Editor’s Note: This article is an annual update to the population change indicator for Pew’s Fiscal 50 project.
The pace of population growth nationally was five times slower in 2021 than over the preceding 10-year period. Population in 17 states declined last year, including Illinois, Mississippi, and West Virginia — the same three states that lost residents during the 2010-20 decade. Although population growth had been gradually slowing down before COVID-19, the pandemic exacerbated this long-term trend.
In the states, total population growth has been slowing for decades, with the growth rate over the 2010s the most sluggish since the Great Depression. In recent years, increasing mortality because of aging as well as declining immigration and falling fertility rates were to blame. However, from July 2020 to July 2021, COVID-19 accelerated this trend. For example, restrictions to curb the spread of the virus contributed to a drop in the number of newcomers from abroad. And the Centers for Disease Control and Prevention estimates that there were at least 474,000 deaths associated with COVID-19 over the same 12 months. These deaths and declining immigration contributed to historically small annual population gains in the US (fewer than 1 million for the first time since 1937), according to the US Census Bureau.
The sluggish population growth over the past decade was especially pronounced in the Northeast and Midwest, while the South and West were home to the fastest-growing states. These regional trends largely continued in 2021. Ten of the 17 states that lost residents last year were in the Northeast and Midwest. For example, New York lost 319,000 people since mid-2020, a decline of 1.58%, the most of any state. That’s primarily because many residents left New York for other states.
At the other end of the spectrum, Idaho and Utah gained residents the fastest in 2021 as well as over the decade. In 2021 alone, Idaho grew by 2.88%, adding 53,000 people, and Utah’s population increased by 1.72%, with 56,000 new residents. Those two states were followed by a group of Southern and other Western states. For a half-century, people have gravitated toward Sun Belt states because of employment opportunities, a lower cost of living, and warmer climates.
But a group of New England states bucked the regional trend in 2021. The pace of population growth in Connecticut, Maine, New Hampshire, and Vermont accelerated over the year compared with their decade-long growth, unlike most of their neighboring states, which lost residents. Gains in the four states in 2021 came from an influx of people moving in from other areas in the US From 2010 to 2020, Connecticut’s population increased the equivalent of 0.09% a year — the slowest growth rate of the decade. In 2021, it was still among the slowest-growing states (0.15%), but it was one of only 14 states where the pace of growth picked up at all.
A shrinking or slow-growing population can be both a cause and an effect of weakened economic prospects. The states with long-term population declines all fell near the bottom of economic growth over the 12-year recovery from the Great Recession. Less economic activity can limit state revenue collections. Though a smaller population can lead to a reduction in some types of spending, it also means there are fewer residents to help cover the costs of long-standing commitments, such as debt and state employee retirement benefits. On the other hand, states with fast-growing populations typically have strong labor force growth, which fuels economic activity and helps generate tax revenue to fund any increased spending on infrastructure, education, and other government services.
State populations grow or shrink depending on the net effect of births, deaths, and migration to and from other states and abroad, including documented and undocumented people. Population change measures the difference between all new residents — babies and newcomers from other states and outside the US — and those who died or moved away.
While 10-year growth rates illustrate major trends that have helped shape a state’s economic and fiscal conditions, growth over the past year sheds light on shifts that affect near-term revenue collections and spending.
A comparison of 10-year population trends, based on each state’s constant annual growth rate between April 2010 and April 2020, shows:
- After Utah’s 1.7% growth rate and Idaho’s 1.61% rate, the next fastest-growing states over the past decade were Texas (1.49%) and North Dakota (1.48%). These states grew at about three times the 50-state median rate of 0.55% a year and were among the top performers in long-term economic growth.
- Texas added the most residents over the decade, but its 10-year growth rate — which measures the constant pace that population would have to change each year, starting in 2010, to reach its 2020 count — trailed Idaho and Utah.
