The 2010 census is being released in a very different world than its predecessors. The amount of real-time data on populations and demographics is exploding. And it now receives competition for the spotlight from its younger sibling, the annual American Community Survey, which makes up with timeliness what it loses in margin of error.
That said, having access to the final, hard numbers gives researchers and planners the ability to quantify exactly how much these trends are taking hold and what areas are seeing the most impact. Some patterns have crept up on us, and some have turned out to be even bigger than suspected. Here are five findings everyone in the business should be aware of.
1. There are 1.2 million fewer children in the Northeast and Midwest than there were in 2000. That meant a 3.1% decline for the Midwest and a 5.5% drop for the Northeast. By contrast, the South gained about 2.2 million children and the West picked up about 900,000. Nearly all of that growth was driven by minority populations -- 1.6 million newborns were either Hispanic, Asian or multiracial. Between 2000 and 2010 those two regions dropped 2.6 million white, non-Hispanic children and about 225,000 African-American children. This alters a trend seen in previous Census data. In the 1980s and 1990s the growth in the Hispanic population came primarily from immigration. Now it is from native births, said Mark Lopez, the associate director of the Pew Hispanic Center.
This trend is compounded by the aging of the majority, non-Hispanic white population (and African-Americans as well) out of the child-bearing age range. Another factor was the high out-migration of young adults and their children from the Northeast and Midwest to the South and West regions. Moving to warmer climates isn't just for retiring boomers anymore.
This is likely to have negative consequences for consumer spending in states with so many fewer children. Married couples with children have the highest income of any household type, and on average, the income of a family with children is at least $10,000 higher than that for all households. They also tend to outspend other household types, according to the Bureau of Labor Statistics.
The changing picture of the child population also starts to give marketers a preview of Census 2020 and 2030, which will continue the trends of increasing diversity, perhaps even faster than current estimates. Elizabeth Ellers, exec VP-corporate research at Univision Communications, likened this to the Baby Boom, which was a "trend that started in 1945 but still playing out." It will affect every product category at some point in the coming generations.
2. Minority populations grew eight times faster than the majority white, non-Hispanic population. White, non-Hispanic adults edged up 4.4% nationwide from 2000 to 2010. By contrast, all other adults including Hispanics, Asians, African-Americans and other races increased 32.2% and accounted for nearly three-quarters (74%) of all U.S. growth among the population ages 18 or older.
White, non-Hispanic children under age 18 declined 9.8% between 2000 and 2010, while Hispanic children or children of other races increased 36.5%. One key exception was African-American children, who also declined, but at a slower (2.3%) rate. White, non-Hispanic children declined in every state except four: Idaho, North Carolina, South Carolina and Utah, and, oddly, the District of Columbia. It's strange that non-minorities would be increasing in D.C., a city that's 50% African-American.
An aging and slow-growing white, non-Hispanic population with fewer children is important because it happens to be the consumer segment with the most money and the highest level of spending on goods and services. They may be 67% of U.S. adults, but they are a full 80% of the households with an annual income of $100,000 or more. And white, non-Hispanics who are married with kids are the highest earners and spenders of all.
This might be especially troubling for the "short term" of the next decade or so. By definition, half of all households made less than the median, but that number was 60% for Hispanic households, compared to just 46% for households headed by non-Hispanic whites. In the long run, immigrant populations tend to catch up economically.
"I see nothing in the data to suggest that any of these groups will become a permanent underclass," said Barry Chiswick, chairman of the economics department at George Washington University and author of "The Economics of Immigration."
"If you called me in 1890, you'd be saying, 'There are large increases of Jews, Italians and Greeks. They don't know much English, they don't have many skills. They have little chance of doing well,'" he said.
3. Hispanics are more highly concentrated than the headline about their rapid nationwide growth would suggest. According to the 2010 Census results, nearly half of all U.S. Hispanics live in just two states: California, where 28% live, and Texas, where 19% live. Three-quarters live in just eight states, each with more than 1 million Hispanic residents. Those are California, Texas, Florida, New York, Illinois, Arizona, New Jersey and Colorado.
The ninth-largest Hispanic population state (New Mexico) is remarkable because it has the highest density of U.S. Hispanics. Almost half (46%) of that state's population is Hispanic, while just 41% is white, non-Hispanic. Nevada has only about 716,000 Hispanics but they represent 26.5% of the total population.
When marketing to any market segment, large numbers are important but so is density. The Hispanic population isn't at a critical mass yet in most places, but that's starting to change. The majority of states now have at least a 5% Hispanic population and 17 states have more than 10% -- up seven states from 2000. "Nearly every county in the U.S. had Hispanic population growth," said Mr. Lopez. Univision's Ms. Ellers said that many marketers seem to be paying more attention now that the Hispanic population has hit the magic number of 50 million. Planners are looking at how to reach this target in areas not traditionally thought of as Hispanic. "It's not just the five top markets and you don't have to worry about anything else," she said.
