Is a bigger nation richer?

As the US population clock approaches 300 million, experts examine a possible link between growth and prosperity.

In a few weeks, the US population clock will tick past 300 million. It's a symbolic moment, and over the next five Tuesdays, the Monitor will explore the ways, both profound and mundane, that this number affects the economy, the environment, how we live, and what we hope to achieve. It reveals a present far different from the US at 200 million – and portends a future of equal or even greater change.

In the past 39 years, the United States has added 100 million people – the biggest population spurt in its history. At the same time, America has sustained greater economic growth than any civilization before it.

Is there a link?

While it's hard to prove that population growth spurs economic growth, experts say, the two often go hand in hand. That helps to explain why, by virtually any socioeconomic standard, most American workers are better off today than they were in 1967, the year the population reached 200 million.

The economy that boosted their earnings has also provided many more jobs, many of them in industries that didn't exist four decades ago.

So, the population rise has forced – or at least been accompanied by – dramatic change in the workplace.

Today's workers are less likely to build automobiles and more likely to stock shelves at Wal-Mart or spend their days in a cubicle peering at a computer screen. A far smaller share of workers belong to a union, and those who do often hold government jobs. The fastest-growing job types are computer design and support, systems analysis, desktop publishing, and healthcare.

The most significant change of all: the rise of women in the workforce.

When Billie Williamson joined the Ernst & Young accounting firm in Dallas 32 years ago, she was one of just four women in an office of 100 employees. There were no female partners or senior managers. Today, 40 percent of the firm's employees and 24 percent of its newest partners are women, and the retention rate for women is nearly equal to that of men.

Offices become family-friendly

The change goes beyond numbers.

"When I started," Ms. Williamson remembers, "we had no maternity policy, so when my daughter was born my boss told me I could take four weeks of vacation."

Today, employees get 12 weeks paid maternity leave and the option to start back on a flexible, reduced work schedule if they like. The company also has formalized its flexible work arrangements for men as well as women to take into consideration children, elderly relatives who may need care, and other family needs.

"We are trying to address all of the issues people may encounter in their personal lives in a productive way that allows them to stay with Ernst & Young and have a great career," says Williamson, who runs the company's flexibility and gender equity strategy for its offices throughout the Americas when she's not attending to clients as a partner in the firm.

Her trajectory mirrors the job gains of women, generally. Back in 1967, 41 percent worked outside the home. Today, it's 59 percent, a trend that's brought results beyond the paycheck.

"There can be little doubt that, on balance, a woman's expectation to earn a wage has been liberating," write the authors of "America by the Numbers," a 2001 look at the nation's demographic and social trends. At the same time, they observe, "the grand social transformation that many feminists hoped would follow ... remains far from complete."

More women may be wearing power suits, but advances have been slow. Just 16.4 percent of Fortune 500 companies have corporate officer positions held by women and only 11 Fortune 500 CEOs are women, according to Catalyst, a research and advocacy organization in New York. In some law school classes now, most of the students are women. But so far just 17 percent of law firm partners are female.

In terms of pay for work, women working full time are no longer earning 58 cents to the dollar paid men, as they were in 1967. But at 77 cents to the dollar, it's still far from equal. (The change is just as dramatic if men and women working part time are included. See chart at left.)

While men's median earnings remain stagnant at a bit less than they were in 1973, according to a recent report by the US Census Bureau, women's have increased by more than half. Still, at $23,546, median annual earnings for women are more than $10,000 a year less than they are for men.

One area where women have made noticeable advances since the height of the Vietnam War in 1967 is the armed services. They are flying fighter jets and helicopters, driving Humvees in Iraq, and commanding ships, squadrons, and ground units close to battlefields. Though they are prevented by law from serving in direct-action combat units, they are frequently in harm's way in Iraq where 56 women have been killed.

Double-amputee Tammy Duckworth, a former National Guard helicopter pilot shot down in Iraq, is running for the US Congress – another place where women are more likely to be found (and in leadership positions).

Overall, most Americans are better off than they would have been in 1967.

Real median household income has grown from $35,379 a year to $46,326. That's reflected in bigger houses; more cars; and more home entertainment centers, computers, cellphones, and other 21st-century gadgets.

Do more people mean more riches?

Does that prosperity have anything to do with population growth? Opinions differ, but at least in contrast to other developed countries many demographers and economists think so.

