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CHAPTER 5 Effects of Demographic Change on Selected Economic Factors Impacting the Private and Public Sectors of Texas The characteristics of populations impact the private sector. The number and characteristics of populations affect the income and other economic resources of populations. Populations with larger proportions of adults in their most productive middle ages generally have greater economic resources for investment and higher levels of expenditures than those populations concentrated in youth, young adult, or elderly age groups. Similarly, levels of population growth are key components in the growth in overall markets, and the age, sex, and race/ethnicity characteristics of populations determine key market segments for different types of goods and services. The interrelationships are myriad and no single chapter can do justice to all of the interactive effects between demographic and economic factors. In this chapter we provide a selective view of some of the effects of projected patterns of change in Texas population and households on factors impacting the economic characteristics of populations and the demands of population and household change on key socioeconomic parameters. We examine the effects of change in the extent of population growth and the population’s age, sex, race/ethnicity, and household composition characteristics on income and poverty, on state tax revenues and expenditures, and on consumer expenditures in different sectors and product areas of the economy. We also examine the effects on household assets and net worth, on the number and rate of growth in owner and renter housing units, on the median value of owned housing units, and on the median rents for rented units. Although the analysis is quite extensive, it provides only a sampling 68 Chapter 5 of the important effects of demographic change on economic change in the public and private sectors. ECONOMIC CHANGE IN THE PRIVATE AND PUBLIC SECTORS FROM 2000 TO 2010 The data in Table 5.1 show that, despite extensive growth in Texas and its generally acknowledged lower rates of unemployment and reduced recessionary related changes compared to those that occurred in other parts of the nation, Texas maintained lower average incomes than the nation during the period from 1999 to 2010. Median income in the state increased (in constant dollars) relative to the nation from 89.9 percent in 1989 to 95.1 percent in 1999. By 2010 it had increased an additional 2.0 percent, with median household income levels increasing to 97.1 percent of the national median income level. Texas poverty rates remained higher than those for the nation. Poverty rates for persons in Texas were 117.0 percent of those in the nation in 2010, a decline from 124.2 percent in 1999 and 138.2 percent in 1989. Despite closure over time, in 2010, the percentage of persons in Texas in poverty was 17.9 percent, compared to 15.3 percent for the nation as a whole. Table 5.2 shows additional income and poverty data for Texas by race/ ethnicity of householder. The data in Table 5.2 show increases in income and also in overall poverty levels for all persons in all racial/ethnic groups over the period from 1999 to 2010. Whether examined in terms of median household, median family, or per capita income, incomes increased by between 24 and 37 percent from 1999 to 2010 for all racial/ethnic groups. Although the differences due to the recent recession are not totally encompassed in these data, it is evident that incomes increased in Texas from 1999 to 2010, and there were increases for all racial/ethnic groups. The data in Table 5.2 also show clear income and poverty differences by race/ethnicity. Median household incomes for nonHispanic Black and Hispanic populations were 60 to 65 percent of the levels of nonHispanic Whites. Incomes for nonHispanic Asian and Others were approximately 95 to 98 percent of those for nonHispanic Whites in 1999, and similar differences persisted in 2010. In 1999 whereas nonHispanic White households had a median household income of $47,162, nonHispanic Black households had a median income of $29,321, Hispanic households a median income of $29,873, and nonHispanic Asian and Other households had a median income of $44,717. In 2010 these values were $61,049, $36,466, $37,019, and $60,110, respectively. Due to differentials in family and household size (with larger household sizes being evident for some minority populations), differences in per capita incomes were larger (see Table 5.2). Per capita income in 1999 for the [3...

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