Has U.S. economy bottomed out? Census suggests yes
Job applicants wait for the opening of a job fair held by National Career Fairs in Fort Lauderdale, Fla, Sept. 17, 2012. The U.S. economy is showing signs of finally bottoming out: Americans are on the move again after record numbers had stayed put, more young adults are leaving their parents' homes to take a chance with college or the job market, once-sharp declines in births are leveling off and poverty is slowing. (AP / Lynne Sladky)
Published Thursday, September 20, 2012 6:12AM EDT
Last Updated Thursday, September 20, 2012 10:46AM EDT
WASHINGTON -- The U.S. economy is showing signs of finally bottoming out: Americans are on the move again after record numbers had stayed put, more young adults are leaving their parents' homes to take a chance with college or the job market, once-sharp declines in births are levelling off and poverty is slowing.
New 2011 census data released Thursday offer glimmers of hope in an economic recovery that technically began in mid-2009. But not all is well. The jobless rate remains high at 8.1 per cent. Home ownership dropped for a fifth straight year to 64.6 per cent, the lowest in more than a decade. More Americans than ever are turning to food stamps, while residents in housing that is considered "crowded" held steady at 1 per cent, tied for the highest since 2003.
And growth in the foreign-born population is slowing.
Taken as a whole, however, analysts say the latest data provide wide-ranging evidence of a stabilizing U.S. economy. Coming five years after the housing bust, such a levelling off would mark an end to the longest and most pernicious economic decline since World War II.
"We may be seeing the beginning of the American family's recovery from the Great Recession," said Andrew Cherlin, a professor of sociology and public policy at Johns Hopkins University. He pointed in particular to the upswing in mobility and to young men moving out of their parents' homes, both signs that more young adults were testing out job prospects.
"It could be the modest number of new jobs or simply the belief that the worst is over," Cherlin said.
Richard Freeman, an economist at Harvard University, said the data point to a "fragile recovery," with the economy still at risk of falling back into recession, depending in part on who is president and whether Congress averts a "fiscal cliff" of deep government spending cuts and higher taxes taking effect in January. "Given the situation in the world economy, we are doing better than many other countries," he said. "Government policies remain critical."
The census figures also show slowing growth in the foreign-born population, which increased to 40.4 million, or 13 per cent of the U.S. population. Last year's immigration increase of 400,000 people was the lowest in a decade, reflecting a minimal gain of Latinos after many Mexicans already in the U.S. opted to return home. Some 11 million people are estimated to be in the U.S. illegally.
The bulk of new immigrants are now higher-skilled workers from Asian countries such as China and India, contributing to increases in the foreign-born population in California, New York, Illinois and New Jersey.
Income inequality varied widely by region. The gap between rich and poor was most evident in the District of Columbia, New York, Connecticut, Louisiana and New Mexico, where immigrant or minority groups were more numerous.
As a whole, Americans were slowly finding ways to get back on the move. About 12 per cent of the nation's population, or 36.5 million, moved to a new home, up from a record low of 11.6 per cent in 2011.
Among young adults 25 to 29, the most mobile age group, moves also increased to 24.6 per cent from a low of 24.1 per cent in the previous year. Longer-distance moves, typically for those seeking new careers in other regions of the country, rose modestly from 3.4 per cent to 3.8 per cent.
Less willing to rely on parents, roughly 5.6 million Americans ages 25-34, or 13.6 per cent, lived with Mom and Dad, a decrease from 14.2 per cent in the previous year.
The increases in mobility coincide with modest improvements in the job market as well as increased school enrolment, especially in college and at advanced-degree levels.
Marriages dipped to a low of just 50.8 per cent among adults 18 and over, compared with 57 per cent in 2000. Among young adults 25-34, marriage was at 43.1 per cent, also a new low, part of a longer-term cultural trend in which people are choosing to marry at later ages and often live with a partner first.
Births, on the other hand, appeared to be coming back after years of steep declines. In 2011, the number of births dipped by 55,000, or 1 per cent, to 4.1 million, the smallest drop since the pre-recession peak in 2008, according to Kenneth Johnson, a sociology professor and senior demographer at the University of New Hampshire.
"There are signs that young adults have turned a corner," said Mark Mather, associate vice-president at the Population Reference Bureau. "More young adults are staying in school, which will increase their potential earnings when the job market bounces back."
While poverty slowed, food stamp use continued to climb. Roughly 14.9 million, or 13 per cent of U.S. households, received food stamps, the highest level on record for that government aid.
Government programs did much to stave off higher rates of poverty. While the official poverty rate for 2011 remained stuck at 15 per cent, or a record 46.2 million people, the government formula did not take into account noncash aid such as food stamps, which the Census Bureau estimates would have lifted 3.9 million people above the poverty line. If counted, that safety net would have lowered the poverty rate to 13.7 per cent. And without expanded unemployment benefits, which began expiring in 2011, roughly 2.3 million people would have fallen into poverty.
Some 17 states showed statistically significant increases in the poverty rate, led by Louisiana, Oregon, Arizona, Georgia and Hawaii. In contrast, the Washington, D.C., metro area had the lowest level of poverty, about 8 per cent.
"There are signs among all these measures that the multiple downsides of the Great Recession have bottomed out, which is good news especially for young people who have seen their lives put on hold," said William H. Frey, a demographer at Brookings Institution. "There is some light at the end of the tunnel."