Thursday, December 19, 2013

Americans Are Staying Put

By: Paityn Nelson
Why do we move? Jobs are eliminated, and new ones appear. We can’t afford a new mortgage; people won’t show an interest in the house for sale. There are many reasons why Americans today stay put, and most of them have to do with the tough economy. It is said that “According to Census Bureau data from 2013, about 4.8 million Americans moved across state lines in the previous year. That is down from 5.7 million in 2006 and 7.5 million in 1999.” This slow down represents a shift in the economy and labor market. This has affected people in every age group, industry, and income level.  The poor and middle class are not the only who are having a hard time during this economy trying to sell or buy a new house.
When we look back in history it is actually quite impressive how brave people were back then. Imagine how much worse off the country might be if the 49ers had decided against making the trek to California or the sharecroppers chose to stay in the South. But even these people who were once so brave are now more likely to stay in the same home they have been in since they moved here. For this we can blame rising cost of living in the most desirable and fastest-growing areas of the country. Jed Kolko, chief economist at Trulia, the real-estate website, recently indexed the “100 largest metro areas by their affordability, finding, not surprisingly, San Francisco and New York were at the bottom of the list and hollowed-out cities like Gary and Dayton were at the top”. Since the cost of living in the small towns is less expensive than living in the big city some people may choose to go there, but most will continue to put up with what they have to stay somewhere they prefer to live.

See picture below for the top states for domestic migration.

This is not only a short-term supply and demand issue or a side effect of the growing economy however. Kaplan and Schulohofer-Wohl won applause by many economics for developing a theory to explain why people have not decided to pick up and move. They say “earnings have become more similar across the country, meaning there is less incentive to move from one place to another in search of a raise”. Despite all of the actions that economists have taken they are still quote “a little unsettled”.  Finally Kolko says “if your job prospects don’t depend on having to move someplace else, the decline in mobility might be a good thing”.
There are many different views on how much people are moving, planning to buy, or wanting to sell but no matter how you look at it there is obvious question on how this will play out on the economy.

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20 comments:

  1. With the economic crash, the real estate sector crashed as well. Lots of people lost value on their houses and land property. I remember hearing radio ads about bank foreclosures on houses. The large amount of people moving to North Dakota is most likely to the recent discovery of oil in that area. The market is starting to regain its footing though.

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  2. While the economy crashes real estate is going down with it. It's crazy to think that in 1999 7.5 million people moved to across state lines and now the we're just below 5 million. That shows how bad the economy has gotten in the past 14 years. North Dakotas economy wasn't much a decade ago, but with the oil discovery it seems like everyone wants to live there.

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  3. This is a really interesting topic and I wouldn't have thought of writing about it, so good job on that. It really surprised me that the most migrated to state was North Dakota, but it also makes sense that our mobility rate has gone down. This relates directly to the economic crash that we've had. I agree with you that the decline in mobility might actually be a good thing because then there isn't a bunch of loans going out to everyone.

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  4. The idea behind lower moving rates speaks to a much larger-scale problem. This is that, as economic conditions worsen, people are less willing to spend money, and this reduction in money turnover means that people are unable to make as much. It is a self-worsening cycle.

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  5. I agree with Josh. People are loosing value on their homes and property and this entitles them to stay put. The fact that it is still difficult to sell a house in this economy forces the people to not move as much. Since the economy is recovering and like the report had stated, wages are becoming more level with everyone across the nation. When you take into consideration that more people are seeing equal wages and the economy is slowly rising, people tend not to move as much. Looking at those levels of affordability in those famous cities like New York and San Francisco, it's not surprise that North Dakota is the top city people move to. Great topic and great post.

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  6. It is very interesting to see such a drastic decline in mobility in our country as a whole. You bring up great points about our countries past and success as a consequence of movement, however a question to consider is how necessary is mobility in society today? As a collective society, America has settled the entire country and thrived in all areas. On a large scale "pioneers" are a thing of the past and innovation takes place not within new discovered lands but within settled establishments. On a smaller scale I think we should view the decline as a positive. A main cause for people to move is the loss of a job. If this is happening less that would consequently prove that our work to decrease unemployment has been successful. Less mobility may be a result of a stable job economy in which people are about to find consistent work without moving. However, I do agree that it will be interesting to watch what effect this has on the future economy as a whole.

