ECON First believes that business success centers around knowing the economic and demographic characteristics of their primary market area. While business experience, insights and intuition are important, they are substantially advanced by hard data.
The U.S. Bureau of the Census publishes annual data on mobility of individuals down to the county level. This data has profound implications for the marketing strategies of regional businesses.
Between 2015-16 over 11% of the population changed their place of residence. Almost 7% of these moves occurred within the same county and the other 4% ended up at locations in different counties than the one of origin…2.5% to a county in the same state and 1.5% to a completely different state.
While the overall mobility rate of the population has fallen from 19% just two decades ago, the 11% rate today is still important to business owners. It shows a continual churning within the geographic customer base.
For a business whose primary market area is a sub-portion of a county, as many as 11% of the area customers may be completely new each year. Although the business assumes that its reputation is well established and various market out reaches have saturated the residents, the mobility of the population means that this is obviously not true over time.
Given the mobility of households, over a five year period nearly half of the residents in a business’s sub-county market area may be different. This may amount to one-fifth of the customers in a county level market area.
And the rate of mobility will vary according to the characteristics of the residents in the businesses market area. Renter households, for example, are far more mobile that home owners. Young persons are far more likely to relocate than middle-aged married couples. And down-sizing households approaching retirement have high mobility.
The reasons for individuals moving vary but overall are not surprising. Family reasons, such as establishing one’s own household and a change in marital status, are cited in 28% of the moves. Over 23% of the moves are to obtain better housing, including to shift from renting to owning. And another 18% of the reasons given are job related.
MOBILITY VARIES BY COUNTY
Variation in economic conditions such job growth rates, tax levels, crime and the quality of public services all register as factors driving mobility between states and counties.
A frequently cited example is the state of Illinois where high taxes, corruption and a slow economy resulted in net out-migration of 83,200 persons from 2015-16. This encompassed net domestic out-migration of 114,200 and net international in-migration of 30,950.
Among Illinois’ counties, the leader was Cook County with net domestic out-migration of 66,244 and net international in-migration of 18,434. That is a lot of people moving.
Only 10 of Illinois’s 102 counties had net in-migration. The leader was Kendall County with domestic net in-migration of 553 and international net in-migration of 136.
ECON First specializes in providing the hard data that allows business owners to make more informed decisions regarding start-ups. expansion, marketing channels, and pricing strategies. The type and frequency of marketing campaign used by regional businesses should take into account the continual turnover of households through relocation.
Let ECON First help you to better understand your primary market.
Dr. John E. Stapleford