Census Reveals Effects Of Recession On U.S.
REBECCA ROBERTS, host:
This is TALK OF THE NATION. I'm Rebecca Roberts in Washington. If you're feeling squeezed when you write your rent check, and it seems like everyone you know is struggling, if you could swear your commute is even taking longer, no it is not all in your head. New data from the US Census Bureau confirms the squeeze is real and you're not alone.
The latest census numbers released yesterday offer a broad snapshot of how families and three million American households lived their lives in 2008. And the data reinforce what many of us were already feeling: Median income has fallen in many states, home ownership is at its lowest level in six years, fewer Americans are moving and one in three adults has never been married - the highest level in a decade.
How about you? Has the recession changed how you live your life or the choices you're making about your future? Give us a call, 800-989-8255. Our e-mail address is firstname.lastname@example.org. And you can join the conversation at our Web site. Go to npr.org and click on TALK OF THE NATION.
With us now is William Frey. He's a demographer and senior fellow at the Brookings Institution. He joins us from their studio in Washington. Thanks for coming to TALK OF THE NATION.
Dr. WILLIAM FREY (Demographer and Senior Fellow, The Brookings Institution): Well, it's good to be with you, Rebecca.
ROBERTS: So, looking at these numbers in a broad sense, what do they tell us about how the recession is changing the way we live?
Dr. FREY: Well, they tell us in a little more graphic detail something we already knew. We had a pretty bad year in this country.
(Soundbite of laughter)
Dr. FREY: And, of course, these are numbers from the 2008 American Community Survey, a new - relatively new survey for the Census. It's been in the business for about three years. But it does have the very strong virtue of giving us a very clear picture of what's going on in a year-to-year basis. And what we see from the numbers, as you say, people stopped moving a lot around because they're not able to sell their house, or even if they could, they weren't able to get a mortgage to buy a new one.
People have - there's been a downturn in the rate of homeownership. A lot of people have, you know, been foreclosed upon. It's gone down from about 67 percent to 66 percent - doesn't sound like a big decline but it's been going up for many years up until then. People are less likely to be married of all things.
(Soundbite of laughter)
Dr. FREY: Now, I'm not sure you would chalk that up totally to the economy, but it has something to do with young people sort of waiting out their 20's and maybe even early 30's before they make that big decision because they are concerned about the long-term economic circumstances.
ROBERTS: Do you know what I thought was interesting about that statistic was not that people are waiting longer to get married as a general trend - because I don't think that's news - but that the idea of adults who have never been married had been holding steady at about 27 percent for the last eight or nine years. And so, this increase really is a jump.
Dr. FREY: Yes. I think that's right. And, you know, as I like to tell people - and people don't just look at the stock market and then decide they're not going to get married or they are going to get married, but there is something about the broader economy that makes people a little bit more intimidated about making that big step because they know, you know, all of the kinds of responsibilities they're going to have in terms of perhaps buying a home, making a commitment toward a job which may not be there for them. And so, you know, there is something about the economy in there. But I think a lot of it is generational too. It's two things happening together and, you know, it may even be higher next year, who knows, especially we know the economy is going.
And then, of course, there is the decline in people who are driving to work alone. More people are taking public transportation. People are taking longer to commute because they are taking public transportation or are carpooling because it takes a longer period of time. All of these are indicators that people are trying to stretch whatever resources that they have or are kept from engaging in something like homeownership.
Perhaps one of the most telling statistics that we've seen this year is that for the first time in almost 70 years, the foreign-born population in the United States has either stayed steady or declined and - depending on how you want to read the statistics - but it has not gained as it has been doing for every year since about 1970. So we're seeing a country that not only people are standing still and holding tight within the country, but folks who are normally ready to come in from outside to improve their lot, to get jobs, to, you know, pursue their dream in the United States, they, too, are being a little bit cautious about this.
ROBERTS: And what groups account for that drop?
Dr. FREY: Well, I think the biggest group accounting for that drop are people born in Mexico. When you look at the change in the foreign-born population, there's a decline of over 300,000 people who are born in Mexico - if you look at the Mexican-born people this year compared with the Mexican-born people last year - and especially more of the low-skilled members of the Mexican-born community. They're not the only country that shows that drop, but they are by far the biggest one. And, you know, the states where you see that drop occurring most are California, Arizona, Nevada, states that are, of course, close to the Mexican border, states that had a lot of low-income jobs available to Mexican immigrants and Mexican workers.
When the economy started to turn around, especially when the bubble burst - the housing bubble burst in a lot of those fast-growing states in the West -probably the first to leave would have been these tenuous Mexican employees. And many of them, maybe they've gone back to Mexico, but I think what these statistics also show is fewer people are coming in because they realize those jobs aren't there.
ROBERTS: My guest is William Frey, a demographer and senior fellow at the Brookings Institution. We are talking about new data from the census.
