Wednesday, February 26, 2014

"The Era of Dying Places: Everyone Is Starved for Talent, but Migration Is a Thing of the Past"

From Pacific Standard:

What happens when a place is no longer able to attract more people?
Demographic decline signals the shift from the Innovation Economy (Creative Class migration) to the Legacy Economy (return migration). The economic pull of place defines the Innovation Economy. California has been a major beneficiary of this talent flow. But what happens when the state runs out of people to attract? California is dying:
Our longtime solution — attracting new workers from outside California — is no longer a viable source of relief. Migration, both interstate and from abroad, has been dropping since 1990. And today, California must compete with other states and aging economies from across the industrialized world that are starved for workers because of low birthrates. Alternatively, the effects of an outsized senior population can be tempered (somewhat) by pushing baby boomers to delay retirement for five or even 10 years. But is that even desirable?
Emphasis added. Everyone is starved for talent. This is the era of dying places. For many years, California managed a domestic migration deficit via immigration. Texas Governor Rick Perry describes the new normal:
Perry wouldn’t criticize House Republicans for slamming the brakes on federal comprehensive immigration reform, saying that any proposals to offer legalization or citizenship to undocumented immigrants is merely an “academic debate” until the nation’s southern border is completely secured.
And he says that Mexico’s recent moves towards privatizing oil production could take much of the pressure off of the United States to address the problem of undocumented immigrants.
“You will have rather substantive migration back to Mexico from the United States,” he predicted, saying that the move would create attractive jobs in the energy sector for Mexican immigrants who will return home. “The whole immigration issue may really change over the next 12 to 24 months.”
Mexico’s economy is pulling back home Mexican emigrants. But that’s not all. Mexico, like California, is dying:
Fifty years ago Mexico was one of the world’s great producers of people. In the 1960s Mexican women had an average of seven children each; now they have only 2.4, and before 2020 the number is expected to drop below two (see chart 6). That would give Mexico a lower fertility rate than the United States, which is expected to maintain its current rate of about 2.1.
By 2020, Mexico will have a lower birth rate than the United States. Many cities and states depend on domestic and international migration for population growth. The ubiquitous baby bust is an economic bust....MORE