A new Census report finds that the percentage of Americans who are changing residences has dropped to an all-time low. Just 11.6 percent of Americans moved last year, down from 12.5 percent in 2009 and way down from 18.6 percent in 1987. In fact, the Census tables show that geographic mobility has been declining steadily since the end of World War II, when one-fifth of all Americans regularly moved. Why is this?
There are a couple of things going on here. As Catherine Rampell observes, much of the current drop has been driven by a decline in people switching homes within counties. For that, blame the housing bust. Foreclosures and falling prices have caused home sales to plummet. Notice that many of the states that have historically seen the most churn — such as Florida, California, Arizona, and Nevada — were the states that were hammered by the subprime crisis:
But that’s not the only reason. There’s also been a marked drop in Americans who move long distances — and across state lines — to seek out new jobs. A huge part of the story is that there just aren’t as many new jobs available these days. But it’s also possible that people are locked into their homes. The Census found that people living in rental units were 4.7 times more likely to move than those who owned homes.
As UCLA economist Hernan Winkler has found, the transaction costs associated with selling a house can be a big barrier to mobility. There’s also the fact that roughly a quarter of Americans now have underwater mortgages — owing more than the market value of their homes — which can prevent them from moving (though Adam Ozimek argues that falling home prices probably aren’t holding back employment).
Last year, the New York Times convened a bunch of academics to thrash out why geographic mobility is on the wane. Princeton sociologist Katherine Newman argued that people are more likely to stay near friends and family during recessions, since existing social networks and support systems become especially crucial. But longer-term trends may be at work here, too. Harvard’s Lawrence Katz, for instance, points to simple demography: As the baby boom generation ages, America is getting older, and hence less likely to move.
Posted by Brad Plumer, 11/15/2011