Families in Europe and Japan are not having enough children to keep their populations growing in the long term. That means their societies are aging rapidly. And it also stands in contrast to the US, which alone among the developed nations is expected to see its population surge in the coming decades. America's population growth is a function of three things: a fertility rate of just over two births per woman, a relatively high rate of immigration, and greater longevity.

"We're the envy of Europe and Japan for our population growth, for our level of fertility," says Samuel Preston, an economist and professor of demography at the University of Pennsylvania.

"Other Western societies are imperiled, I would say, by very low levels of child-bearing and their much-reduced ability to integrate immigrants into society," says Dr. Preston. "Their age structures are extremely antithetical to economic growth because they are so old and there is such a high burden of support required for the elderly population."

For US, a growing consumer market

Other experts note that a younger, growing population stimulates a workforce to produce more while energizing research and development and increasing the market for goods and services – all important in an age of globalization.

In a world economy that is increasingly "flat," as New York Times columnist and author Thomas Friedman puts it, having more immigrants may be important, too.

"For us to survive as an economic power we're going to have to not only trade with other people in the world but also bring a fair number of people here to be in our labor force, to help us understand how the rest of the world is operating," says William Frey a demographer with the University of Michigan and the Brookings Institution.

Payoff of a flat population?

Not every expert agrees with these assessments. "Nobody has yet proven that it's absolutely necessary to have population growth [to thrive economically]," says Martha Farnsworth Riche, former director of the US Census Bureau. "That's simply the model we all have in our heads. My personal belief is it doesn't have to be this way – that you can have economic well-being with a steady-state population."

Ireland, for example, has a fertility rate (1.87 births per woman) that is below the replacement level (2.1) – less than half what it was before the country lifted restrictions on contraception in 1979. Since then, Ireland's "dependency ratio" (the number of working-age people compared with the number too old or too young to work) has dropped considerably. In other words, there now are relatively more wage-earners paying taxes to support children and the elderly.

"That change coincides precisely with the country's extraordinary economic surge," Malcolm Gladwell writes in a recent issue of The New Yorker magazine.

"It depends on what policies a country has and how different sorts of social arrangements work, and all that," says Nicholas Eberstadt, a scholar in political economy at the American Enterprise Institute in Washington. "All other things being equal, which of course they never are, the prospects of moderate population growth, additional growth in the labor force, a moderated pace of population aging – all of those things one might imagine being positives rather than negatives from the standpoint of enhancing prosperity."

Moderation is the key. A nation's population can grow too fast and overwhelm its resources. In the United States, by contrast, the rate of growth is slowing. But the nation is adding more people than ever before in absolute numbers because the population base is so much bigger than it was.

Slow progress on poverty

Has there in fact been enhanced prosperity for Americans during these nearly four decades of extraordinary population growth?

There's general agreement, as Henry Paulson said in his recent debut speech as Treasury secretary, that "amid this country's strong economic expansion, many Americans simply aren't feeling the benefits."

Today's poverty rate is a bit less than it was when there were 200 million Americans in 1967 – 12.6 percent last year, according to a Census Bureau report last month.

But because the overall population has increased, the number of those in poverty has also grown – from 28 million to 37 million over the same period. Whether an individual is likely to be officially designated as poor depends in large part on race. For non- Hispanic whites the poverty rate is 8.3 percent; for African-Americans, 24.9 percent; and for those of Hispanic origin, 21.8 percent.

"The real incomes of lower- and middle-class households have fallen since 1970, while those of the top fifth have increased dramatically," according to "America by the Numbers." Census Bureau and Internal Revenue Service figures bear out this growing rich-poor gap.

But at the same time, says Mr. Eberstadt, "poor Americans have been enjoying progressively higher living standards. They have been on the escalator as well as everybody else." His research shows gains among the officially designated poor in areas such as health and nutrition, housing, auto and appliance ownership, and travel.

As the US population grows and moves around, where people live also can reflect relative economic prosperity – across the country and within states.

In Oregon, once heavily timbered, dozens of sawmills in rural areas have shut down while blossoming high-tech facilities near cities have given the place a new nickname: the Silicon Forest. The largest private employer in the state now is computer chipmaker Intel.

But economic demography may not be destiny. Last week Intel announced that it will eliminate more than 10,000 jobs worldwide.

Next week: The impact of immigration.

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