Category Archives: Demographics

The Metropolitanization of Virginia

1990 commuting patterns. The darker the color, the longer the average commute.

1990 commuting patterns. The darker the color, the longer the average commute. Source: StatChat

by James A. Bacon

A couple of weeks ago, three guys came rolling through my neighborhood in a heavy pickup truck and pitched me on cutting down some dead limbs and trees in my back yard. They lived in Rappahannock County, they said; they’d spent three hours driving to Richmond looking for work and when they finished with us would spend three hours driving home. Their routine, they said, was to hit the sack, get some sleep, and then get up early in the morning and repeat the ordeal.

The story is testimony to many things, including the lengths to which some people will go to earning a living. But it is also an example of how the workforce in lightly populated “rural” counties, where inhabitants once farmed or worked in light manufacturing, is getting sucked into the orbit of Virginia’s larger metropolitan regions.

2014 commuting patterns.

2014 commuting patterns.

Many commentators on urban affairs, myself included, have tended to view the steady geographic expansion of Metropolitan Statistical Areas (MSAs) as a consequence of so-called “suburban sprawl,” the pattern of low-density, hop-scotch development — urban areas pushing outward. And that remains the dominant explanation for the ever-expanding size of our MSAs. But Hamilton Lombard, writing in the StatChat blog, notes that there’s more to the story:

Workers in “rural” counties are commuting to metropolitan areas in search of work: “Agricultural employment declined in nearly every rural U.S. county, while manufacturing jobs in most small towns also began to disappear by the 1980s. The result of these two trends has been that residents in most rural counties have grown more dependent on nearby cities for jobs. …  In many rural counties … the proportion of workers commuting to a nearby city has risen above a quarter of all workers, causing counties to become part of another city’s metropolitan area.

In Virginia, the portion of commuters who traveled over an hour each way to work rose from 6.5 percent in 1990 to 10 percent in 2014. But in rural areas that are within commuting distance of city centers, the percent of residents who drove over 60 minutes to get to work often doubled or tripled in the same period. In some counties on the edges of large metro areas, such as Warren County, Virginia, located 70 miles west of Washington DC, it is common for between a quarter and a third of residents to commute more than an hour to get to work.

As an example, Lombard points to Floyd County, which was incorporated into the Blacksburg MSA in 2013. The 20th century saw the transformation of Floyd’s economic base from agriculture to manufacturing, and then the hollowing out of manufacturing. But the growth of Virginia Tech and Radford Universities created jobs for Floyd residents willing to make the commute. As a bedroom community, Floyd’s population has rebounded to levels last seen in 1900, .

Given this analysis, the hollowing out of Virginia’s “rural” economy is even worse than it appears from traditional unemployment figures. An increasing number of Virginians outside the metropolitan areas stay employed by commuting long distances to wherever they can find jobs.

The New Map of Economic Growth

Jobs growth during the recovery from EIG

by James A. Bacon

Not only has job creation and new business formation been weak in the current business cycle, it has been more concentrated geographically than in the past. Unfortunately for the Old Dominion, between 2010 and 2014 that concentration did not occur here.

This analysis points to very different futures for American communities, suggesting that the gains from growth have and will continue to consolidate in the largest and most dynamic counties and leave other areas searching for their place in the new economy,” writes the Economic Innovation Group in a new publication, “The New Map of Economic Growth and Recovery.”

The report buttresses an argument familiar to Bacon’s Rebellion readers: that larger metropolitan areas enjoy a significant competitive advantage in the Knowledge Economy. Skilled and educated employees seek large labor markets that provide a diversity of employment opportunities, while corporations seek larger, deeper labor markets that provide access to a diversity of skilled and educated employees. The dynamics of labor markets outweigh factors that confer competitive advantage in the old industrial economy such as access to transportation and natural resources, lower labor costs, low taxes and a low cost of doing business.

In summary: Large metros enjoy a major competitive advantage, smaller metros are teetering on a knife’s edge, and rural areas and small towns are hosed.

“The U.S. economy is becoming far more reliant on a small number of super-performing counties to generate new businesses,” EIG says. “A mere 20 counties accounting for only 17 percent of the U.S. population were responsible for half of the net national increase in business establishments from 2010 to 2014.”

The report does not speculate whether the trend is the result of temporary economic or political factors or is an irreversible long-term trend.

