California growth boom out of steam

Published: Friday, Feb. 1, 2013 - 1:15 pm | Page 1A
Last Modified: Thursday, Feb. 13, 2014 - 11:34 am

California's long run as a boom state will sputter to an end as population growth rates consistently fall below 1 percent a year in the coming decades, according to state Department of Finance projections released Thursday.

The trend has already started. For the last several years, more residents have left California for other states than arrived from them, birth rates have declined and foreign immigration has slowed.

As the nation's most populous state, California will continue to add a lot of people – about 300,000 residents per year, on average, through 2060 – but the rate of growth will be akin to places that Americans have historically left behind to try their luck here.

The Sacramento region will grow slightly faster than the state as a whole, but also will see a sharp decline in growth rates from previous decades, according to the new projections.

Population growth has historically fed the California and Sacramento economies, increasing demand for everything from housing to health care. If growth stalls, it will be harder for the state to recover quickly from the recent recession, said Jeff Michael, director of the Business Forecasting Center at the University of the Pacific.

"This would represent a very significant slowdown in the long-term growth rates," he said. "It has real implications first and foremost for the housing market, for the construction sector and all areas of the service sector."

Many will nonetheless welcome a pause. As Michael and others noted, population growth has also fed the sprawl, traffic and pollution that have diminished the state's reputation.

A slowdown could give California and Sacramento breathing room to make significant changes and grow smarter, said Alex Kelter, former president of the Environmental Council of Sacramento.

"We need to do a whole lot better, particularly outside the incorporated areas," he said. "This will give us a good chance to step back."

Bill Schooling directs the research unit that compiled the population projections, using assumptions about birth rates, death rates and migration patterns. He said the new figures do not signal a crisis.

California is a huge state, which means it can add a lot of people with only a small rate of growth, he said. Even with average growth rates below 1 percent, it will add about 15 million residents during the next 50 years, more people than currently reside in Pennsylvania or Illinois.

The population boom of the last several decades was unsustainable, Schooling said, and there will be enough people still coming to support the state's economy.

In the short run, the state will even see a slight uptick in growth rates by 2020 from current levels before another decline, Schooling said.

"California is still a young, dynamic state, and we are still growing," he said.

Much of the growth that does occur in the coming decades will be driven by sharp increases in the number of Latinos and Asians. By next year, Latinos will be the largest ethnic group in California, surpassing whites.

The San Joaquin Valley, which is already home to millions of Latinos and Asians, will be the largest exception to the slow-growth trend seen elsewhere.

Fresno County will grow by 75 percent during the next five decades, as its Latino population roughly doubles. Stanislaus County will have more people than either San Francisco or San Mateo counties by 2060, with Latinos accounting for two-thirds of the county's growth.

Closer to home, the Sacramento region's population will rise, on average, about 0.9 percent a year through 2060, according to the Department of Finance, compared with 0.7 percent a year statewide.

That's a far cry from the region's recent history of growth.

During the previous two decades, the four-county region's population increased by 45 percent. During the next two decades, it will increase by about 22 percent.

In Elk Grove, which incorporated as a city in 2000, the double-digit rate of growth eight years ago was so brisk that census figures showed it was the fastest-growing city in the nation.

Last year, the city's population grew by 1 percent.

"What's most alarming is the lack of business," said longtime Elk Grove City Councilman Jim Cooper. "We have a housing and job imbalance that we've been trying to rectify."

Placer County Supervisor Kirk Uhler, who lives in Roseville, sees too many people leaving California for other states. Many of those left behind, he said, are older or poorer residents dependent on expensive government services.

"For those of us in local government, it's a horrifying thought," he said. "It's a shrinking of the economic base."

The most visible recent sign of the slowdown in growth is the announcement by Sacramento City Unified School District officials that they may close 11 schools due to declining enrollment.

Because of the aging of the urban population, said district spokesman Gabe Ross, the district has lost 10 percent of its enrollment in the past decade, with 47,000 students currently enrolled.

"That's down 800 students from last year, and we expect to lose another 800 next year," said Ross. "In our district, our elementary schools are only filled to 56 percent of capacity. We have a system of neighborhood schools built to accommodate a larger population.

"That's the reality for us and how the numbers affect us. The (Finance Department) projections are not a trend that surprises me. It's a challenge for us."

Still, most of those concerned about the slowdown in population growth also expressed optimism that their communities were strong enough to endure it.

"I think it's a good thing," said Tom Cosgrove, who moved to Lincoln 27 years ago and was a City Council member for much of that time. "Growth at a steady, slow rate gives more predictability, and it gives the local government and community the chance to absorb that growth."

Others note that predicting the future of California has confounded the state's brightest minds for decades. Who can say that there won't be another housing boom in 15 years or that another flood of Bay Area transplants won't hit Sacramento in 10?

"People want a safe place to live and a good place to raise a family," said Cooper, arguing that Elk Grove will turn out fine. "I still see families looking to move to better neighborhoods."

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