In this piece, we will take a look at the fastest declining large city in the US. If you’re interested in knowing which other large cities in the US are witnessing a population decline (and whether big hitters like New York City also made the cut), you can check out 15 Fastest Declining Large Cities in the US.
Population growth or size is an essential component of economic development. A robust and vibrant population allows countries to allocate more labor to industrial and other economic activities. If the prevailing conditions, such as law and order and political stability, allow, then the large population can be quite productive and propel a country towards growth.
As an illustration, let’s take a look at some of the biggest economies in the world. According to Insider Monkey’s research, the five largest economies in the world as of 2023 end in respective order are the United States, China, Germany, Japan, and India. Three of these, namely the US, China, and India are also among the list of the five most populous countries in the world. The American, Chinese, and Indian economies were worth $26.9 trillion, $17.7 trillion, and $3.73 trillion, respectively in 2023 while their populations were 339 million, 1.42 billion, and 1.43 billion in the same order.
This makes it clear that a large population is quite important when it comes to economic growth. This also means that a slowdown in population growth starts to worry economists and analysts as well. For instance, the Conference Board, which is a New York City based think tank known for its insights into America’s economy, worried in December last year that a slowdown in population growth could also affect the GDP.
This rate, according to the think tank’s analysts, could end up affecting average US real GDP growth. This stood at 2.2% between 2011 and 2019 and could slow down to 1.7% over the next decade. Some factors that will affect America’s population and economy in the future include a dropping fertility rate (the average number of children born per woman) and a drop in the rate of working age to retirement age population. The latter is particularly worrisome as it increases the tax burden on younger generations to fund those who are now retired.
Another advanced nation, and one which is also among the top five largest economies in the world, that is facing its fair share of worries about a potential population decline is Japan. Japan had the shortest post second world war ‘baby boom’ and ranks high when it comes to life expectancy. The country’s population has dropped consecutively on an annual basis for more than a decade, and estimates from the International Monetary Fund (IMF) show that Japan might be suffering from the problem of a heavier burden on younger workers due to a declining population. According to data, Japan’s labor force fell from 70% of the population in the early 1990s to 59% as of 2020. What this means is that a higher number of Japanese have now moved into retirement, and the younger ones have to pay more taxes since the labor force participation rate has dropped. For more details on this topic, you can take a look at 50 Most Densely Populated Countries in the World.
Switching back to America, a large area means that the US isn’t densely populated by any means. Data from the Census Bureau shows that 2023 marked the first post pandemic period of normalization. The pandemic reshaped global population trends, as a large number of deaths meant that populations declined instead of growing. Brookings’ data shows that during 2020 – 2021 and 2021 – 2022, urban core areas in America experienced -0.92% and -0.28% in population growth. In other words, their population declined due to a higher number of deaths and growing migration due to remote work trends.
Now, the Census Bureau believes that America’s population growth rate grew to 0.5% last year over 2022 and 2021’s rates of 0.4% and 0.2%. America added more than 1.6 million people in 2023, and driving this population growth were the Southern states. Out of the 1.6 million gain, 1.4 million came from the South, and apart from births, migration also played an important role in the growth with more than seven hundred thousand people migrating to the South last year.
Now, the Census Bureau believes that America’s population growth rate grew to 0.5% last year over 2022 and 2021’s rates of 0.4% and 0.2%. America added more than 1.6 million people in 2023, and driving this population growth were the Southern states. Out of the 1.6 million gain, 1.4 million came from the South, and apart from births, migration also played an important role in the growth with more than seven hundred thousand people migrating to the South last year.
However, just as it has disrupted other industries, technology is also opening more avenues for population growth. Firms that provide fertility enhancement products and expand their use are INVO Bioscience, Inc. (NASDAQ:INVO) and Progyny, Inc. (NASDAQ:PGNY). Among these, INVO works on the product side of the industry, while Progyny works on the demand side by expanding access to these products.
