Where are people relocating? : Rooftop Views

Rooftop Views

Where are people relocating?

This article is by Lauren Sherman for forbes.com

Unemployment is on the rise, credit is tight, and consumers aren't spending--which means they aren't picking up and moving much either. Very few places in America saw significant population growth in 2008.

But the buzzing metropolitan area of Denver bucked that trend. Its population increased by 2.17% in 2008. In 2007, it increased by 2.09%. In 2008, Denver was the 10th-fastest growing metro area in the U.S.

What's Denver got that other places don't?

In Depth: 10 Cities Where Americans Are Relocating

For one, according to an October 2008 survey conducted by Pew Research Center, Denver is the most popular city in America. People like it for its skiing, culture and vibrant nightlife, as well as its business opportunities. As of January 2009, the metro area's unemployment rate was 6.5%. That's high, but still two percentage points below the national average of 8.5% for the same month.

Despite the overall economic slowdown, some parts of the country keep on moving ahead, attracting more and more newcomers--even if it's at a slower pace than in more sound economic times. These places still offer a semblance of stability, as well as great weather, cultural life and, in many cases, affordability.

Behind the Numbers
To determine the fastest-growing metro areas in the country, we used 2008 population estimates for metropolitan statistical areas with a population over 1 million, released March 19, 2009, by the U.S. Census Bureau. MSAs are geographic entities defined by the U.S. Office of Management and Budget for use by federal agencies in collecting, tabulating and publishing federal statistics.

We then compared the 2008 population estimates to the previous year's data to see which areas had grown the most, percentage-wise.

Nine places fared even better than Denver, though they share similar qualities: more business opportunities, better weather and more affordable housing. The top three areas according to the data are Raleigh, N.C., ranking first, which jumped 4.29% to nearly 1.9 million; Austin, Texas, which came in second, with a 3.77% increase to almost 1.7 million; and Charlotte, N.C., which moved up 3.36% to 1.7 million.

All these areas' increases were smaller in 2008 than they were in 2007, (Raleigh increased by 4.7% in 2007, Austin by 4.29% and Charlotte by 4.2%), but a slight slowdown is not necessarily a bad thing, according to William Frey, Ph.D., a demographer at the Brookings Institute, an independent research and policy group based in Washington, D.C. "Part of the story here is the rapid rise in growth in the middle of decade," says Frey. "That growth was unnatural."

The in-migration that happened in the middle of this decade certainly had a lot to do with the housing boom. When that went bust, so did those crazy population balloons. But these particular places are still growing because instead of building an economy that relies heavily on one industry (in Las Vegas, it's hospitality; in New York, it's finance), most of the metro areas on our list serve as headquarters for a diverse range of companies.

For example, Austin's biggest employers include University of Texas, Advanced Micro Devices (nyse: AMD - news - people ) and Dell (nasdaq: DELL - news - people ). That wide range might have something to do with the area's relatively low January 2009 unemployment rate of 6.4%.

This is the opposite of what happened in true housing boom-and-bust towns like Las Vegas. In 2004, Vegas--a foreclosure mecca--saw a population increase of 4.6%, followed by 3.66% in 2005, 3.98% in 2006 and 3.22% in 2007. In 2008, that number fell to 2%.

The Power of Business
When it comes down to it, a buzzing business community is a metro area's most important characteristic, says Sean C. Safford, a professor at the University of Chicago and author of Why the Garden Club Couldn't Save Youngstown: The Transformation of the Rust Belt. He studies the social economics of U.S. cities and metro areas.

"Perception is driven by the vibrancy of the companies in an area," he says.

However, that doesn't mean that these metros won't suffer from a slowdown in population when 2009's numbers are released next year. Charlotte, for example, reported a 10.5% unemployment rate for January 2009, likely related to the fact that Bank of America (nyse: BAC - news - people ) is headquartered there. That high unemployment rate almost guarantees stunted growth in 2009.

"We don't quite yet know what the impact [of the ongoing recession] will be for 2009 populations," says Frey. "But we do know it's not going to get any better."

Indeed, where Americans are relocating today has little to do with where they'll be moving tomorrow.