Let's hear from Paul in Kalamazoo, Michigan. Paul, welcome to TALK OF THE NATION.
PAUL (Caller): Hi. How are you doing?
ROBERTS: Good. How are you?
PAUL: Fantastic. Listen, I just was calling to mention the squeeze, as far as it - how it relates to myself. I began a job this summer as an ice cream truck driver, you know, with the music and all that. I was a big rig driver before that, looking for local jobs here in Michigan, and just there are none. So, I can definitely feel that. I got married in May. But - and speaking to what you're talking about before, we didn't go through the legal proceedings, just at the religious level.
ROBERTS: So, how tired are you of the calliope songs in your ice cream truck?
PAUL: Oh, it's amazing. You can't even imagine what it's like to drive for eight hours and make $18 and be happy about that, just because I know that I can squeak by, which is pretty much most days, as some days about 40 or $50 on a really good day.
ROBERTS: And, Paul, do you see that as sort of a temporary situation? Do you think you'll get back into big rig driving? Or do you think this is the new normal?
PAUL: I'll be back to driving as soon as possible. But from what I hear from NPR, it's something it's not going be till end of next summer, which seems like it's going to get a lot worse in Michigan before it gets better.
ROBERTS: Paul, thanks so much for your call. You know, William Frey, you know, this is a snapshot of the last year, and it's hard to know where the trend's going without the next chapter.
Dr. FREY: Yeah. And I think the real question is? What's the new normal for a lot of people who are experiencing a very different living situation now than they were used to during the sort of more prosperous years of this decade? And it's hard to say. I mean, a lot of the backdrop for this is the housing market, where it's still difficult for a good number of people to get a loan, to get a mortgage, and it's difficult for people to sell their homes. That's the backdrop. And then on top of that, of course, we have this economic recession, which is much more nationwide than a lot of our earlier recessions. In other words, in some of the earlier periods, there were specific parts of the country that were hard hit, but not generally in the country as a whole.
Now, for sure, there are states that are doing not too well. And I think Michigan is a good example because of the long-term decline in the industrial -in the car industry and other industries in Michigan. But, you know, states like Florida and Nevada have had big downturns, too, and they're not known for being states that have - low in migration or a lack of jobs. And so, I think the one-two punch of the housing market and the job market - we don't really know at this point where the end of that tunnel's going to be. And I should say that these statistics that we're talking about that were released today by the U.S. Census Bureau for the year 2008, we know that when they come out for the year of 2009, which we're two-thirds, three-quarters the way through, you know, they're probably going to be just as dismal, I hate to say.
ROBERTS: And I - going back to that home prices statistic, you said things were looking down in Nevada and Florida. Along with California, those are the three states with the biggest declines in home prices. The median home prices actually rose in Texas, Utah, Wyoming, Oregon, Pennsylvania, Tennessee and North Carolina.
Dr. FREY: Yeah. There are states which did not sort of - they had not been affected by, you know, the easy lending and the things that created that bubble in places like Nevada and Arizona nearly as much. I think Texas, the loans and the banking system had things a little bit more under control due to some problems that they had a decade or two ago. And, you know, it's an economically prosperous state compared to a lot of these other states we're talking about. And I think that's also the case with some of the other states you've mentioned.
ROBERTS: Let's hear from Tara in Phoenix, Arizona. Welcome to TALK OF THE NATION.
TARA (Caller): Yeah. I'm calling - my state cut the reimbursement rates for my particular job - I work with children with development disabilities - by 45 percent. I have to break my lease and move into some friend's spare room. So I'm basically living in their office space. But I have the same job, so I'm now commuting all the way across the valley.
ROBERTS: And so, this was a state budget cut that affected your weekly income?
TARA: Yeah. And what's sad is I had just finished my degree, so I'm, you know, getting the same pay rate that I got before I got my degree now.
ROBERTS: And, Tara, where do you think things are going for you? Are you able to save some money by living with friends?
TARA: I'm not able to save enough. I'm still barely covering my monthly expenses.
ROBERTS: Tara, thanks for your call. Well, from the couple of calls we've taken so far, William Frey, it would certainly seem like the next year's numbers are not going to be any better.
Dr. FREY: Yeah. I think that's right. And, you know, I think what the caller points out is one of - you know, it's like a double and triple-barreled defect on things that affect people's lives and their livelihood, and that is states and local communities which were used to getting, you know, a reasonable income from taxes on property and light kinds of taxes aren't able to recoup that kind of tax anymore. And as a result, they have to - if you're working for the state or getting some kind of state subsidy, that's getting cut out, as well. So that on top of everything else is hitting people. And, I mean, the caller was hit with almost everything: a reduced income, leaving their home, a longer commute. I mean, this is what we see in all of these census statistics.
ROBERTS: And median income is down nationally.
Dr. FREY: Yes, that's right as well. So - and as we pointed out, it differs in some places. But that's true. And when we have a national downturn in median income and then even more hard-hit places, you know, that makes things quite difficult.
