SLO County’s population is dropping as more people flee the area, numbers show
California’s historically strong population growth has ground to a near halt, new data show, and San Luis Obispo County is no exception.
The trend is being fueled by two forces: Far more people moved to other states than moved here from elsewhere in the United States and the birth rate continues to drop while older baby boomers have died, some due to COVID-19.
Locally, San Luis Obispo County’s growth seems to be stagnating, with 2020 marking the second year in a row that the population declined.
According to data from the state Department of Finance demographics unit, it is only the fourth time since record-keeping began in the 1940s that San Luis Obispo County’s population has dropped — and three of those drops have occurred in the past decade.
The bigger picture, though, is that the Golden State, long seen as a beacon of opportunity, has become a more difficult and less attractive place in which to live, pay the rent, buy a house and do business.
The state growth rate in the year leading up to July 2020 was just 0.05%, the lowest number in modern recorded history, dating back to 1900. It was the third year in a row that the state recorded a record low population rate increase, according to the state Department of Finance demographics unit. The July 2019 rate was 0.23%.
The state’s new official population is 39.78 million, a mere 21,200 more residents than the previous year.
California’s new population is 451 fewer people than state officials estimated the population to be six months earlier, on Jan. 1, 2020. Both numbers are estimates. If that trend holds up, 2020 could turn out to be the first year the state actually lost population since 1900.
Nationally, population growth has been slow for years as well. But the new numbers serve as a warning to California policymakers.
“This data should focus public attention on problems with housing costs and the state’s business climate,” said Jeffrey Michael, head of the Center for Business and Policy Research at the University of the Pacific in Stockton.
“Policy-makers need to take greater account of this trend in financial and infrastructure planning.”
California lost a net 261,000 residents to other states in the time period, the most in nearly 25 years.
That migration pattern has been in place since the Great Recession more than a decade ago, but began accelerating dramatically last year.
State officials said the latest population numbers may have been affected by the early stages of the COVID-19 shutdown.
“While domestic out-migration continued along previous trends, domestic in-migration seemed to slow in 2019-20, especially from April to June when the stay-at-home order was in effect,” the state Department of Finance said in a statement.
California lost a net number of more residents to other states for several years in the mid-1990s, when federal base closures led to a retrenchment in the aerospace industry, notably in Southern California, state officials said.
State officials said California remains a desirable place to live.
“There is still strong demand to live in the state, as evidenced by the record high home prices reached this year, and hundreds of thousands of people – disproportionately ones with higher incomes – who are willing to continue to put down roots in the state,” the finance department said in its statement.
SLO County population continues to decrease
In the year leading up to July 2020, San Luis Obispo Count’s population decreased from 274,926 people to 273,884 people, a 0.38% drop.
This continued the downward trend from 2018 to 2019, when the population dropped by 0.33%.
Most of the recent decline was due to a larger number of people leaving San Luis Obispo County than coming in, possibly due to the area’s notoriously high cost of living.
According to the data, the number of births and deaths in San Luis Obispo County were virtually the same, with only 47 more people being born locally than dying in the county between 2019 and 2020.
A total of 1,315 people left San Luis Obispo County during that time, and only 226 moved into the county, leaving a net migration decrease of 1,089 people.
The past year ties with 2011 for the largest local population decline in recent history, and is one of only four times since 1947 that San Luis Obispo County’s population has dropped.
The largest local population drop occurred between 1953 and 1954, when the county’s population fell by about 6,500 people. This was likely due to the ending of the Korean War, and a decline in soldiers training and living full-time at Camp Roberts.
San Luis Obispo County had the 12th largest population loss in the state, ranking behind counties such as Los Angeles, Santa Cruz and Monterey.
Los Angeles County was the biggest population loser in California, dropping more than 40,000 residents.
As many areas of coastal California saw their populations shrink, Central Valley communities grew in general.
The COVID-19 pandemic may be a key player in the shift, as more coastal Californians move to the Central Valley for the same economic reasons that others are leaving the state.
Did housing costs, wildfires play roles in population drop?
Some of California’s problems are systemic.
Housing costs are among the highest in the country. Large wildfires have not only become the norm, but are also increasingly burning homes in residential areas.
In a clear sign of California’s struggle to manage basic affairs, utility officials intentionally now cut power to residents due to fears that electrical lines might spark fires in high winds. The state came close to cutting power this summer simply due to a lack of electricity.
“This does call into question how healthy the state is,” said Ryan Lundquist, a real estate data analyst who has been exploring why people leave the state. He says he is seeing more “California hate” online, with people declaring they are leaving because they are fed up with some element of the state.
But he and others say it appears some of the anti-California commentary is overwrought.
Adam Fowler, an economist in Los Angeles with Beacon Economics, is bullish on California, based on its intellectual firepower and its overall beauty. But he says the state does have work to do, especially on providing more housing and fairer taxing.
“California rocks,” Fowler said. “The weather is famously agreeable, the state’s residents are some of the smartest and most innovative in the world, and the economic opportunity is virtually unparalleled in the United States.”
That said, “robust population growth can paper over bad policymaking,” he said. “Much of California’s revenue policy, especially at the local level, is built around an assumption of growth.”
When growth stalls, governments need to adjust policy to balance budgets rather than increase taxes, he said. “Higher local taxes aren’t exactly an effective strategy in attracting new residents or retaining current ones. As higher taxes push out more residents (or potential residents), the cycle reinforces itself.”
“If the state legalized more multifamily housing and implemented a fairer property tax regime, we would unlock population and economic growth that is currently constrained.”
This story was originally published December 18, 2020 at 5:00 AM.
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