One casualty of the recession: U.S. mobility

Daniel Arevalo would love to sell his home in southern California, so he could move closer to his three young children. They live 45 minutes to the north, with his ex-wife.

But Arevalo can’t sell his house. The real estate market in Menifee, about 65 miles north of San Diego, is in the tank. Home values “are dropping like a rock,” said Arevalo. And even if he could sell the home that he bought five years ago for about $250,000, Arevalo doubts he would get the $175,000 needed to pay off his mortgage.

“I’m stuck,” he said.

It’s a scenario that’s playing out across the United States — people who’d like to move, but can’t. And it’s a sea change for this country.

Americans typically have been willing to pack their bags and move. But the weak economy and a limp housing market have meant that many more people in this ordinarily footloose nation are staying put, unable to sell their homes, find a job, or just too uncertain about what the future may hold.

It’s a situation that could pose added problems for the already wobbly U.S. economy, according to experts. And it’s a trend that reverses a decades-old pattern.

“This is very unusual and historic,” said William Frey, a demographer at the Brookings Institution in Washington.

Frey noted the overall rate of migration in the United States has plummeted to its lowest level since soon after the end of World War II, when the government first began to keep records on U.S. mobility. “It’s almost half of what it was during the heyday of migration.”

That period occurred in the 1950s and 1960s, when roughly 20 percent of the nation’s population picked up and moved each year. By contrast, the percentage of people changing residences fell to 11.9 percent in 2008 from 13.2 percent in 2007, according to the U.S. Census Bureau.

Experts said the drop in migration in recent years, before the current recession, reflects various factors. More people began owning their homes during those years, instead of renting. And homeowners tend to move around less. Also, young adults and early retirees tend to migrate more. However, baby boomers have yet to begin retiring in large numbers and the median age of the population is now pushing 40. So there have been fewer young adults and early retirees pulling up stakes and moving, versus past years.

The absolute number of people moving also has tumbled to historic lows, despite a rise in the nation’s population. The number of people who changed homes fell to 35.2 million from March 2007 to March 2008, down from 38.7 million the prior year. The 2008 total was the lowest since 1962, when the nation had 120 million fewer people.

Experts said this historic slowdown in migration can hurt the economy because job seekers have less ability or willingness to move to a spot or region where jobs may be more plentiful.

“Migration is one of the ways in which the market system works,“ said Richard Cebula, professor of economics at Armstrong Atlantic State University in Savannah, Ga.

“The labor markets are sluggish. They’re not adjusting efficiently,” he added, noting the situation “exacerbates a recession.”

It's even playing into the growth of cities, with many of the nation's largest metropolitan areas  growing at a faster pace than the rest of the U.S., according to recent census data.

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