The voices of Urban Institute's researchers and staff
May 23, 2013

In America's cities, demographics must drive policy

May 23, 2013

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As millions of baby boomers reach retirement age, cities across the country will face unprecedented demand for housing, services, and health care. Urban Institute President Sarah Rosen Wartell sees opportunity for smart growth and investment amid that challenge.

Wartell spoke today at the first annual AtlanticLive Generations Forum hosted by The Atlantic. A series of panels with participants including Secretary of Transportation Ray LaHood and former Secretary of Housing and Urban Development Henry Cisneros tackled thorny issues about demographic change and how the millennial and boomer generations alike will deal with housing, transportation, city and neighborhood choice, and other issues.

“The same dynamics for housing demand are at play among baby boomers and millennials,” Wartell said.

As many boomers choose to “age in place,” that is, to retire and continue living in their homes and/or neighborhoods as opposed to in retirement homes, they will demand accessible transportation, services, walkability, and access to health care in their communities. These demands also characterize today’s young, educated, millennial generation.

Will cities and neighborhoods be able to cope with these interrelated demands? There are several key reasons for concern and also several important opportunities.

Areas for concern

  • Urban Institute models project that between 2010 and 2030 there will be a 70 percent increase in senior homeowners and a 100 percent increase in senior renters.

  • As many seniors choose to “age in place” by staying in their homes and communities, their cities and neighborhoods may not be equipped to provide the transportation, services, and health care they increasingly demand.

  • Affordable housing is limited, but retirees on fixed incomes and millennials facing an unprecedented wealth gap will increasingly demand affordable housing in walkable urban areas.

Reasons for optimism according to panelists

  • Health care will increasingly comprise the largest share of living expenses for seniors, but in-home care and other in-home services can reduce health care costs, and those cost savings can be reinvested in the services that generate them.

  • Social Impact Bonds and other public-private partnerships may be well-placed to make the initial investments in the many services that will be needed, increasing economic efficiency and generating profits.

  • Technology will allow many seniors to receive health care monitoring and service delivery in their homes, while millennials will use it to interact with and replace many neighborhood amenities.

In the closing session, Cisneros reiterated many of the points made by the panelists, saying that “demographics is destiny.” Changes in age cohorts, racial composition, and economic equality all illuminate what our future needs will be. Smart policy and planning can take advantage of this knowledge.

Further, he said, amid this general demographic sea change, our country’s minority population is booming just as millennials—and especially minority millennials—face growing wealth and income gaps. Boomers need those populations to reach the middle class to buy their homes, invest in their neighborhoods, and grow the economy. All of these issues will increasingly converge on America’s urban neighborhoods, where tomorrow’s demographics must drive today’s policy.

Photo courtesy The Atlantic/Kris Tripplaar

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