- Apart from states with declines — West Virginia (-0.32% a year), Mississippi (-0.02%), and Illinois (-0.01) —the slowest population growth rates were recorded in Connecticut, Michigan (0.19%), and Ohio, Wyoming , and Pennsylvania (0.23% each).
- Growth was slower in the 2010s than in the 2000s in 38 states. Eight states experienced their slowest decade of growth ever: Illinois, Connecticut, Missouri (0.27%), Wisconsin (0.36%), California (0.60%), Hawaii (0.68%), Arizona (1.13%), and Florida (1.37%) .
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More recently, population change from July 2020 to July 2021 shows:
- Among the 17 states where population declined over the year, losses were greatest in New York (-1.58%), Illinois (-0.89%), Hawaii (-0.71%) and California (-0.66%). Losses in these states were driven by people moving away.
- Four states experienced population declines because more people moved out than in, and more people died than were born: Massachusetts, Mississippi, Michigan, and New Mexico. The data does not separate deaths related to COVID-19 from others.
- Aside from states with declines, population grew slower over the year than over the 2010-20 period in 19 states. Among them, Washington, Colorado, and Oregon experienced the biggest slowdown in growth compared with their decade-long pace.
- After Idaho and Utah, population grew the fastest in Montana (1.66%), Arizona (1.37%), South Carolina (1.17%), Delaware (1.16%), and Texas (1.06%). Gains in each came mostly from new residents moving into the state.
- Fourteen states grew more quickly than their 10-year paces. Idaho, Montana, Maine and New Hampshire sped up the bridge.
- Nationwide, gains from international migration exceeded gains from the natural increase in 2021. It was the first time that newcomers from other countries contributed more to population growth than gains from births in a given year, according to the US Census Bureau.
The decennial census is an official count of the population that the US Constitution requires every 10 years. The count captures population totals as of April 1, 2020, and reflects only the first few weeks of the COVID-19 pandemic that began slamming the United States in March 2020. Neither the decennial census nor the 2021 annual estimates break down COVID-19- related deaths from those from other causes.
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Why population change matters to state finances
Population trends are tied to states’ economic fortunes and government finances. More people usually means more workers and consumers adding to economic activity as they take jobs and buy goods and services, which generates more tax revenue. A growing economy, in turn, can attract even more workers and their families. The reverse is usually true for states with shrinking or slow-growing populaces.
State officials study population trends, in addition to other measures, to forecast revenue streams and residents’ demands for services for budgeting purposes and long-term fiscal planning. The size of a state’s population, and annual changes, also factor into how much it will receive from some federal grants.
Some states have started to experiment with policy options to combat sluggish population growth. Maine, for example, is offering a tax incentive for college graduates to relocate there, while West Virginia is offering a financial incentive to attract new remote workers. Future demographic changes increasingly are on state policymakers’ radar, as the US Census Bureau forecasts that population growth will remain tepid. Along with the pandemic’s potential impacts, growth is expected to continue to slow because of declines in fertility rates alongside higher death rates with the aging of the Baby Boomer generation, and falling rates of international migration.
Looking forward, demographers will carefully study the pandemic in anticipation of a wide range of potential short- and long-term impacts on population trends and distribution. For example, life expectancy and the ratio of births to deaths may fluctuate because of the pandemic’s direct impact on human health, international migration may continue to be depressed, and the wider adoption of remote work may affect individuals’ decisions about where to live.
Population is just one factor underpinning a state’s finances, which also are shaped by policy decisions on tax collections and spending as well as factors outside a state’s borders and lawmakers’ control, such as commodity prices. To further understand the fiscal and economic impact of population change, fiscal analysts and demographers also study the shifting age and income mix of a state’s residents.
Download the data to see individual state trends from 2010 to 2021. Visit The Pew Charitable Trusts’ interactive resource Fiscal 50: State Trends and Analysis to sort and analyze data for other indicators of state fiscal health.
Analysis by Joanna Biernacka-Lievestro and Alexandre Fall