Graphic credit: EGI

Graphic credit: EGI

Two trends contribute to the sharp decline in the number of businesses: a higher rate of firm deaths (more companies getting acquired or going out of business) and a collapse in new business formation, as can be seen below.

births_deaths

What could account for these trends? One logical possibility: In a blast of creative destruction associated with the digital economy, a relatively small number of new companies are displacing many established businesses. Another possibility: A wave of economic regulation in recent years has hobbled large swaths of the economy — the banking industry, the Internet, health care, energy, and so on — and has created new economies of scale that favor large, established corporations, encourages mergers and consolidations, and throws up barriers to entry to new firms. Most likely, both are at work.

Weakness in the national economy means that everyone is swimming upstream. Only a small number of metropolitan areas are strong enough to make any progress swimming against the current. Mega-trends favor the mega-metros.

But mega-trends won’t tell the whole story. Some large metros bungle their opportunities though corruption, business-hostile policies and mal-investment of public resources. Some smaller communities buck the broader trends by building defensible economic niches. The news from the EIG report is discouraging, but short-term trends need not dictate our long-term destiny.

Virginia 11th Best for Veteran Retirees

Source: WalletHub

Virginia scores a disappointing 11th place in WalletHub’s ranking of the “2016 Best & Worst States for Military Retirees” based on 20 metrics encompassing economic environment, quality of life and health care.

The Old Dominion racked up creditable 3rd place for economic environment (eight metrics including state taxes on military pensions and percentage of veteran-owned businesses, among others) and 4th place for quality-of-life (seven metrics including veterans per capita and percentage of homeless veterans). But the state scored a dismal 48th place finish for health care, which reflects five metrics including the number of VA health care facilities per number of veterans and recommendability of VA hospitals.

The impression created by the metrics is that veterans receive sub-par health care in Virginia. Whether that is a function of poorly run VA facilities or issues with Virginia’s broader health care system is impossible to deduce from WalletHub’s presentation. But it’s a question worth asking.

— JAB

IG of the Day: The South (Atlantic Coast) Shall Rise Again

VirginiaPop_2040.2

Chart credit: Demographics Research Group. (Click for larger image)

By the year 2040, Virginia will be the 10th most populous state in the country, if projections by the Demographics Research Group at the University of Virginia pan out. The Old Dominion will bump Michigan from the Top 10 list.

Meanwhile, North Carolina will climb ahead of Ohio to take the No. 8 spot, and Georgia will supplant Illinois for No. 6.

The South Atlantic coastal states from Virginia to Florida represent one of the most dynamic regions of the country. The region doesn’t get the credit it deserves from analysts fixed upon traditional regional groupings like “the South” or the “Mid-Atlantic.” Some aspiring geographer could write a great PhD thesis on the topic.

— JAB

Is There Really a Problem Here?

washington_metro

by James A. Bacon

A new report by the Pew Research Center, “The Geography of America’s Shrinking Middle Class,” has garnered widespread attention by focusing on the erosion of America’s “middle class” between 2000 and 2014, confirming the dominant narrative of increasing income inequality across the United States. As a summary of the report emphasizes, “The middle class lost ground in nearly nine-in-ten U.S. metropolitan areas examined.”

The percentile share of the middle class fell in 203 of the 229 metropolitan statistical areas examined in the analysis. Meanwhile, the share of adults in upper-income households increased in 172 regions and the share in lower-income households increased in 160 regions over the same 14-year period.

The decline of the middle class is a reflection of rising income inequality in the U.S. Generally speaking, middle-class households are more prevalent in metropolitan areas where there is less of a gap between the incomes of households near the top and the bottom ends of the income distribution. Moreover, from 2000 to 2014, the middle-class share decreased more in areas with a greater increase in income inequality.

The study neglects to tell us how the shrinking middle class is faring nationally according to its methodology, or whether it is due primarily to upward or downward mobility. The trends vary widely from region to region, reflecting the circumstances of local economies. Manufacturing-oriented regions fared poorly, while energy-related economies prospered. At the same time, some regions are doing a better job of building their technology and professional-services sectors. If, as a generality, larger metros are making progress while smaller metros are sliding, that’s unfortunate for the smaller metros but it’s not necessarily a national crisis — it simply reflects the reality that competitive economic advantage is shifting from smaller to larger metros. It is a basic question but Pew ignores it.

