Planning Decisions, Inc.

THE BOTTOM LINE FROM CHUCK LAWTON

What Can We Learn from the New Population Estimates?

Published Saturday January 5, 2008

Last week the U.S. Bureau of the Census released its annual estimate of state population. It showed that Maine had grown by approximately 2,000 people or slightly less than two tenths of a percent. This rate of growth put us at the average for the Northeast and ranked us 46th among all states. Our growth was somewhat higher than that of Rhode Island and Vermont and somewhat lower that that of New Hampshire and Massachusetts, but not radically different from our New England neighbors.

Most of the attention following the release centered on the continuing disparity between the slowly growing Northeast and the rapidly growing Southwest and Southeast and Rocky Mountain states which accounted for all of the top ten states. And this highlights the real story for Maine—changes in the pattern of migration.

Consider the table below.

Between 2000 and 2007, Maine’s natural increase (the number of births less the number of deaths) increased from about 500 to over 2,000. While generally showing an upward movement, Maine’s natural increase tended to jump abruptly from year to year, reflecting the peculiarities of each year’s fertility and mortality.

Net migration, on the other hand, displayed a clear pattern of rapid increase and decline, rising from approximately 1,700 in 2000 to nearly 9,400 in both 2002 and 2003 before falling steadily to an estimated minus 18 in 2007.

While the story of every migrant to and from Maine is undoubtedly different, there does appear to be a relationship to relative income growth. For the years of Maine’s growing immigration—2000 through 2003—the growth of the state’s personal income exceeded the national average. The bursting of the high-tech/dot com bubble in 2001 and 2002 saw the annual growth in national personal income fall from nearly 9 percent in 2000 to less than 3 percent in 2001 and less than 2 percent in 2002. Maine’s personal income growth, in contrast, held steady at about 5 percent in both 2000 and 2001, and dropped only to 3 percent in 2002 and 4 percent in 2003. While not great by the standards of Nevada or Arizona, these growth rates did help attract over 30,000 people to Maine.

In 2004, however, the national growth rate of personal income again exceeded the Maine rate and has remained higher ever since. While these figures don’t mean the slower income growth “caused” the declining rate of immigration, the association is striking. Clearly economic opportunity has a lot to do with whatever may be the ultimate reasons behind people’s moves.

The lesson to me is that while Maine is an attractive place to live, beautiful views don’t put food on the table. If our quality of life is to be the competitive economic advantage we think and hope it can be, we must accompany it with a clear economic development strategy so that it can appeal even when the national economy is doing fine in its own right. We can’t thrive just being a refuge during national downturns.

COMMENTARY