Seems like even though US population is struggling to impress the growth advocates, fertility stocks have been doing well. Starting from INVO, the firm’s first quarter of 2024 earnings saw it report a whopping 353% annual revenue growth. During the quarter, INVO’s revenue sat at $1.5 million, which was in a different league compared to its Q1 figures of $348,025. Progyny has also been doing well on the financial front lately. It has beaten analyst adjusted EPS estimates in all four of its latest quarters, and the average of eight analyst share price ratings is Strong Buy to boot. The average share price target is $37.63. However, its shares dropped by 15% after the first quarter earnings as revenue of $258 million fell short of analyst estimates of $289 million. The stock also fell by 17% in February after first quarter revenue guidance missed analyst estimates.
While we acknowledge the potential of fertility companies, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
Zooming into population decline, the Northeast region of America maintained its trend. According to the data, the region’s population declined by 43,330 last year. While this is concerning, a silver lining is that the 2023 decline was slower than previous years’ trends. The Northeast’s population dropped by 187,054 in 2021 and accelerated to 216,576 in the following year. State wise, the states where population dropped last year are “California (-75,423), Hawaii (-4,261), Illinois (-32,826), Louisiana (-14,274), New York (-101,984), Oregon (-6,021), Pennsylvania (-10,408), and West Virginia (-3,964),” according to Bureau. Cumulatively these states lost 249,161 people in 2023, which is considerably lower than the 509,789 reading of 2022.
If you were wondering which of these states led the pack in population decline, Insider Monkey looked at these statistics as part of our coverage of the 15 Fastest Declining States in the US. The top five worst offenders in this list were Hawaii, West Virginia, Louisiana, Illinois, and New York which saw populations drop by 0.5%, 0.6%, 0.8%, 0.8%, and 0.9%, respectively.
After reading these statistics about US population growth and decline rates, if you were wondering which city is currently experiencing the fastest population decline in America, you’re in luck as we’ve compiled data for the fastest declining large city in the US.
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Our Methodology
To make our list of the fastest declining large cities in the US, we used the Census Bureau’s data of resident population for 1,909 cities with more than 20,000 people as of July 1, 2023. This list was first narrowed down to the 50 largest US cities by population. Then, these fifty cities were ranked based on the percentage of population change between 2022 and 2023. Out of these, the top 15 cities with the fastest population decline rates were chosen.
By the way, Insider Monkey is an investing website that tracks the movements of corporate insiders and hedge funds. The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
Philadelphia City, Pennsylvania
Population Change Percentage: 1.04%
According to the above methodology, Philadelphia, Pennsylvania is the fastest declining large city in the US. Philadelphia suffered from the pandemic just like every other American city. It managed to reverse the pandemic’s effects on the job market by the third quarter of 2022.
The fastest declining large city in the US, Philadelphia is also the sixth largest city in the US in terms of population as of 2023, Philadelphia’s population sat at 1.5 million in 2023. Between 2020 and 2023, the population has dropped by 3.13%.
Philadelphia is one of the most historic cities in the US as well, due to its close ties with the American Revolution. It has also played a key role in the industrial era due to a vibrant steel industry which earned it the nickname of Steel City. These days, Philadelphia is still reeling from its lost industry, with estimates from Wharton showing that the city’s population has dropped by more than 600,000 since 1950.
As for the future, The Chamber of Commerce for Greater Philadelphia is quite optimistic. Its annual State of the Economy report was published in December 2023. This report saw 27.6% of businesses surveyed say that they expect Philadelphia’s economy to grow in 2024 over 2023. Additionally, this report also provides key details for Philadelphia’s job market. It shows that two of the biggest problems that businesses in Philadelphia struggled with were labor availability and high interest rates. These blend in with the broader narrative about the American economy as well, as a tight labor market has pushed wages higher and made the Fed raise interest rates to cull the resulting inflation.
If you want to find out about which large US city follows Philadelphia, you should check out 15 Fastest Declining Large Cities in the US.
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Disclosure: None. This article is originally published at Insider Monkey.