While there is much to be said in favor of a strong middle class, a shrinking middle class (defined by Pew as between about $42,000 to $125,000 per year for a family of three) can be construed as a good thing if people are rising into the so-called upper-income class. The trend is clearly undesirable if it results from households sinking into the lower-income brackets. What appears to be happening is a little of both — although in Virginia upward mobility predominates.

Pew’s analysis covered five metropolitan regions in Virginia: Washington, Hampton Roads, Richmond, Lynchburg and Blacksburg. (Don’t ask me why Roanoke, Charlottesville and other smaller metros weren’t included, I don’t know.)

The Washington metro (see chart above) experienced what could be construed as an alarming decline in the middle class — 6.1 percentage points. But even a cursory look at the data shows that the lower-income group remained stable (actually declining 0.1%) while the upper-income group shot up. By Pew’s measure, the Washington region became more unequal. But it apparently did so by hundreds of thousands of households moving into higher income brackets. Is this “losing ground?” Are we supposed to flagellate ourselves over this?

Admittedly, Washington may be an outlier. It is, after all, America’s imperial city and, with the exception of occasional bouts of sequestration or defense cutbacks, it is largely immune from the trends that afflict other parts of the country. So, let’s take a look at Virginia’s second largest metropolitan area, Hampton Roads (labeled Virginia Beach).

virginia_beach_metro

Once again, the middle class shrunk. Oh, noooo! But look closer. So did the lower-income class. The affluent class increased by 4.8 percentage points. It is hard to spin this as anything but a positive development.

The outlook for the other three Virginia metros is less clear cut. Here’s Richmond:

richmond_metro

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Map of the Day: Virginia 2040

VirginiaPop_2040

The year 2040 sounds like a long way off. But 24 years is not that far distant when it comes to planning roads, transit, utilities, schools and other essentials for life in the 21st century, and scrounging up the money to pay for it all. If these projections by the Demographics Research Group at the Weldon Cooper Center for Public Service are anywhere near the mark, Virginia will gain another 1.7 million residents by 2040, surpassing the 10.5 million mark. And most of that growth will occur where people already are, in the state’s existing metropolitan regions.

— JAB

“Coming Apart” — Virginia Edition

one_out_of_three

Odds are, one out of three of these babies is born out of wedlock.

by James A. Bacon

Three years ago sociologist Charles Murray wrote a book, “Coming Apart: The State of White America, 1960-2010,” in which he described the social disintegration of lower-income and working-class whites in the United States. He documented the decline of marriage, the rise of out-of-wedlock births, the spread of substance abuse, and deterioration of work ethic, respect for the law and religious observance. The range of social pathologies once stereotyped as African-American is increasingly prevalent among whites. Anyone interested in the problem of social and income inequality in America needs to read the book.

Against that backdrop, I now present some numbers from a fascinating data set published by the Virginia Department of Health and passed along by reader Jim Weigand. This table breaks down the rate of “non-marital” births by whites, blacks and “others” by locality and planning district across Virginia.

The overall numbers should be terrifying to anyone worried that the rise of fatherless families contributes to dysfunctional social behaviors such as poor school performance, substance abuse, sub-par employment prospects, descent into criminality, child neglect and abuse, and, of course, more out-of-wedlock births in a downward social spiral. Across the state, one out of three (34%) children is born out of wedlock. That works out to 25.2% for whites, 64.7% for blacks, and 29.2% for others. (“Others” is a meaningless category which conflates Asians with their lower rate of out-of-wedlock-birth and Hispanics with their higher rate.)

In a majority of rural counties, the incidence of white non-marital births runs well over 30%. In Alleghany County the rate is 50%. One might expect as much in communities where a large percentage of the population lives in trailer parks. But in reasonably affluent communities like Henrico and Chesterfield counties, out-of-wedlock birth rates for whites run an astonishingly high 22.9% and 25.0% respectively. Even in super-affluent counties such as Fairfax and Loudoun, the white, non-marital birth rates are 12.2% and 11.3% respectively.

(Not every out-of-wedlock child is “fatherless,” of course. Many are born to unmarried but cohabitating couples in which the father continues to play a role, at least for as long as the couples stay together. Apparently, cohabiting in Europe can lead to stable social arrangements, but in the United States cohabitation tends to be a less stable relationship than marriage, and fathers tend to be less involved in the raising of the child.)

The situation for African-Americans is a social calamity but I can’t talk about that without someone insinuating that I’m a racist. So, for now, let’s focus on what’s happening in white America. That’s bad enough.