Cliff Diving and Curb Jumping

Take a look at any economic indicator lately, and you're likely to swoon as the trend line veers into a vertical plunge. This is called cliff diving. It is a common sport in economics, but rare in demographics. Demographic change is slow and steady. Demographic trends rarely dive off cliffs, but they occasionally jump off curbs. Case in point: the latest geographic mobility statistics.

Last week the Census Bureau reported that only 11.9 percent of the population moved from one house to another between 2007 and 2008--the lowest proportion ever recorded in data that has been collected since the late 1940s. The number of people who moved--35 million--was the smallest since 1959-60.

Given the dire situation in the housing market, these numbers are not surprising. Homeowners are stuck and even renters aren't moving around as much as they once did. In 2007-08, only 5.4 percent of homeowners moved, down from 6.6 percent the year before and 7.4 percent in 2000-01. Among renters, 27.7 moved between 2007-08, down from 29.3 percent a year earlier and 30.3 percent in 2000-01.

State-to-state migration has been severely curtailed. The number of people moving from one state to another fell by 39 percent between 2000-01 and 2007-08, shrinking by 3 million.

By age, the largest proportionate drop in mobility has occurred among people aged 60 to 61--an age group once filled with retirees. In 2007-08, only 4.7 percent of 60-to-61-year-olds moved, down from 7.6 percent in 2000-01.

If you really want to know how the priorities of Americans are changing, then take a look at their reasons for moving and how those have changed over the past few years.

• Not buying: The number of people who moved because they wanted to buy a home fell by 48 percent, from 3.9 million in 2000-01 to just 2.0 million in 2007-08--the largest decline among all reasons for moving. While there probably is some pent up demand for buying a home, it is possible that many Americans are reconsidering the importance of ownership now that they know the risks.
• Moving closer to work: The number of people who moved to shorten their commute increased by 80 percent between 2000-01 and 2007-08, rising from 1.2 to 2.2 million--an 80 percent rise and the largest increase among all reasons for moving. This is bad news for the far-flung suburbs, which will be last in line for any economic recovery.
• Delaying retirement: The sharp drop in the mobility of 60-to-61-year-olds is reflected in the 38 percent decline in the percentage of people who moved because of retirement between 2000-01 and 2007-08. Retirement savings have been decimated and the age of retirement is rising, which is why state-to-state migration has plunged. This trend could gut destination retirement areas.
• Staying closer to home: The data show an ominous decline in the number of young adults who moved to attend or leave college, with the figure falling by 26 percent between 2000-01 and 2007-08. This decline is occurring as a growing proportion of students opt for less-expensive in-state public schools and is yet another warning sign for the nation's overpriced private colleges.
• Downscaling expectations: The percentage of people who moved because they wanted cheaper housing climbed by 35 percent between 2000-01 and 2007-08. At the same time, the percentage who moved because they wanted a better home or apartment fell by 29 percent.

Americans are dropping out of the housing market, delaying retirement, and downscaling their expectations for college and home. These trends may be temporary, but the best way to survive them is to assume they are permanent.

Why Aren't More Upset about Shoddy Health Care Coverage?

Where are the pitchforks? Where are the "tea parties" to protest our broken health insurance system? A look at the demographics of health insurance coverage reveals the answer: The percentage of adults who must make do with the ludicrously expensive and inadequate private health insurance system is relatively small. Here is the breakdown for 2007, the latest data available:

Total population: 299 million
Medicaid: 40 million
Medicare: 41 million
Military health care: 11 million
Uninsured: 46 million
Children with private health insurance: 44 million
Elderly with private health insurance: 13 million

Subtract all those people as potential constituents for health insurance reform, and that leaves 105 million--or just 35 percent of the population--who are struggling. And the percentage is even smaller if you also subtract the few who have top-quality private health insurance--such as teachers, senators, and congressional representatives. Little known fact: each member of Congress receives health insurance for life after serving only five years in office. This goes a long way toward explaining their "What, me worry?" attitude.

So, only about one-third of Americans are experiencing the full force of the broken health insurance system. Good luck with that.

Retirement Confidence Plummets

Percentage of American workers who are "very confident" they will have enough money to live comfortably in retirement: 13.

Source: Employee Benefit Research Institute, 2009 Retirement Confidence Survey