11

Population Out-migration and Population Out-migration and Upstate Economic PerformanceUpstate Economic Performance

Prepared for: Prepared for: New York State Network for Economic Research New York State Network for Economic Research

March 30, 2005 conferenceMarch 30, 2005 conference

bybyRichard DeitzRichard Deitz

Senior EconomistSenior EconomistFederal Reserve Bank of New York, Federal Reserve Bank of New York,

Buffalo BranchBuffalo Branchrichard.deitz@ny.frb.org

The Regional Economy of Upstate New York Newsletter is available online at:The Regional Economy of Upstate New York Newsletter is available online at:

www.newyorkfed.org/research/regional_economy/upstatenews.htmlwww.newyorkfed.org/research/regional_economy/upstatenews.html

22

OverviewOverview

Upstate’s performance surrounding the Upstate’s performance surrounding the latest business cyclelatest business cycle

a longer and deeper recession than the nationa longer and deeper recession than the nation

The region’s persistent lagging growth is The region’s persistent lagging growth is primarily structuralprimarily structural

can be viewed through the lens of long-term can be viewed through the lens of long-term population out-migrationpopulation out-migration

33

Average Job Loss in Postwar RecessionsAverage Job Loss in Postwar RecessionsLocal area Peak through TroughLocal area Peak through Trough

-2.10%

-2.20%

-2.60%

-3.30%

-4.20%

-4.30%

-5.80%

US

Albany

Rochester

Syracuse

Binghamton

Utica

Buffalo

Source: U.S. Department of Labor

44

Job Loss in the Last RecessionJob Loss in the Last RecessionLocal area Peak through Local TroughLocal area Peak through Local Trough

-5.5%

-3.1%

-4.4%

-3.2%

-2.1%

-1.4%

US

Albany

Rochester

Syracuse

Binghamton

Utica

Buffalo

Source: U.S. Department of Labor

-7.3%

55

Employment Has Not Yet Recovered Employment Has Not Yet Recovered Local Area Peak to PresentLocal Area Peak to Present

U.S.

Albany

Buffalo

Syracuse

Utica

Rochester

Binghamton

Source: U.S. Department of Labor

- 7.3%

- 5.4%

- 2.8%

- 2.1%

-2.0 %

0.6%

0%

66

Extended Job Losses & Sluggish GainsExtended Job Losses & Sluggish Gains Recession and Recovery TimingRecession and Recovery Timing

U.S.

Albany

Syracuse

Buffalo

Utica

Rochester

Binghamton

Source: U.S. Department of Labor

- 7.3

- 5.5

- 4.4

- 3.2

- 3.1

- 1.4

- 2.1

0.1

1.6

1.2

1.1

2.1

2.1

1/2001 1/2002 1/2003 1/2004 1/2005

77

Industry Gainers and LosersIndustry Gainers and LosersAggregate of Upstate Metro Areas, Peak to presentAggregate of Upstate Metro Areas, Peak to present

-26.7%

-9.0%

-5.3%

-1.9%

2.6%

3.0%

5.0%

6.1%Education & Health Services

Financial Activities

Government

Leisure and Hospitality

Professional & Business Services

Trade, Transportation & Utilities

Information

Manufacturing

Source: U.S. Department of Labor

88

Long-term Long-term Population Out-migrationPopulation Out-migration

99

Population Trends

100

200

300

400

1900 1910 1920 1930 1940 1950 1960 1970 1980 1990 2000

Source: US Census Bureau

Index: 1990 = 100

US

Upstate

1010

The Population is MigratingThe Population is Migratingpopulation growth, 1970-2000population growth, 1970-2000

Percent Change

Source: U.S. Census Bureau

1111

Population Change: 1970-2003Population Change: 1970-2003

40%

21%

9%

7%

2%

-7%

-8%

-11%

-13%

-14%

Source: U.S. Census Bureau

Syracuse

Albany

Glens Falls

US

Rochester

Binghamton

Jamestown

Elmira

Utica

Buffalo

1212

People Follow Jobs &People Follow Jobs &Jobs Follow PeopleJobs Follow People

Jobs have migrated south and west Jobs have migrated south and west manufacturing has shifted to low cost and non-manufacturing has shifted to low cost and non-unionized areas, services have followedunionized areas, services have followed

People have moved to high amenity areasPeople have moved to high amenity areaswarmer weather to the south and westwarmer weather to the south and west

cultural attractions in large metro areascultural attractions in large metro areas

Once begun, people follow jobs and jobs Once begun, people follow jobs and jobs follow peoplefollow people

likely to perpetuate and build momentumlikely to perpetuate and build momentum

1313

Population Change &Population Change &Out-MigrationOut-Migration

1414

Population Growth = (Births – Deaths) + (In-movers – Out-movers)

Natural Increase Net Migration

Net DomesticMigration

Net InternationalMigration

Estimating Out-migrationEstimating Out-migration

1515

Population Growth = (Births – Deaths) + (In-movers – Out-movers)

Net Migration

Net DomesticMigration*

Net InternationalMigration*

+1.8% +8.3%

-6.5%

-9.2% +2.7%

* estimated; assumes upstate NY emigration is negligible

Estimating Out-migrationEstimating Out-migration

1980-2002

1616

Population Change: 1980-2002Population Change: 1980-2002

-7.0%

-6.9%

-6.5%

-6.0%

-4.5%

1.4%

6.5%

7.1%

14.3%

Syracuse

Albany

Glens Falls

Rochester

Binghamton

Jamestown

Elmira

Utica

Buffalo

U.S. Population Growth: 27%

1717

Net Migration: 1980-2002Net Migration: 1980-2002

-12.8%

-12.3%

-12.1%

-10.5%

-10.4%

-6.3%

-0.1%

7.7%

-11.5%

Note: Net migration is population growth minus (births-deaths)

Syracuse

Albany

Glens Falls

Rochester

Binghamton

Jamestown

Elmira

Utica

Buffalo

Net migration

Population growth

1818

Out-Migration is More Severe Among the YoungOut-Migration is More Severe Among the Youngpopulation growth, 1980-2000population growth, 1980-2000

-40%

-20%

0%

20%

40%

60%

80%

0-19 20-34 35-54 55-64 65+

U.S. UpstateSource: U.S. Census Bureau

1919

… … Leading to A Disparate Age DistributionLeading to A Disparate Age Distribution

0

2

4

6

8

10

12

14

16

1980 2000

0

5

10

15

20

25

30

1980 2000

Percent of Population, Age 20-34 Percent of Population, Age 65+

U.S UpstateSource: U.S. Census Bureau

2020

All Upstate Metros Older than TypicalAll Upstate Metros Older than Typical(Percent of Population 65 and over)(Percent of Population 65 and over)

12.4

12.9

13.3

14.3

15.7

15.8

16.5

U.S. Metro Median

Rochester

Syracuse

Albany

Binghamton

Buffalo

Utica

Source: US Bureau of the Census

2121

ConclusionsConclusionsThe last recession was somewhat longer The last recession was somewhat longer and deeper for upstate NYand deeper for upstate NY

Long-term out-migration is contributing to Long-term out-migration is contributing to the region’s slow economic growththe region’s slow economic growth

Out-migration is also aging the region’s Out-migration is also aging the region’s population faster than averagepopulation faster than average

Out-migration trends and impacts needs to Out-migration trends and impacts needs to be considered as part of economic policy be considered as part of economic policy decisionsdecisions