Economists who study urban areas argue that cities lead to higher levels of productivity due to agglomeration economies. In other words, the higher the density of individuals, the higher the overall level of productivity within that area. To examine the potential for productivity growth in the Eighth District, we looked at population and population density growth trends between 2000 and 2011.
The District, whose population grew 6.5 percent since 2000 and 2.0 percent since 2007,1 experienced significant growth in its metro areas.2 To illustrate, Table 1 indicates that the population in the District's metro areas grew 9.9 percent since 2000 and 2.9 percent since 2007. During these time periods, three of the four major metro areas in the District grew at rates lower than the nation's. Specifically, the populations in Louisville, Memphis and St. Louis grew 11.0 percent, 9.7 percent and 4.3 percent, respectively, since 2000 and 3.6 percent, 2.5 percent and 1.3 percent since 2007.
Little Rock grew 15.9 percent since 2000 and 5.7 percent since 2007, rates higher than the District's and the nation's cities.
The District's largest levels of growth, however, came from some of the smaller metro areas. Of these areas, the fastest growers were Fayetteville-Springdale-Rogers, Ark.-Mo. (35.6 percent since 2000 and 8.5 percent since 2007); Bowling Green, Ky. (22.0 percent since 2000 and 6.9 percent since 2007); Columbia, Mo. (20.3 percent since 2000 and 6.1 percent since 2007); and Springfield, Mo. (19.0 percent since 2000 and 4.0 percent since 2007). Only one area—Pine Bluff, Ark.—showed a population decline (–7.7 percent since 2000 and –2.9 since 2007).
To examine the migration into the District's cities, we looked at city- and county-level data from the 2007-2011 American Community Survey. According to Table 1, the percent of District residents who had moved during the sample period was 16.2 percent, about 1 percentage point higher than the percentage of urban residents in the U.S. who had moved during that time. The District's metro areas with the highest levels of mobility from 2007 to 2011 were Columbia (27.2 percent), Bowling Green (22.6 percent) and Jonesboro, Ark. (22.3 percent).3 The cities with the lowest levels were Owensboro, Ky. (13.4 percent), St. Louis, Mo.-Ill. (13.7 percent) and Louisville, Ky.-Ind. (14.0 percent).
Of those moving within metro areas in the District or into those metro areas from outside, only 27.6 percent were new residents to the area, compared with 42.8 percent of migrants who were new residents to their respective cities throughout all U.S. urban areas. In fact, only two of the District's metro areas—Elizabethtown, Ky., and Jefferson City, Mo.—had higher percentages of new residents than the average among all U.S. cities.
The low rate of new residents as a percentage of total movers in the District implies that there are high levels of intracity migration. This trend could indicate that the cities within the District were growing spatially. Table 2 examines the level of suburban sprawl: individuals moving from central cities and inner suburbs to outlying suburbs.
Among the new residents in the District's metro areas from 2007 to 2011, 15.9 percent moved directly to outlying counties compared with 7.9 percent of new residents in U.S. cities. Across metro areas, there is a high level of variation in the percentage of new residents moving directly to outlying areas. For example, only 3.5 percent of new residents in Columbia and Elizabethtown moved directly to the outlying counties compared with 53.9 percent of new residents in Jefferson City, Mo.
From 2007 through 2011, the District also had fewer individuals moving from the central city to the outlying areas (48.6 percent) relative to the average of all U.S. cities (50.7 percent). The movement to outlying areas also had a high degree of variation. For example, 23.2 percent of St. Louis movers left the principal city for residence in outlying counties, while 77.1 percent of residents in Columbia left the principal city for outlying counties.
Changes in population density allow us to examine whether fewer city residents are moving out into the suburbs. Within the District, the population density in cities overall, central areas and outlying areas has grown at rates slower than in the rest of the country. For example, central city population density and outlying area population density have increased 3.2 percent and 2.4 percent, respectively, since 2007. These figures show that the density of residents in central areas has actually increased more during the past five years than the density of residents in outlying areas. In fact, suburban population density has actually decreased in five of 18 cities in the District: Cape Girardeau-Jackson, Mo.-Ill.; Evansville, Ind.-Ky.; Jonesboro; Owensboro; and Pine Bluff. Only one central area—Pine Bluff—had a decrease in central area population density over this period.
Glaeser, Edward L.; and Gottleib, Joshua D. "The Wealth of Cities: Agglomeration Economies and Spatial Equilibrium in the United States," Journal of Economic Literature, December 2009, Vol. 47, No. 4, pp. 983-1,028.
Pakko, Michael R.; and Wall, Howard J. "District Overview: Population, Sprawl and Immigration Trends in Eighth District Metro Areas Vary Widely." Federal Reserve Bank of St. Louis' The Regional Economist, Vol. 15, No. 3, July 2007, pp. 16-17.
Keep up with what’s new and noteworthy at the St. Louis Fed. Sign up now to have this free monthly e-newsletter emailed to you.
Fed in Print: An index of the economic research conducted by the Fed.