ROBERTS: You're listening to TALK OF THE NATION from NPR News. Let's hear from Jeff in Bend, Oregon. Jeff, welcome to the TALK OF THE NATION.
JEFF (Caller): Hi. Yeah. I'm calling because I basically have been working as an EMT ski patroller/fly fishing guide for the last, I don't know, between 19 and 16 years, depending on which job you look at. And for the last seven years, I've received about $.50 raise per hour as the EMT. And so, basically, I've been losing money over the last seven years. And now I've got to go back to school. So I'm unable to make enough money.
ROBERTS: Why do you need to go back to school, do you think?
JEFF: Because there's - I don't see corporate America raising my pay rate.
ROBERTS: What are you going to go study?
JEFF: I'm going to study in the nursing career. So I've just started, as of yesterday.
(Soundbite of laughter)
ROBERTS: Well, congratulations. Thanks for your call.
ROBERTS: Well, the - changing careers or going back to school is certainly something people do in recession, but they don't seem to be moving houses or moving states very much. It seems like people are pretty much staying put.
Dr. FREY: Yes, that's absolutely correct. I mean, numbers even before these numbers that came out yesterday - came out earlier this year showed that we have the lowest rate of migration in the United States since we've been collecting these statistics at the end of World War II. And it's the lowest rate of moving long distance from state to state or metropolitan area to metropolitan area. And it's the lowest for moving locally, moving across town. And, you know, as I said earlier, the freeze in credit has put everybody standing still in terms of the housing market. And then on top of it, the jobs aren't there in other places that they may be able to go to.
But this is a country where part of what keeps our economy going is the migration of people, the migration of employers. And, you know, in this sort of standstill, it puts us in a difficult situation, especially in states like Florida. They might - Florida had an out migration last year.
Dr. FREY: No one would have ever predicted that two or three years ago.
ROBERTS: Let's hear from Alison(ph) in Rapid City, South Dakota. Alison, welcome to TALK OF THE NATION.
ALISON (Caller): Hi.
ALISON: I was just listening, and how you had said that statistics are that people are waiting to get married, which was interesting. In my case, I - we've been together for seven years, me and my fiance, and have decided to finally get married at the end of October. And I had been employed for the entire time making $16 an hour, and my position was eliminated. And now I'm temping for $8 an hour. And getting married, to me, is another sense of security, one thing that I can rely on. And I that's why I personally chose to finish and get married instead of waiting.
ROBERTS: Alison, thanks for your call.
That's an interesting perspective that actually getting married is something that adds economic security in the - as opposed to something you put off until you have more economic security.
Dr. FREY: Yes. I think people make choices in their individual circumstances, which they perceive is making them feel more secure. And I think that choice is a good one. I mean, there have been studies done in the past during economic downturns and during the Great Depression that showed that, you know, people stayed in marriages because they couldn't afford to get divorced. So, it works the other way as well, because you need extra income if the couple's going to split. And so it works in a lot of different directions. But I think as we discussed earlier with these statistics, a lot of young people are waiting a little longer in this particular environment.
ROBERTS: Let's hear from Kate(ph) in Wrentham, Massachusetts. Kate, welcome to TALK OF THE NATION.
KATE (Caller): Hi, and thanks for taking my call. I - my husband and I have been negatively affected by the economy. My husband was a contractor, not self-employed, but employed by someone else. And he can't find a job. His pay rate would be cut minimum of a third, which is a pretty significant amount of money. And I'm working two jobs myself. And so, as he - and our income won't even be half of what we made last year.
ROBERTS: And what do you do?
KATE: I actually - funnily enough, based on the prior conversation about higher education - I finished my master's degree with the hope of changing careers, and that's clearly not happening in this economy.
ROBERTS: Kate, thanks for…
KATE: Right now, I'm a paralegal.
ROBERTS: Thanks for your call. So this has been a fairly bleak 17 minutes.
(Soundbite of laughter)
ROBERTS: William Frey, is there any positive news in this data?
(Soundbite of laughter)
Dr. FREY: Well, I mean, we've always know where we've had - when we've had economic downturns, things have turned around. And I think a lot of the people who have called have made kind of temporary decisions about their lives, not necessarily permanent ones. And so I think that's the way we need to think about this economic malaise. This, too, will pass. And when it does pass, you know, I think people will - Americans are resilient, and they'll pick up and they'll keep going ahead.
ROBERTS: William Frey is a demographer and a senior fellow at the Brookings Institution. He joined us today from their studio in Washington, D.C. Thanks so much.
Dr. FREY: Sure. I enjoyed it.
ROBERTS: Tomorrow, searching for the meaning of life in advertising. Former ad man James Othmer ponders the moral quandaries and the thrill of the ad business. Neal Conan will be back for that conversation.
I'm Rebecca Roberts. This is TALK OF THE NATION from NPR News.
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