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  7. You bring up some reasonable explanations for the lack of moving. I actually didn't know there was a decline in the amount of people who have been moving each year. I believe the reason may because that the decline in the economy may cause for there to be jobs nowhere. So these people decide to stay in a comfortable place, maybe move in with a relative instead of searching for a job in a new, unpredictable place with no guarantees.

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  8. It seems surprising that people are not moving as much anymore because of the downfall of the economy. But if you think about it, it makes sense that people aren't moving because if you lose your job you don't have the money to up and move to find a new job and even if you are offered a new job somewhere in a different state you might not be willing to take that job because people don't think it will be easy for the other person in their family to get a new job as well making it not worth it

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  9. I am not surprised that people aren't moving as frequently as they used to. The shut down and current economic problems are the obvious reason for why people aren't picking up and moving. I know many families generally will not move if they do not have to. The only reason why people are moving is because they are looking for work. It's really difficult to move into a state where you're offered a job that you probably do not want to do. The impact on moving companies must be really awful considering no one is hardly moving.

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  10. With the recent government shutdown and the ever failing economy it is a repercussion that people are not moving. People are losing their homes and jobs to the economy but they do not have enough money to move somewhere else and start over because that will just put them deeper in debt. Moving companies are most likely taking a huge downfall to because of the decline in moving and are suffering the economic dis-benefits from it.

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  11. It really is sad to believe that our economy is so bad that it is rare to move from one home to another. However for those that are more fortunate, owning and buying a home can be a very good things. And if you're well off enough then you may also be able to establish a good line of credit from owning a home and making all payments.

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  12. Since the market for houses is currently doing poor, many people are very hesitant to move, thus making it even worse for people who are buying houses. Most people move due to their job and not very many people move nowadays based on location, but rather where their job is taking them. This is an interesting topic that will apply to us once we graduate college.

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  13. It's odd to think that in the past, moving seemed to be the best bet for someone looking for a fresh start. If life got tough where you lived, just pack up and find someplace better. Times aren't so simple anymore. Moving now is a big deal for any family or even for an individual. Jobs cannot just be found anywhere anymore, so with no money a person will have a very hard time to support themselves. In addition, with no one moving if someone does want to move the selection of houses on the market has also dramatically dropped, thus making the move harder yet. All in all, our country went from a once mobile country to staying put.

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  14. With the housing market doing terribly, people are extremely hesitant to move to a new city. Prices for homes have skyrocketed, and that only leads to people wanting to move even less. With times as difficult as they are, people already don't have very much money, and they especially don't have the money to purchase a new home. The housing market is starting to recover, but it is still no where near where it had been 10 years ago.

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  15. In the past, people would move with the idea of starting fresh in another place, now people aren't as careless as they were since now they have to think everything out-- taking in consideration of the prices of the houses in the area in which they want to move, the job possibles and what is available there, etc, thus making the moving process a lot more hectic than how it was in the past

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  16. Thinking about times now, you don't really hear of people moving as often as we did when we were little. Houses are starting to cost more and even the price of a mover and trucks, etc. is getting expensive. The only time you really hear about moving now is when someone is switching jobs. The title of your post really tied together everything, we really are staying put.

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  17. Taking how poorly the American economy is doing right now; it is expected to see the plummeting rate of mobility. Especially now a day, people try to stay put within their homes and jobs mainly because of keeping seniority and/or keeping their jobs because they are unable to find other jobs with better benefits. Although moving can provide the sense of a fresh start, but maybe staying put in one are can provide a sense of stability in the hectic economy.

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  18. With America having a poor economy right now it isn't surprising to see that most people aren't moving as much as they used to. Right now if someone has a job they aren't going to risk losing it and not finding another by moving. Prices for homes and land have rose extremely high with this loss of mobility as well, shying people away from the idea of moving.

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  19. I really enjoyed your topic you chose and how you contributed a chart about where Americans are living throughout the country. It is interesting to see where the Americans are choosing to live and why they haven’t moved around. I liked that you said, “Jobs are eliminated, and new ones appear. We can’t afford a new mortgage; people won’t show an interest in the house for sale. There are many reasons why Americans today stay put, and most of them have to do with the tough economy.” I liked how you said this because it reassured me about why Americans are staying put where they are and what exactly is going on within the economy. Great Job!

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  20. Honestly, it is not a big surprise that the mobility rate has gone down so much. With the economy being so tight for most, buying even a small house or condo can be difficult. Also, with less and less jobs being available, there cannot be a stable income for those who wish to move to another state. If people cannot find work, they cannot receive money, if they cannot receive money, they are stuck where they are. It is as simple as that.

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