Researchers ID Six Trends That Will Transform U.S.

Posted on Jan. 25, 2011

A browner, grayer and more culturally diverse population and work force will dramatically transform the nation’s social, economic and political institutions, according to a new report by researchers at UNC.

The report, “Six Disruptive Demographic Trends: What Census 2010 Will Reveal,” identifies major shifts in U.S. demographics and their implications for business, consumer markets and the nation’s competitiveness in the global marketplace.

“The U.S. population is far different today in terms of geographical distribution, racial and ethnic composition, age mix, family types and economic circumstance from what it was a decade ago,” said James H. Johnson Jr., co-author of the report with John D. Kasarda. Johnson is director of the Urban Investment Strategies Center at the Frank Hawkins Kenan Institute of Private Enterprise, part of UNC’s Kenan-Flagler Business School. Kasarda is director of the Kenan Institute.

The six trends are:

• South-shifting population. More than half of the nation’s population growth during the past decade (51.4 percent) occurred in Southern states, driven in part by an in-migration of an estimated 2.3 million newcomers from nearly all demographic groups – blacks, Hispanics, the elderly and the foreign born – and high fertility rates among some, particularly Hispanics.
• “Browning” of America. Nonwhites accounted for an estimated 85 percent of U.S. net population growth during the past decade. Non-Hispanic whites represented 65 percent of the U.S. population in 2009 compared to 76 percent in 1995.
• Intermarriage increase. Marriage across racial and ethnic lines has doubled since 1980, further contributing to the browning trend, with 41 percent of all intermarriages in 2008 between Hispanics and whites; 15 percent between Asians and whites; 11 percent between blacks and white; and both parties nonwhite in 16 percent of intermarriages.
• “Graying” of America. The first baby boomer born in America turned 65 on Jan. 1, sparking a “silver tsunami” of 79 million baby boomers who will exit the U.S. work force over the next 20 years. About 8,000 Americans will turn 65 every day over the next five years, and they will live longer than previous generations because of advances in health care and lifestyles that are more active.
• Gender shift. Women now hold nearly half of all paid U.S. jobs (49.8 percent), own 40 percent of all businesses and hold 43 percent of executive, administrative and managerial positions in the U.S. economy, narrowing the male-female wage gap to its lowest point in history.
• More grandparent-headed households. The number of children living in grandparent-headed households increased 26.1 percent between 2001 and 2010, compared to 3.8 percent for all U.S. household types. One or both parents also live in about two-thirds of the grandparent-headed households.

Researchers identified these trends by analyzing demographic and economic statistics compiled by the U.S. Census Bureau, Bureau of Labor Statistics, Internal Revenue Service and other government agencies from the past decade as well as other demographic research. They expect the 2010 census data to confirm these trends and provide greater detail on them.

The trends bring both opportunities and challenges for businesses, the researchers said. For instance, the South now offers the largest and most diverse consumer markets for goods and services. Aging boomers, increasingly well-educated, youth-oriented, tech-savvy and possessing more discretionary income, will drive demand for new consumer electronics and other high-technology goods and services as well as a range of products and services related to “elder care.” Meanwhile, more diverse, multicultural consumers and workers will require companies to develop new strategies for attracting customers and managing their work forces.

For the nation, an increasingly diverse work force can provide significant competitive advantage if lawmakers and policymakers respond effectively to the challenges these shifting demographics present, the researchers said. They advise the following actions:

• Approaching the process of redrawing lines for state legislatures and Congressional districts to promote economic competitiveness rather than political and electoral advantage;
• Countering the devastating impact of recent cyclical and structural changes in the U.S. economy on male employment; and
• Educating a diverse generation of primary- and secondary-age school children to build a competitive future work force.

This last – education – presents the greatest challenge and opportunity, Johnson said. “The youth at risk of falling through the cracks of our public education system are predominantly nonwhite, mainly black and Hispanic, who attend severely under-resourced and the lowest-performing schools,” Johnson said.

“Allowing these students to languish in failure factories is not only an ethical and moral issue but a major factor in our future competitiveness,” he said. “Given the huge wave of baby boomers who are about to retire, we will need the skills and talents of these younger generations to prosper in the years ahead.”

The complete report is available online.

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