A growing elderly population and increasing racial diversity among the young are two major trends of growing consequence for builders and developers in the period ahead, according to demographers attending last fall's meeting of the Urban Land Institute in Washington, D.C.

Senior fellows from the Brookings Institution suggested that the recession had somewhat complicated the U.S. population picture, but migration trends prevailing prior to the collapse of the financial system will return.

Assessing the population mix, William Frey said that immigration had been adding one million persons annually, and although it slowed notably as the nation's economy soured, it is poised to push whites to a tipping point in 2042, when for the first time they will be in the minority, falling to 46% nationwide.

Also, Jan. 1 of the New Year marked the first 65th birthdays of members of the post-World War II baby boom, and that is the start of a 20-year boom for seniors, Frey said. Members of this out-sized generation, which is now being surpassed in size by their children, who are roughly in their 20s, "have always broken the mold," he said, and in how they face their later years, "they will be different." Numbers alone suggest significant change at the top of the population chart, with the share of the 65+ population climbing from 12.4% in 2000 to 20.2% by 2050.

At the same time, the population will continue to fan out in familiar patterns. The 2010 Census — which Frey pointed out asked only 10 questions and is therefore less informative than the Census Bureau's annual American Community Survey — portrays a wider picture of population gains in the Sunbelt and West at the expense of the Northeast and the Midwest.

Looking beyond regional shifts related to sunshine and job growth, people have been leaving more expensive coastal areas, such as those of California, and moving into the interior of the country in search of cheaper housing and less density, both of which have been easy to find in more suburban neighborhoods, according to Frey. Many underutilized parts of the country have been filling up. That trend screeched to a halt during the recession when people started losing their jobs and were forced to double up with family and friends, but "it will rev up again," he predicted.

U.S. Divided Into Three Parts

Frey has divided the U.S. into three distinct demographic regions, based on characteristics that can give builders and developers a broad sense of the populations they increasingly will be serving in those areas.

Home today to roughly 40% of the U.S. population and the most racially diverse of the three regions with a 53% share of whites, Melting Pot America is based in New York, New Jersey, Florida, Texas, New Mexico, California and Alaska. It is the place to disproportionately find those who have emigrated to the U.S. in recent years. It contains 70% of the nation's foreign-born residents, as opposed to 37% of native-born Americans. Seventy-six percent of those who speak Spanish at home live in these states, as do 68% of those who converse in an Asian language. English is the first language of only 34%. Immigration accounted for 45% of the growth of this region from 2000-2009; domestic population actually drew its residents down by a full 19%.

The New Sunbelt (68% white) is where the existing domestic population feels most at home, attracted by opportunities to pursue a more inexpensive lifestyle and encounter a more suburban character. Here there can still readily be found the traditional white husband and wife household with children that once was a mainstay of suburban development but has been dwindling to a 20% population share. Domestic migration accounted for 66% of the region's growth in the 2000-2009 period, while immigration also provided 30% of its boost. Geographically expansive, this region includes Virginia, the Carolinas, Tennessee, Georgia, the Pacific Northwest, Idaho, Nevada, Arizona, Utah and Colorado.

The remainder of the country — 28 states and the District of Columbia — comprises the Heartland (79% white), where growth is relatively slow and domestic migration over the 10 years preceding 2010 provided a small drag (-15%) and immigration a small lift (16%).

At the top of the list for magnet metropolitan areas for immigrants from 2000-2009 were: New York (1.079 million), Los Angeles (803,000), Miami (506,000), Chicago (363,000), Dallas (324,000), Washington, D.C. (310,000), Houston (289,000) and San Francisco (257,000).

During that same period, the top eight metro areas for drawing domestic migrants were: Phoenix (531,000), Riverside, Calif. (457,000), Atlanta (413,000), Dallas (308,000), Las Vegas (299,000), Tampa, Fla. (255,000), Charlotte, N.C. (243,000) and Houston (243,000).

The greatest domestic out-migration occurred in: New York (a loss of 1.9 million), Los Angeles (1.3 million), Chicago (547,000), Detroit (362,000), San Francisco (344,000), New Orleans (299,000), Miami (285,000) and San Jose, Calif. (233,000).

