In half of all states last year, more people died than were born, up from five states in 2019. Early estimates show the total U.S. population grew 0.35% for the year ended July 1, 2020, the lowest ever documented, and growth is expected to remain near flat this year.
Some demographers cite an outside chance the population could shrink for the first time on record. Population growth is an important influence on the size of the labor market and a country’s fiscal and economic strength.
The phenomenon is most acute in rural America, where small towns and lightly populated counties often lack the jobs, housing and child-care options young families need. The combination of aging residents and fewer young people in such counties has helped push deaths higher on average than births for the past eight years, according to the estimates.
Historically, nearly half of the country’s economic growth has been driven by the expansion of the working-age population, including immigrants, said Neil Howe, an economist, demographer and managing director at Hedgeye Risk Management, an investor-oriented research company. Recent federal-budget projections suggest the potential labor-force growth rate will hover just above zero for years to come, down from a range of 2.5% starting in the mid-1970s to 0.5% from 2008 through last year.
The shifts will make the U.S. more reliant on immigration to grow the workforce, economists say, although that faces its own pressures. Mexico’s fertility rate has steadily declined, while China and India—two other top suppliers of immigrants to the U.S.—face talent shortages of their own, along with China’s own flattening population growth.