Americans on Move Buoying Economy With Mobility Rebound
Danielle Anderson landed a promotion in June that required her to move from southern California to Houston, where she bought a $280,000 townhouse near downtown. Since then, the 24-year-old sales and marketing manager has spent $8,000 on furnishings, hooked up cable television and hired a gardener.
The number of Americans moving has started to increase from a record low, promising a lift to the labor-market recovery as well as housing and consumer spending. An estimated 12 percent of U.S. residents moved in the year ended March 2012, up from a 63-year low of 11.6 percent the prior year, according to an analysis of unpublished Census Bureau data by the Population Reference Bureau, a Washington-based research organization. About 1.7 percent moved from one state to another, the most in five years, the data show.
Mobility adds flexibility to the labor market, allowing employers to fill positions more easily when skills may be in short supply. A lack of migration the past few years helps to explain why 3.6 million jobs were unfilled in August -- 719,000 more than in January 2009 when unemployment last matched September’s 7.8 percent, Labor Department data show.
“Increased mobility will facilitate a quicker improvement in the job market, as the unemployed and underemployed can more easily move to where the jobs are,” said Mark Zandi, chief economist at Moody’s Analytics Inc. in West Chester, Pennsylvania. “I would expect mobility to steadily improve going forward as job opportunities and house prices increase.”
Migration is an “encouraging trend” for the labor market, Federal Reserve Bank of St. Louis President James Bullard told reporters Oct. 15 after a speech. It has been a historical strength for the U.S. versus Europe, where moves are hampered by language differences, Bullard said.
“Boom areas” that have benefited from energy production, including Texas and North Dakota, are drawing more job hunters, he added.
Increased hiring and mobility support each other, said Wells Fargo Securities LLC senior economist Mark Vitner in Charlotte, North Carolina. He forecasts “both job growth and mobility increasing modestly over the next five years, bringing us back to prevailing levels” that existed in 2007 by 2016 or 2017.
The aging of the U.S. population hinders a return to the 1960s when as much as 20 percent of the population moved in some years, according to demographer Mark Mather, associate vice president for domestic programs, at the population bureau.
People ages 25 to 29 are twice as likely to move as the total population. Yet even younger people aren’t as mobile as previous generations because the labor market is impaired: About 25 percent of people in this age group moved last year, down from 30 percent in 2001, Mather said.
Still, there are signs that more Americans are changing locations. Shipments handled by moving companies rose 1.5 percent in the first half of 2012 after a 1 percent gain in 2011, according to the American Moving & Storage Association in Alexandria, Virginia. Volume fell by 10 percent in 2008 and 15 percent in 2009. “There is a pent-up demand” for moves, which is “obviously closely tied to housing,” organization spokesman John Bisney said.
Kristen Keese, 22, a marketing graduate from the University of South Florida in Tampa, moved to New York City to take a job as a research analyst for Nielsen Holdings NV (NLSN) in September after a job search that included the Tampa area, Chicago, Los Angeles and New York.
“The fact I was willing to move anywhere for a company I wanted to work for or a job I loved, I think that is something a lot of companies are attracted to,” she said. “I am single. I am flexible. I am just getting into the corporate world.”
A rise in home prices this year for the first time since 2006 is allowing more homeowners to sell and move, said Brad Hunter, chief economist in Palm Beach Gardens, Florida, for Metrostudy, a Houston-based company that tracks housing starts. About 1.3 million borrowers saw the value of their homes exceed their mortgages in the first half of the year, becoming “above water,” according to Santa Ana, California-based data provider CoreLogic Inc. (CLGX)
Housing starts in the U.S. surged 15 percent in September to the highest level in four years, Commerce Department figures showed Oct. 17.
Mobility is “clearly good news for the housing industry and Realtors,” said Charles Lieberman, chief investment officer with Advisors Capital Management LLC in Hasbrouck Heights, New Jersey. “Homeowners invariably spend much more money on improvements, decorating and other such stuff after they move.”
Texas had eight of the 15 fastest growing large cities between April 1, 2010, and July 1, 2011, with Denver, New Orleans and Tampa also among the population leaders, according to Census figures.
San Antonio and Austin “are arguably two of the best real- estate markets in the country,” Los Angeles-based KB Home (KBH) Chief Executive Officer Jeffrey Mezger said in a conference call in September. “The markets remain solid in Houston, Dallas-Fort Worth and Denver as well.”
The gain in mobility, while modest, “is an encouraging sign, especially for interstate moves,” said William Frey, a demographer at the Brookings Institution in Washington. “It means young people are beginning to dig out of the trenches and may be able to go on with their lives, relocating to new jobs and getting into homes of their own.”
Stephen Hom, 26, who last month took a job at General Electric Co. (GE) after moving to Houston as part of its engineering training program, said he’s encountered recent grads from Virginia, Florida and Wisconsin attracted to the city by opportunities in the energy field.
“There is an influx of people coming from out of state,” he said. “This is a big energy city and a lot of companies are looking to hire.”
Bemetra Simmons, 37, took a job at BB&T Corp. (BBT) as an area executive in Tampa after working in a similar job at the regional bank in the smaller market of Decatur, Georgia. Population growth in Florida probably will rise to 1.7 percent a year by 2015 from an estimated 1.2 percent this year, said Sean Snaith, economist with the University of Central Florida in Orlando.
Anderson, 24, says she runs into newcomers in Houston frequently around her home near Memorial Park, where she can bike, run and play volleyball. To advance in her sales career, Anderson says she has to be flexible.
“If there is a promotional opportunity, you need to be able to move,” she said. “I will probably move again.”
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