We now live in a nation of more than 300 million people. A population of this size must have seemed like a remote possibility in 1967, when we passed the 200 million mark. It must have been almost inconceivable in 1915, when we were at 100 million.
We’ve changed considerably since we were a nation of 200 million. And we’ll probably be even more different by 2050, the year in which the U.S. population is expected to reach 400 million.
By considering demographic trends, you can gain a glimpse of what our future might look like.
Big and Spread Out
Anyone who has examined the American landscape during a coast-to-coast flight knows that the United States remains a vast open space. The state of Texas alone is so big that if all 300 million U.S. residents moved there and claimed a half-acre per person, there would still be more than 32,000 square miles left unoccupied. Alaska has enough land for each person to claim 1.25 acres.
Since 1970, the majority of the population has moved out of the Northeast and Midwest and now lives in the South and the West. More than half of the population live in metropolitan suburbs, compared with 38% in 1970. Only about 30% currently live in-central cities.
Going forward, the population is expected to spread out even more as technology makes it possible to work from anywhere and real estate in populous cities becomes more expensive. Eighty percent of Americans say they prefer single-family homes over apartments, and nearly one in three wants to move to the country or a less-populated environment.
Aging But Not Old
The U.S. population may be aging, but the age-related problems we face are not nearly as serious as those facing other developed nations. Our population is growing much faster than those of South Korea, Britain, Russia, and China, and the growth is expected to continue for at least the next 50 years. During the same period, Japan and several European nations will see their populations decline from 10% to 25%. The Cold War-era Soviet Union was more populous than the United States, yet by 2050 the Russian population will barely equal one-third of the U.S. population.
A large elderly population and a dearth of young people can cause economic problems, such as a dwindling workforce, falling tax revenues, and extreme pressures on health and pension systems. As our competitors in the global marketplace see their populations stagnate and begin to shrink, foreign and domestic investors may continue to prefer the opportunities created by our growing population.
“Demography is the future that already happened,” management guru Peter Drucker once remarked. Keeping an eye on demographic trends may provide useful clues about the future of your portfolio.