Demographics Play a Major Role in the Current Economic Recovery

Introduction

Demographics are a key factor in shaping US economic life. The growth and structure of the population determine the demand for private consumption and the key commodities and services within a given environment. Demographics also determine prospects for major public expenditures, especially health care and education.

Changing demographics affect the labour market in two ways:

in the occupations required and employment opportunities available to workers; and

by altering the composition, such as age and ethnic distribution, of the labour force.

The Baby Boomer generation is the largest and their needs have created a very large market for goods and services. However, as Foot's articles went on to explain, one group that has been overlooked will offer unprecedented opportunities for companies that can offer particular goods and services to the group over the next 30 years.

This group is called the Blessed Ones. They are a valuable niche market because they have money to spend.

Discussion

The U.S. is a land of diverse geography, culture, climate and economic activity. As a nation founded and settled by immigrants, the country has always had a dynamic population. Never has this been more true than today. Indeed, the U.S. population in the early years of the 21st century is undergoing profound change with increased immigration, a huge age group entering retirement age, another generation in their prime home-buying years, large regional migrations and more. All of these factors will have a huge impact on home purchasing and selling habits and home buyers' design preferences with major implications for residential developers.

A massive home sell-off by retiring baby boomers could spur a significant contraction in the home building industry.

The existing supply of large-lot homes, mostly located in the suburbs, may already be sufficient to meet needs through 2025 in many parts of the nation.

Recent immigrants will be a significant force in the home buying market.

Single women will be increasingly active in the home buying market.

Though those over age 65 buy fewer homes than younger people, the enormous size of the baby boom generation means that senior citizens will be a major home buying group and could very well be a prime market for new construction.

The U.S. population can be divided into many groups; for the purpose of analyzing the future home buying market, however, we'll pay attention to these key groups:

Baby Boomers

Generations X and Y

Women

Latinos

Asians

Baby Boomers

The baby boom generation is typically defined as those born between 1946 and 1964. Following the Great Depression and the sacrifices of World War II, enormous pent up demand for young adults to start families was unleashed. By the end of the 1940s, about 32 million babies had been born in the decade, compared with 24 Million in the 1930s. In 1954, annual births first topped four million and did not drop below that figure until 1965, when four out of 10 Americans were under the age of 20. This post-World War II generation, some 80 million strong, comprises nearly 28 percent of the U.S. adult ...