USA Economy: Demographic Profile

Immigration, immigrant, citizenship, naturalization
An elderly woman attends a rally for immigration reform REUTERS/Lucas Jackson

Strong population growth of around 0.8% per year over the next five years will be driven by a combination of natural increase and immigration.

Immigration accounted for much of the total growth in the population over the last five years, and The Economist Intelligence Unit expects the contribution from immigration to remain firm in the forecast period.

Immigration slowed slightly after the 2008-09 financial crisis because the deep recession diminished the attraction of the American labour market. As the economy recovers at a faster pace than that of comparable OECD countries, US employment opportunities are likely to look more attractive once again.

Natural population growth, at around 0.6% per year, is strong in comparison with most other developed economies, partly reflecting the presence of a large number of first-generation immigrants who tend to have a higher fertility rate than native residents.

Labour force participation has been on a downward trend for some years. We expect the ratio to recover only modestly as workers who were discouraged by the lack of opportunities in the labour market gradually return to the workforce. In the long term, once the recovery is complete, female labour force participation is unlikely to resume its earlier upward trend, given that it has already reached a very high level.

Male labour force participation was declining slightly before the crisis, but the lowering of household wealth as a consequence of the bursting of the housing bubble may reverse that pattern and slow the trend for male workers to retire early. The retirement of a large generation of “Baby Boomers” will also increase the retiree population at the expense of those of working age.

All the same, the US population is relatively young compared with other developed countries. The ageing of the population and the need for reform of Social Security (the federally funded pension plan) are causes for concern, but the number of people aged 65 and over is not set to rise particularly fast during the forecast period. The percentage of the population in this age bracket will climb to 15.7% in 2018, from 13.9% in 2013.

Immigration reform is one of the few major issues that has a chance of overcoming congressional deadlock, partly because it is in both parties’ electoral interests to attract the votes of the fast-growing immigrant population. The central elements of a widely discussed plan are the establishment of a path towards legalisation (and possibly citizenship) for an estimated 12m illegal immigrants, allied with stricter border enforcement mechanisms.

The latter are meant to prevent the inflow of new immigrants seeking similar legalisation, but may not be able to stem the flow. Measures to ease a shortage of highly qualified workers in some sectors are also likely to be part of the plan.

Yet, the push for legislation has lost momentum as House Republican leaders have decided to avoid an intra-party skirmish before the mid-term elections in November and delay these reforms to a less politically sensitive time.

Demographic profile
2008 2013 2018
Population (m)
Total 304.4 316.4 329.3
Male 149.7 155.7 162.3
Female 154.7 160.7 167.0
Age profile (% of total population)
0-14 15.6 15.2 15.0
15-64 62.7 61.3 59.4
65+ 12.6 13.9 15.7
Young-age dependency ratio 0.25 0.25 0.25
Old-age dependency ratio 0.20 0.23 0.26
Working-age population (m) 190.8 193.9 195.6
Urbanisation (% of total) 81.6 82.9 84.3
Labour force (m) 154.3 155.4 162.4
Period averages 09-13 14-18
Population growth (%) 0.8 0.8
Working-age population growth (%) 0.3 0.2
Labour force growth (%) 0.1 0.9
Crude birth rate (per 1,000) 13.8 13.2
Crude death rate (per 1,000) 8.2 8.3
Infant mortality rate (per 1,000 live births) 6.2 5.7
Life expectancy at birth (years)
Male 75.7 76.6
Female 80.7 81.4
Average 78.3 79.0

Sources: International Labour Organisation (ILO), labour force projections; Economist Intelligence Unit estimates and forecasts; national statistics.

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