Only one of the 100 largest cities in the U.S (Arlington, Va.) had its Hispanic population decline in the past decade. Most saw double- or triple-digit increases. But in all but Spokane, Wash., the white population makes more than the Hispanic population.
4. The Asian population is the fastest-growing racial or ethnic group in the U.S., but it is even more highly concentrated than the Hispanic population. There are now 14.5 million Asians living in the U.S., up 43% since 2000. One-third of all U.S. Asians live in California and another 10% live in New York state. The Asian-adult population rose 47%, but Asian children also increased rapidly and are up 31% since 2000. Texas, New Jersey, Illinois and Hawaii each have more than half a million Asian residents.
This population is important because Asian median household income is the highest of any racial category and is 1.4 times the median for all households. It is also 26% above the median income of white, non-Hispanic households. But equally important is that 35% of Asian households are married with children, compared to just 21% of white, non-Hispanic households. Asians are the only race or ethnic market segment that is both rapidly growing and affluent. Asian immigrants typically are highly skilled and educated, compared to other immigrant groups, said Mr. Chiswick.
Reaching this demographic has been challenging because there wasn't a good national way to do this. Enter Mnet, formerly ImaginAsian TV, which is trying to roll out a national cable-TV network with English-language programming for Asians. Adam Ware, Mnet's acting president and CEO, believes Asian-Americans have very different viewing patterns than other demographics, skewing toward shows with Asian-American actors, non-physical reality TV shows and adult-skewing animation. His network is trying to help marketers bridge the gap and overcome the misconception that you would need to program in 10 native languages in order to reach the Asian market, rather than create programming to reach the majority English speakers.
There is $3 billion spent annually on advertising to the Hispanic market, which has roughly $850 billion in spending power, so there should be roughly $1 billion to $2 billion spent on reaching the Asian community and its $550 billion in purchases, said Mr. Ware. Instead, he says, there is only $35 million.
5. Among the 37.7 million African-Americans counted in the 2010 Census, many are moving to the suburbs and back to the South. This can be viewed as a very positive indicator for this substantial market segment because when households move from a major city to the suburbs, or from one region to another, it is a sign of better job prospects and increasing affluence.
Eighteen states have more than a million African-American residents, with nearly 3 million residing in Georgia, where 30% of all residents are African-American. In each of five other South region states, more than one-quarter of all residents are African-American: Mississippi, Louisiana, Maryland, South Carolina and Alabama.
WHAT'S CENSUS WORTH, ANYWAY? A LOT, IN FACT
Ten years is a lifetime in defining consumer trends. So is the decennial Census really all that useful for agency planners, especially in light of the recent CBS and Nielsen efforts to replace demographics with behavior- and attitude-based segments?
"It's fine and slow," said Michael Fanuele, Fallon's chief strategy officer. "Neither of those are virtues in our world."
Even so, the answer is yes. The Census is the best source for showing macro-level trends in the population and the different ways they are taking hold in different parts of the nation. This is useful on the surface, but it also provides the backbone for weighting surveys to ensure a proper mix of respondents in consumer research the agencies conduct themselves.
"I'm looking at Census more in terms of ethnicity and life stages," said Rose Cameron, chief strategy officer at Euro RSCG, Chicago. "That is critical with regards to targeting, product development, media planning, etc."
Carol Foley, exec VP-director of research services at Leo Burnett, agrees. "When using products that measure size and composition of residents of various markets -- the MSA, for example, the Census is the source. Much database marketing and database analytics also relies heavily and appropriately on Census data."
But, she said, it's often the low-hanging fruit that should be used as just one piece of the puzzle in consumer research. "There tends to be a bit of an over-reliance on demographics. It's just very easy to capture that type of data (it's routinely appended to practically everything) and to get a mental picture of a target when you describe them in demographic terms -- young, upscale professionals, or stay-at-home suburban moms, or whatever."
Bernard Urban, president of Gigantic Marketing, New York, also thinks marketers need to go further in looking at consumer segments. "Smart marketers understand that to simply say 'white middle-income suburban moms are our target ' is a naive way of developing a consumer target for a brand." His agency, like the others, fills in the Census gaps with custom research and data from sources such as Mintel, the Pew Center, Gallup and Forrester. He also draws on data from the clients themselves. "I have yet to walk into a client that didn't have data that they felt they were getting enough out of," he said.
-- Matt Carmichael