Editor’s Note: This article is an annual update of the Population Change Indicator for Pew’s Fiscal 50 Project.
The rate of population growth nationwide was five times slower in 2021 than in the previous 10-year period. The population of 17 states fell last year, including Illinois, Mississippi and West Virginia, the same three states that lost residents in the 2010-20 decade. Although population growth gradually slowed before COVID-19, the pandemic has exacerbated this long-term trend.
In the states, total population growth has been slowing for decades, with the growth rate in the 2010s being the slowest since the Great Depression. In recent years, the increase in mortality due to aging as well as the decline in immigration and the decline in fertility rates are the cause. However, from July 2020 to July 2021, COVID-19 accelerated this trend. For example, restrictions aimed at curbing the spread of the virus have contributed to a drop in the number of new arrivals from abroad. And the Centers for Disease Control and Prevention estimates that there were at least 474,000 deaths associated with COVID-19 in the same 12 months. These deaths and declining immigration have contributed to historically small annual population gains in the United States (under 1 million for the first time since 1937), according to the US Census Bureau.
Slow population growth over the past decade has been particularly pronounced in the Northeast and Midwest, while the South and West were home to the fastest growing states. These regional trends largely continued into 2021. Ten of the 17 states that lost residents last year were in the Northeast and Midwest. For example, New York has lost 319,000 people since mid-2020, a drop of 1.58%, the largest of any state. This is mainly because many residents have left New York for other states.
At the other end of the spectrum, Idaho and Utah gained residents the fastest in 2021 as well as over the decade. In 2021 alone, Idaho grew by 2.88%, adding 53,000 people, and Utah’s population grew by 1.72%, with 56,000 new residents. These two states were followed by a group of southern states and other western states. For half a century, people have turned to the Sun Belt states because of job opportunities, lower cost of living, and warmer climates.
But a group of New England states bucked the regional trend in 2021. The pace of population growth in Connecticut, Maine, New Hampshire and Vermont accelerated over the year compared to their decade-long growth, unlike most of their neighboring states, which lost residents. Gains in all four states in 2021 came from an influx of people from other parts of the United States. From 2010 to 2020, Connecticut’s population grew by the equivalent of 0.09% per year, the slowest growth rate in a decade. In 2021, it was still among the slowest growing states (0.15%), but it was one of only 14 states where the pace of growth accelerated.
A shrinking or slowly growing population can be both a cause and an effect of weakened economic prospects. States experiencing long-term population decline all fell near the bottom of economic growth during the 12-year recovery from the Great Recession. Less economic activity can limit government revenue. While a smaller population may lead to a reduction in some types of spending, it also means there are fewer residents to help cover the costs of long-standing commitments, such as debt and retirement benefits. state employees. On the other hand, states with rapidly growing populations typically have strong labor force growth, which fuels economic activity and helps generate tax revenue to fund any increases in infrastructure spending, d education and other government services.
State populations increase or decrease based on the net effect of births, deaths, and migration to and from other states and overseas, including both documented and undocumented people. Population change measures the difference between all new residents — babies and newcomers from other states and outside the United States — and those who have died or moved away.
While 10-year growth rates illustrate key trends that have helped shape a state’s economic and fiscal conditions, the past year’s growth highlights changes that affect near-term revenue and spending. .
A comparison of 10-year population trends, based on each state’s constant annual growth rate between April 2010 and April 2020, shows:
- After Utah’s 1.7% growth rate and Idaho’s 1.61% growth rate, the fastest growing states over the past decade were Texas (1.49%) and North Dakota (1.48%). These states grew at about three times the 50-state median rate of 0.55% per year and were among the top performers in long-term economic growth.
- Texas added the most people over the decade, but its 10-year growth rate — which measures the steady rate at which the population is expected to change each year, starting in 2010, reaching its 2020 number — has followed Idaho and Utah.
