Slowing migration

About six months ago, I wrote a post discussing the link between high unemployment and low labor force mobility. In that post, I pointed out that our paradoxically declining labor force mobility (telecommuting and the internet should be making us more mobile, not less so) was a huge driver behind slowing economic growth and increased unemployment.

Recently released Census data indicates that it's a trend that isn't improving, a dynamic that should give us pause if we're expecting a robust economic recovery.

Domestic migration last year reached its lowest level since the government began tracking it in the 1940s, the Census Bureau said, as the lingering effects of the recession continued to curb Americans’ mobility.

About 10.5 million Americans changed counties from 2009 to 2010, or about 3.5 percent of the population, the lowest percentage since 1947, when the government first started tracking the numbers, according to census data released this week.

It was fewer than the 11 million who moved the previous year, and down by a third from the 15.8 million who moved from 2004 to 2005, when the economy was doing well.

The number caps a decade whose final years had steep declines in migration, as the recession and effects of the housing crisis continue to freeze Americans in place.

One dynamic that I don't think the Times article picks up on is the fact that the decreasing mobility is in fact deepening the economic recession that the authors claim caused the decrease in mobility in the first place. That reciprocal relationship has the potential to create a devastating vicious circle, from which our economy could have a very difficult time recovering.

The old view of the "American Dream" was to own a house and raise a family and grow old there, but increasingly it's seeming like the pursuit of that dream is hamstringing people throughout the country. For many, a house has become an anchor more so than anything else, weighing families down and limiting their opportunities and economic capabilities. It's a terrible irony, and it would behoove our government to recognize that their irrepressible push for homeownership is now proving to be a net negative for the economy at large.

I wrote earlier this week about how the problem with innovation in America isn't that Americans aren't innovating, it's that they aren't fully adopting the new technologies that have been made available to them. I think that our decreasing mobility is a particularly ironic and damaging example of our lack of adoption, since the internet should by all means be increasing our mobility, allowing us all to work from anywhere at any time. Instead, there's an incredible mismatch between workers and job opportunities, and economic growth suffers as a result.

We shouldn't be in this quandary, and yet here we are. The question is, how do we get out of here?

[NY Times]