NEWS

Why Florida is more loved than New York

Wayne T. Price
Gannett News Service

Florida is growing again with nearly 300,000 new residents making the Sunshine State their home last year. That makes it the third most populous state behind California and Texas.

For Florida, which surpassed New York in population, that means more people buying homes, paying taxes and demanding additional goods and services. And that leads to more jobs.

Central Florida Hank Fishkind addressed issues associated with this migration on his weekly radio show last week.

QUESTION: What's the direct economic impact of more people moving to Florida?

Fishkind: It affects it directly because it creates demands for all the goods and services in the local economy. It affects it directly because of the demand for construction to house people and the stores that they will shop in. So it has a very large effect.

And then because we get a significant portion of retirees, retirees bring their income with them. So even though they don't work in the local economy, they create a lot of cash flow and a lot of spending. And so for all those reasons Florida's economy is very dependent upon population growth and the economy of Central Florida is very dependent upon on it.

We have large retirement communities, some of the largest in the whole world — The Villages for example. So population growth is critically important to the Florida economy and that's why we track it so carefully over the course of the business cycle.

Q: So why is the population growing here?

Fishkind: The population is growing because people love Florida. We continuously attract significant amounts of retirees and significant amounts of people in the labor force. But that flow is very sensitive to the business cycle. So at the peak of the business cycle we were attracting almost 500,000 people a year to Florida. Then we got to the trough of the cycle in 2009 and only a 126,000 came.

Then as we began to have a recovery, our population growth moved up. But it was very unusual. It sort of plateaued out at about 200,000 per year in 2011, 2012 and 2013. I had thought that perhaps that was the top of the cycle. And then we got this report that said 'No, in 2014 Florida's population growth spurted up to 293,000 — a gain of over 50,000.' That was a big deal.

Q: Where is the growth coming from? More births? More people moving here?

Fishkind: There are births over deaths of course. That's called natural increase. That's about 40,000 per year on average. Then we have about 100,000 international migrants — legal migrants — mostly from Latin America and mostly in South Florida. And then this big fluctuation occurs because of domestic migration. so in 2014 our domestic migration shot up to almost 140,000 — up 50 percent compared with 2011, 2012 and 2013.

Most of those migrants come from east of the Mississippi River. And they come for two reasons, either to retire or to work in Florida.

Q: We're still not growing like we were a decade ago. Does that change any of your growth predictions?

Fishkind: No, actually it kind of helps the prediction because we're underperforming relative to trend. We can rise the trend, historically speaking. But more importantly, the fundamentals are there to support stronger population growth. We have tremendous job growth in Florida so we are attracting labor-force-age people. During the Great Recession we lost labor-force-age people because we lost so many jobs. Now we're one of the fastest-growing job states so we're attracting labor-force-age people. And, because housing markets are strong, and have been strong for some time, people can sell their homes and be able to afford to move to Florida again. So we're seeing a very significant upswing in retiree migration.

Those things will continue in 2015 because we have low rates of interest, low inflation, and strong job markets — all of the fundamentals that would support strong population growth in Florida

Q: Any downsides to a growing population in Florida? Is there a concern about concerning finite resources?

Fishkind: Always. That's always been part of the Florida story. We have a lot of growth. We have a big state but it does consume a lot of resources. We need to be very cognizant of our water resources and our land resources and how we're going to deal with traffic and education and the demands for health care — all of the things that people bring.

But, it's always easier to manage growth than it is to manage decline. Look at Detroit. As many problems as growth causes, a lack of growth causes a lot more problems."

Hank Fishkind is a principal at Fishkind & Associates, in Orlando, Naples and Port St. Lucie