines for any U.S. state. In contrast, Texas and Florida recorded above-average population growth last year, at 1.6% and 1.9% respectively, partly fueled by internal migration from other states. These population shifts are highly consequential. Neither Texas nor Florida levies state income taxes, and both announced 2023 budget surpluses, while deficits are expected in New York and California. Additionally, by not taxing retirement incomes, Florida and Texas are increasingly attractive to wealthy boomers who want to shelter their nest eggs. Both states are also appealing to investors, through lucrative tax breaks and right-to-work laws that prohibit unions from requiring workers to pay dues as a condition of employment.
Demography is not destiny, but recent demographic trends have implications for the contours of inequality, investments in children, public services, social insurance systems, housing affordability, and infrastructure, among many others. A comparison of Texas and Florida, the second and third largest states, brings demographically framed policy choices into sharp focus. In 2021, for example, Florida’s population ranked among the top five oldest by state, with a median age of 42.7, while Texas’s was among the five youngest, with a median age of 35.4. Both Florida and Texas have sizable foreign-born populations (21% and 17% respectively), both benefited from net domestic migration, and both gained seats in Congress.
On several occasions, colleagues have asked me if there are volumes of The ANNALS that feature state and local perspectives on topics that can benefit from evidence-based policy. For more than 130 years, The ANNALS has assembled and communicated social science research to academic and policy audiences, and several volumes in the last 25 years have addressed international migration, including cross-national trends. That said, our journal has been less effective in reaching state and local policymakers than it has been in communicating its insights to federal policymakers and policy influencers. Perhaps it is time to deliberate the economic and social consequences of demographic change, by showcasing policy choices facing states and local governments.