Is Virginia’s Population Growth Slowing?

by James A. Bacon

The 2011 U.S. Census numbers are in, and the Brookings Institution is on top of them. The big story: Population growth continued decelerating across the United States and in Virginia, although the Old Dominion is still growing more rapidly than the national average.

Brookings attributes the decline to several factors: weak immigration, a downturn in fertility and the passage of Bay Boomers out of their child-bearing years. The aging of the Boomers is irreversible. However, the dip in immigration and fertility could be temporary, related to the economic downturn. Fewer immigrants are coming to the U.S. because they see less economic opportunity, while women are deferring child-bearing until economic prospects improve. Giving credence to this interpretation, the chart below shows that the decline began around 2006-2007, more or less when the recession began.

However, the fit is less than perfect. For starters, the recession didn’t begin until 2007. The downturn in population growth preceded it. Moreover, the Northeast saw a significant uptick in population growth through 2009, defying the economic downturn. Recession is at best a partial explanation. Another reason may be stronger economic growth and an increasing in economic opportunity in countries, most notably Mexico, that accounted for most immigrants. As I have suggested in an earlier blog post, the 1990s-2000s immigrant surge may have peaked and may be undergoing a long-term hiatus.

As for Virginia, the Old Dominion has never been a top-tier growth state. Although we are lumped in with the “South” and population growth has exceeded that of the Northeast and Midwest, we never kept pace with Texas, Florida or North Carolina. While Virginia ranked as the 15th fastest-growing state in 2010-11, according to Brookings numbers, compared to 2005-2006, our growth rate has fallen faster than the national average. Admittedly, the picture is complicated: Population growth in Virginia actually increased through 2009-10 before plunging last year.

I would hypothesize that the population growth was concentrated in Northern Virginia, which benefited from an unprecedented level of federal deficit spending, hiring and outsourcing to contractors. As the stimulus package petered out in the last year, so did some of the economic impetus for economic growth. Federal spending cannot possibly continue growing at the same rate as the past few years, so that economic prop for Northern Virginia population growth is likely to disappear.

Brookings frets about the slowdown in population growth from a national economic perspective. Fewer people in the workforce means slower economic growth and fewer taxpayers to support an aging population. Both are valid concerns. The picture is more mixed from a state-local perspective, however.

Fewer people equals reduced growth pressure — fewer houses to build, fewer schools, fewer roads, less infrastructure — in Virginia’s fast-growth counties. As the state and counties plan for future growth, there is a temptation to rely upon  population projections extrapolated from past trends. But if immigration is slowing, women are having fewer babies and the population is growing older, those projections may not pan out.

It’s certainly too early on the basis of a single year’s spectacular fall-off in Virginia population growth to draw firm conclusions. But the trend bears watching. The last thing we need to do in an era of constrained public finances is over-invest in transportation and other infrastructure based on projections that never materialize.