Population growth slows in Arizona, Pima County
by Multiple Authors on Dec. 11, 2008, under Local, SpecialPopulation rose 1.6% in past year; smallest gain since 1990
Arizona’s population is expanding at the slowest rate since the 1990 real-estate-led recession, and Pima County is included, new figures show.
For the first time in decades, the state’s growth is being driven by births instead of people moving here.
Arizona’s population grew by 1.6 percent, or about 100,000 residents, during the fiscal year that ended June 30, according to U.S. Census Bureau data analyzed by University of Arizona economist Marshall J. Vest. That’s less than half the growth rate of two years ago.
Pima County’s growth was even slower – a 1.3 percent increase over 2007, or about 12,400 people, Vest said Wednesday.
About 6.5 million people live in Arizona.
Fewer people moving to Arizona means fewer potential home buyers, fewer shoppers in new stores and less money for cities that depend on sales tax revenue.
“Arizona is the state where growth is good and too much is just right,” Vest said, joking.
“Because we’ve experienced so much growth and we’ve planned for that growth, when that growth slows down, people are put out of work,” Vest said. “The rate at which we are absorbing vacant houses has really slowed and that means we can’t build more houses. The home-building industry has fallen off 80 percent in the past three years.”
Most of the state’s population growth is due to a “natural increase,” Vest said, the number of births minus the number of deaths. That is a reversal from the massive growth Arizona saw due to people migrating here during the housing boom of 2005-06.
“You see migration really slowing down now and that has to do with the economy and the fact that people can’t sell their houses in other parts of the country,” Vest said.
Vest estimated that 20,000 to 25,000 of Arizona’s 100,000 newest residents are the result of net migration, the number of people who move here minus the number of people who move out of state. That compares with a conservative net migration estimate of 140,000 to 160,000 during 2005-06.
In Pima County, Vest estimated that 6,000 of the 12,400 new residents in 2008 were from net migration, compared to a net migration of 12,300 in 2007.
The remainder were births. Even though births have begun to slow in Arizona, as they have during every recession since the 1970s, they surpass deaths.
Vest’s forecast for the 2009 fiscal year is that the state will grow by 1.2 percent, or 80,000 people. He thinks Pima County will grow by about 11,100 people, or 1.1 percent.
Slowing population growth is a negative overall when looking at economics because fewer people working means fewer tax dollars to support the state’s needs. But on the positive side, Vest said, “You could argue the environmental side: that we’re not using up the land or the natural resources as quickly.”
Arizona’s growth rate last dropped below 2 percent in 1990. That year, the state population expanded by 1.7 percent, and while Vest didn’t have specific numbers for that year immediately available for Pima County, he said the county’s numbers usually track with the state’s.
Vest’s numbers are only estimates because the yearly census data from the state are not released until four or five months after the end of the fiscal year.
He said his estimates have been accurate for the decade he’s been doing economic forecasts for the state’s business and public policy leaders.
In the next few weeks, a population study commissioned by the Central Arizona Association of Governments, using a new and improved model for tracking growth, is expected to be completed. Vest and Arizona State University economist Dennis Hoffman have worked on the study of Pinal County for a year.
Economists say we won’t know for sure how much population projections were inflated by the housing boom and how much Arizona’s growth is slowing until the 2010 census.
The remaining population growth in the coming fiscal year will be about 55,000 people. That will be “natural” growth, which refers to the number of births, once deaths are subtracted, Vest believes.
Marshall Vest
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Economic forecast
The University of Arizona Eller College of Management will hold its 2009-10 economic outlook luncheon at noon Friday at The Westin La Paloma Resort & Spa, 3800 E. Sunrise Drive. For reservations, call 626-9137.
By The Arizona Republic, Renee Schafer Horton
