via NPR Planet Money


In his latest New York Times Magazine column, Adam Davidson writes, “mobility has reached its lowest level in recorded history…This suggests, among other things, that people aren’t packing up for new economic opportunities the way they used to.”

To continue the discussion, we asked two demographic experts on different sides of the debate – Joseph P. Ferrie of Northwestern University and William H. Frey of the Brookings Institution – to answer the following question:

Have Americans lost the economic incentive to move?

William Frey’s response:

In a recent campaign stump speech, Presidential candidate Mitt Romney testified, “I believe in freedom. I believe in liberty. I believe in an opportunity society.” I was waiting for him to next say, “and I believe in the right for Americans to move any place, anytime to achieve their goals.” He didn’t say that, but high migration levels surely have done much to keep our economic engine humming – compared with the more stagnant levels in Europe and Japan.

Of course, migration, both short distance and long, hit historic low points in the last four years (I summarized the trends here and here).

Does this mean that we are on our way to economic stagnation, which will keep large numbers of our work force perpetually stuck in place? I don’t think so.

Migration rates have certainly declined since the 1950′s, when we had a younger (and thus more mobile) population, and renters were buying GI-Bill financed homes. Since then, the population has became older, more settled into owned homes, and dual earner couples proliferated. The nation’s shifting demography made us a little more sedentary. But this does not mean that opportunities became less available to young people or that they were less likely to migrate to take them.

As late as 2005, a healthy 29 percent of twenty-somethings changed residences annually. Migration driven population booms occurred in dozens of Sunbelt metropolitan areas, attracting workers of all skill levels.

What happened next was the triple tsunami of a bursting housing market bubble, a financial crisis, and the Great Recession. Potential movers, especially young people, were unable to finance a new home, sell their old one, or obtain a job. Many young adults are stuck in place, living with their parents, putting off marriage, and remaining underemployed.

We are certainly in an economic mess, which may keep part of a generation from moving on with their lives. But when the economy does pick up, there will be a pent-up demand for migration among these young people and the next generation. It’s in our national DNA. And it won’t necessarily follow an education-based mover stayer divide. Hispanics and Asians of all skill levels will contribute mightily to our labor force, as they disperse around the country.

Still, it’s probably true that Mitt Romney’s unfettered capitalism will need some assistance from the government toward training this next generation for the jobs they move to take.

Have Americans lost the economic incentive to move?

Joseph Ferrie’s response:

In the 1830s, the extraordinary mobility of the U.S. population was noted by Alexis De Tocqueville: “[M]illions of men are marching at once toward the same horizon…Fortune has been promised to them somewhere in the west, and to the west they go to find it.” How did we get from there – a nation perpetually in motion – to here – a nation seemingly stuck in place?

The population’s movement peaked in the late nineteenth century. Why? The simple answer is the movement of the western frontier. It left in its wake nascent urban centers, sites that could process and ship farm products to the east and import manufactured goods back to the west. These communities ranged from small towns to great cities that sprang up almost overnight. Chicago is the most dramatic example: its population grew from 4,500 in 1840 to more than 500,000 in 1880. Population growth this rapid provided enormous opportunities for potential migrants. They easily obtained jobs in factories, warehouses, and city offices. At the same time, the U.S. was a place with substantial differences across regions in the products and industries, providing migrants a range of choices in destinations that modern movers no longer see before them.

One lesson that can be drawn from this look backward at past U.S. migration is that geographic mobility and economic mobility were closely linked for much of the nation’s history. The US had exceptionally high rates of economic mobility in the nineteenth century, compared to older European countries. The second is that going forward, geographic mobility will be less closely linked to economic mobility. The U.S. has become more economically homogenous. Americans now experience, if anything, somewhat less income mobility across generations than many Europeans.

This is unfortunate in at least one respect: it makes the route to economic mobility today considerably less forgiving than it was in the past. In the nineteenth century, an ambitious son or daughter could see their income rise simply through the act of changing location, an investment that could be made until well into their adult years. Today, by contrast, education is the route to advancement, but educational investments are already largely determined by the time individuals have reached their early twenties. Economic mobility and the “American Dream” of a better tomorrow are, if not dead, at least a great deal more elusive than they were in the past, when a train ticket to Chicago was virtually all it took to make a big step up the economic ladder.

FOR IMMEDIATE RELEASE

CONTACT: David Mace (802) 828-3333

Department of Economic Development Releases Comprehensive Study of Young People to
Determine What Draws Them to Vermont

MONTPELIER – Young workers want to live in Vermont, but the state must create high-paying
jobs and affordable housing for them – and let them know about it.

Those were among the findings of a comprehensive study of young people designed to find out
what will make the next generation of Vermonters want to live and work here.

“This report tells us that young people with a connection to Vermont – including a very
significant majority of those who come to attend college – also consider Vermont as a potentially
attractive place to live and work,” said Vermont Commissioner of Economic Development Mike
Quinn.

Speaking at a briefing in Burlington late last week to announce the release of the “Growing
Vermont’s Next Generation Workforce” report, Quinn noted that two-thirds of nearly 2,000
alumni of Vermont’s colleges and universities now living out of state said they’d consider
returning.

“We need to remind them that we’d like to have them back,” he said. “And in ways and through
channels that work for them.”

The report was commissioned by Gov. Jim Douglas in January 2006 and was prepared by a team
of consultants that included Next Generation Consulting of Madison Wisconsin; the University
of Vermont Center for Rural Studies; and led by TIP Strategies of Austin, Texas.

Governor Douglas raised the issue in response to news that Vermont had become the second
oldest state in the nation and amid reports that employers were expressing concerns about their
aging workforces and their ability to find workers.

“The state of Vermont will not be able to keep all of its young people from leaving,” said Jon
Roberts, Managing Director of Economic Development for TIP Strategies. “But it can persuade
some to return, and attract other young people as well. Instead of worrying about ‘brain drain’
we need to think in terms of ‘brain churn.’”

Rebecca Ryan, president of Next Generation Consulting, said that nearly 1,200 “deliberators”
who have considered moving to Vermont are mostly women (57 percent); single; and
professionals but that work isn’t necessarily the most important thing to them.

“These are educated, talented and mobile people,” she said. “The can choose where they want to
live and work, and the community they live in is as important as their job opportunities when
deciding where to go.”

She noted that 94 percent of those surveyed said that “a community where I can afford to live,
work, and play,” was an important factor in choosing their home.

“But only 33 percent of those living in the state thought that Vermont offers this,” Quinn said.
“Clearly, the issue of affordability – wages versus the costs of housing, taxes, and living – is one
that must be addressed.”

Other recommendations included:

• Strengthening the ties between education and business to help develop a workforce
whose skills match employers’ needs and to inform workers of opportunities.

• Actively targeting young people outside Vermont with messages about jobs, housing,
educational opportunities, and other activities.

• Marketing the state to potential entrepreneurs: “Current generational research strongly
underscores the idea that young people see themselves as an ‘economy of one,’” the
report said.

The Department of Economic Development will fully evaluate the findings and have an ongoing
conversation with stakeholders before determining what its next steps are.

“There are real barriers, but there are real opportunities here as well,” Quinn said. “Now that we
have real data and concrete recommendations based on that data, we have a roadmap. We can do
this.”

To read the full report, visit the Department of Economic Development’s website:
http://www.thinkvermont.com/publications/

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