- Besides the declining states – West Virginia (-0.32% per year), Mississippi (-0.02%) and Illinois (-0.01) – the lowest population growth rates were recorded in Connecticut , Michigan (0.19%), and Ohio, Wyoming, and Pennsylvania (0.23% each).
- Growth was slower in the 2010s than in the 2000s in 38 states. Eight states experienced their decade of growth: Illinois, Connecticut, Missouri (0.27%), Wisconsin (0.36%), California (0.60%), Hawaii (0.68%), Arizona (1.13 %) and Florida (1.37%).
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More recently, the evolution of the population from July 2020 to July 2021 shows:
- Of the 17 states where population declined during the year, losses were greatest in New York (-1.58%), Illinois (-0.89%), Hawaii (-0, 71%) and in California (-0.66%). Losses in these states were driven by people who moved.
- Four states have seen population declines because more people have moved in, and more people have died than were born: Massachusetts, Mississippi, Michigan and New Mexico. The data does not separate COVID-19 related deaths from others.
- Excluding the declining states, population grew more slowly during the year than during the 2010-20 period in 19 states. Among them, Washington, Colorado and Oregon have seen the biggest slowdown in growth from their decade-long pace.
- After Idaho and Utah, the population grew fastest in Montana (1.66%), Arizona (1.37%), South Carolina (1.17%), Delaware ( 1.16%) and Texas (1.06%). Gains in each came primarily from new residents moving into the state.
- Fourteen states grew faster than their 10-year rates. Idaho, Montana, Maine and New Hampshire accelerated the most.
- Nationally, gains from international migration exceeded gains from natural increase in 2021. This was the first time that newcomers from other countries contributed more to population growth than gains from births in in any given year, according to the US Census Bureau.
The decennial census is an official population count that the US Constitution requires every 10 years. The count captures population totals as of April 1, 2020, and only reflects the first few weeks of the COVID-19 pandemic that began hitting the United States in March 2020. Neither the decennial census nor the 2021 annual estimates break down COVID-19-related deaths from those from other causes.
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Why demographic changes are important for state finances
Demographic trends are linked to the economic fortunes of states and to public finances. More people generally means more workers and consumers who contribute to economic activity by taking jobs and buying goods and services, which generates more tax revenue. A growing economy, in turn, can attract even more workers and their families. The reverse is generally true for states whose population is slowly decreasing or increasing.
State officials study population trends, in addition to other measures, to forecast resident revenue streams and service demands for budgeting and long-term fiscal planning purposes. A state’s population size and annual changes also affect how much it will receive from certain federal grants.
Some states have begun experimenting with policy options to combat slow population growth. Maine, for example, offers a tax incentive for college graduates to move there, while West Virginia offers a financial incentive to attract new remote workers. Future demographic shifts are increasingly on the radar of state policymakers, as the US Census Bureau projects that population growth will remain tepid. Along with the potential impacts of the pandemic, growth is expected to continue to slow due to falling fertility rates, rising mortality rates as the baby boomer generation ages, and falling rates of international migration. .
Going forward, demographers will carefully study the pandemic in anticipation of a wide range of potential short- and long-term impacts on population trends and distribution. For example, life expectancy and the ratio of births to deaths may fluctuate due to the direct impact of the pandemic on human health, international migration may continue to be depressed, and the wider adoption of remote working can affect individuals’ decisions about where to live.
Population is just one factor that underpins a state’s finances, which are also shaped by political decisions about tax collection and spending, as well as factors outside a state’s borders. and the control of legislators, such as commodity prices. To better understand the fiscal and economic impact of changing population, tax analysts and demographers also study the changing age and income composition of a state’s residents.
Download the data to see trends for individual states from 2010 to 2021. Visit The Pew Charitable Trusts interactive resource Fiscal 50: State Trends and Analysis to sort and analyze data for other indicators of state fiscal health.
Analysis by Joanna Biernacka-Lievestro and Alexandre Fall