Recession discouraging people from moving to Florida
March 23, 2009
GAINESVILLE, Fla. — The economic recession has cast a shadow over growth in the Sunshine State, according to the latest population projections from the , which see Florida’s population increases plunging to their lowest level in 60 years and some counties actually shrinking.
With South Florida counties particularly hard hit, the state is expected to add an average of only 37,000 residents each year between 2008 and 2010, a drop of more than 90 percent from the annual average increase during the housing boom years of 2002 to 2006, said , director of who led the research. The new report shows county population projections from 2008 to 2035.
“The collapse of the housing market and the lingering effects of what has been the worst economic crisis since the Great Depression have put a real crimp on migration and are likely to keep Florida’s population growth at very low levels for the next few years,” Smith said.
Not since the mid-1940s, when large numbers of military personnel who temporarily moved to Florida during World War II returned to their home states, has the state experienced such small population increases, Smith said. After growing by 60,000 to 80,000 per year in the late 1930s, Florida’s population swelled by 100,000 to 300,000 per year in the early 1940s, declined for two years immediately following the war and then entered a prolonged period of steady growth, he said.
The housing bust and resulting drop in home values, along with stock market declines affecting savings and retirement accounts, have made it difficult for residents nationwide to sell their homes and move to Florida, Smith said. In addition, the recession has created a loss of jobs in Florida, and employment is one of the main reasons people move to the state, he said.
While projections call for most counties to grow slowly, Smith said, 14 counties are expected to lose population during the next two years: Broward, Calhoun, Collier, Gulf, Lee, Martin, Monroe, Okaloosa, Palm Beach, Pasco, Pinellas, Putnam, Seminole and Volusia.
Since 2000 the only Florida county to lose population was Monroe, Smith said. “That’s an unusual case in that most of its land is in the Everglades, which is not developable, and most of the population is in the Keys, where there is little space to expand and the cost of living is relatively high,” he said.
Counties in South Florida are hardest hit because they expanded most during the housing boom as huge numbers of workers moved into the state to take jobs in real estate and construction and other businesses, Smith said. When the economy declined, employees left and county populations fell, he said.
“Many of the counties in North Florida had not experienced the boom to the same degree as the counties in South Florida and consequently did not experience the bust to the same degree,” he said.
As economic growth slowed and the housing market cooled, annual population growth declined from an average of 395,000 between 2000 and 2006 to 331,000 between 2006 and 2007 and 127,000 in 2007 and 2008, he said.
The effects are being felt everywhere from declining revenues from sales taxes and real estate transactions for state and local budgets to businesses experiencing a downturn from less demand for their goods and services, he said.
“As the national economy recovers and as the excess supply of housing in Florida is absorbed, we’re expecting growth to pick up again, probably within the next year or so, and then to increase to more normal levels during the next decade,” Smith said.
The only events that might stall population growth would be a prolonged economic slowdown similar to the Great Depression, which Smith believes is unlikely, or factors making the state a less desirable place to live, such as being hit by an unusually large number of hurricanes.
“I think heavy hurricane damage would have a psychological impact on people in terms of their thinking about whether to move to Florida, but perhaps more importantly it would have a strong economic effect by leading to a substantial increase in property insurance rates,” he said.