Frey noted that domestic population movements have generally followed jobs. A dearth of available jobs may help explain why the share of Americans moving last year was roughly in the low 12% range — the lowest rate since the end of World War II. The nation was decidedly on the move in the 1950s and 1960s, when roughly one-fifth of households moved each year, a pace that slowed to 16% in the 1990s and 13% in the early 2000s.

Frey said he discerned a "big drop in long-distance migration" and he doesn't see an end to this trend in sight. Of those who moved between the states in 2004-2005, 22% cited housing-related reasons; that dropped to 14% in 2008-2009.

The more recent demographic story shows Americans in retreat from many boom areas. According to Frey's research, Phoenix, which added almost 99,000 migrants in 2004-2005 to rank #1 in population growth, was down to growth of about 12,000 in 2008-2009, falling to 13th place. Second ranked Riverside, Calif., dropped from more than 72,000 to a loss of 616 and a rank of 279 between the two periods. Third-placed Tampa dropped from almost 52,000 to about 4,700 and 30th place; fourth-placed Orlando was down from almost 52,000 to a loss of almost 4,300 and 346th place; fifth-ranked Atlanta declined from about 51,000 to more than 17,000 and ninth place; and sixth-placed Las Vegas dropped from more than 39,000 to a loss of 1,256 and the 306th spot of migration gainers.

The new line-up of migration gainers for 2008-2009: Houston (almost 50,000), Dallas (more than 45,000), Austin, Texas (almost 26,000), Raleigh, N.C. (more than 20,000), Denver (almost 20,000) and Charlotte (more than 19,000).

The apparent difficulty of being able to afford to keep a home in suburban or even farther-out areas worked to the benefit of the cities, Frey said. Nineteen of 36 cities with populations of more than one million saw faster growth in 2008-2009, while the suburbs and exurbs generally saw declines in their rates of growth.

Minority Young and Elderly Whites

Frey’s research has pinpointed metro gains in black, Hispanic and Asian populations around the country, and he noted that the places with the youngest populations are also the most racially and ethnically diverse.

Idaho, Nevada, Colorado, Arizona, Texas, Florida, Georgia and North Carolina all saw growth in their under-18 population of 10% or more between 2000 and 2009.

As of 2009, states where minority children constituted a majority included California, Nevada, Arizona, New Mexico, Texas, Florida and Georgia. These tend to be the children of immigrants, he said.

Looking at education levels of the population by race and ethnicity, he found that the Hispanic population is lagging the most, with 39% having less than a high school degree and only 13% graduating from college. That’s compared to 19% of blacks having less than high school and 18% graduating from college; and 10% and 31% for whites and 15% and 50% for Asians, respectively.

The current decade will see rapid growth in the young elderly between 65 and 74 and similar growth will occur in the old elderly 75+ population in the period of 2020-2030, he said.

Projected growth in the 65+ population between 2000 and 2030 will run above 140% in Georgia, Florida, Texas, New Mexico, Arizona, Nevada, Wyoming, Idaho and Alaska. Many of these states have climates that are especially conducive to allowing elderly households to age in place. Nevada will see the biggest change, with a 264% increase, and Pennsylvania will see the least — 51%.

Frey added that there is a great deal of economic inequality among the baby boom elderly. Consequently, “they won’t all be Yuppie elderly going to gated and retirement communities.”

Seventy-one percent of seniors will still be white in 2030, but that will be the case for only 46% of children.

“We are a country very much in flux,” Frey concluded.

Educating the Workforce

Brookings Senior Fellow Anthony Downs said that the period ahead will see the most vigorous population growth in metropolitan areas but outside the central city, the continuation of a trend that flies in the face of the higher density, closer-in communities that most urban planners want.

The biggest demographic challenge ahead, however, is finding a better racial balance for the population, he said, in order to boost the educational level of the workforce as it becomes increasingly dominated by minorities.

“Most white households don’t want to live in areas with more than one-third Hispanics or African Americans,” he said. “But if we continue to live in segregated groups, we may be dragging the education of workers so low that we won’t be competitive with foreign nations.”

From 2010 to 2020, Frey projected that the U.S. labor force will grow by 9.6 million Hispanics (the least educated), 3.5 million Asians and others and two million blacks. The labor force will lose 5 million white workers during this period.

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