In this article, we will talk about the 15 fastest-declining states in the US. You can also take a look at the 15 Fastest-Declining Large Cities in the US.
According to the US Census Bureau, while the US population will continue to rise, the growth rate is slowing considerably. Projections indicate a peak of nearly 370 million in 2080, followed by a slight decrease to 366 million by 2100. This represents a modest increase of only 9.7% over eight decades, underscoring a long-term trend of a flattening population curve.
One of the key reasons for the projected decline is the decrease in fertility and consequently, a falling birth rate. According to provisional data from the Centers for Disease Control and Prevention (CDC), the long-term decline in US fertility rates continued in 2023. There were about 3.6 million babies born that year, translating to a fertility rate of 54.4 live births per 1,000 women aged 15 to 44. This marks a new low for the country in over a century. The declining birth rates and better life expectancy are causing an aging population as well. According to a recent analysis by Morgan Stanley, the percentage of Americans aged 65 and over is projected to reach 24% by 2060.
However, the decline is not uniform across the nation. Southern states like Texas and Florida continue to be among the fastest-growing states, driven by factors like job opportunities and warmer weather. In contrast, many Rust Belt states in the Northeast and Midwest are experiencing population losses as residents migrate outward seeking better economic prospects. These states are also home to some of the fastest-shrinking cities such as New York City, NY, and Revere City, MA.
Key Investment Opportunities
Certain companies, such as UnitedHealth Group (NYSE:UNH), Welltower Inc. (NYSE:WELL), and American Healthcare REIT (NYSE:AHR), are expected to benefit from the trend of aging population and longevity.
UnitedHealth Group Incorporated (NYSE:UNH) is a multinational health insurance and services company headquartered in Minnesota. Unlike hospitals facing rising costs and lower collections, UnitedHealth Group Incorporated (NYSE:UNH) benefits from its focus on home-based care. The home care market is booming with an annual growth rate of 2.8%. UnitedHealth Group Incorporated (NYSE:UNH) owns key healthcare providers like Optum and LHC Group.
In addition to gaining exposure to healthcare providers, another strategy to capitalize on the aging US population is investing in healthcare REITs, which own or manage facilities that seniors will visit in their later years. Morgan Stanley projects that the number of residents in independent living, assisted living, and skilled nursing facilities will increase by 0.4 million to 2.1 million by 2030.
One stock that offers exposure to the healthcare REIT sector is Welltower Inc. (NYSE:WELL), a senior housing investment trust. Over 85% of Welltower’s properties are strategically located near hospitals. As hospitals deal with financial challenges and raise their prices, Welltower Inc.’s (NYSE:WELL) senior housing portfolio could benefit from increased demand.
Meanwhile, for those interested in small-cap senior housing investments, American Healthcare REIT, Inc. (NYSE:AHR) can be a suitable option. American Healthcare REIT, Inc. (NYSE:AHR) is a $1.7 billion company focused on outpatient facilities and senior housing. Regulatory barriers such as the requirement for a Certificate of Need (CON) in many states have made it challenging to construct the types of senior housing and outpatient medical facilities that American Healthcare REIT, Inc. (NYSE:AHR) offers. This could potentially benefit the company’s existing portfolio.
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Our Methodology
We shortlisted the 15 fastest-declining states in the US based on data from the US Census Bureau. We have ranked the states in ascending order of the percentage decline in population between 2020 and 2022. Furthermore, we have also shared the absolute decline in population for each state.
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Now, let’s begin our list of states that are losing population.
15 Fastest-Declining States in the US
15. Oregon
Percentage Change in Population: -0.11%
Population Decline: 4,658
Oregon used to be a popular destination for migrants from across the US. However, the state’s population started declining during the pandemic. Deaths significantly outpaced births. Furthermore, people also started leaving Oregon due to rising taxes and urban problems such as social issues, crime, and homelessness. The state recorded a 17% increase in its total violent index crime rate between 2020 and 2021. Oregon’s population declined by 0.11% between 2020 and 2022.
14. Maryland
Percentage Change in Population: -0.14%
Population Decline: 8,545
In recent years, many Marylanders have relocated to neighboring states or further south to Florida, Texas, or the Carolinas. Most of the state’s migration to other states or countries has been from the Washington-Baltimore corridor, with residents seeking smaller, more affordable areas. Maryland’s population declined by 0.14%, or 8,545 people between 2020 and 2022.
13. Pennsylvania
Percentage Change in Population: -0.17%
Population Decline: 22,432
Pennsylvania, located in the Mid-Atlantic and Northeastern regions of the US, is experiencing a population decline in counties such as Allegheny and Philadelphia. Many residents are relocating to other communities due to the high cost of living, heavy tax burden, and lack of job opportunities. Between July 1, 2020, and July 1, 2022, Pennsylvania lost over 20,000 residents. This decline in the Northeast and Midwest regions is largely attributed to negative net domestic migration.
12. Massachusetts
Percentage Change in Population: -0.20%
Population Decline: 13,755
Since the COVID-19 pandemic, thousands more individuals have been moving out of Massachusetts than into the state each year. Rising housing costs, particularly since 2020, have triggered a migration from Massachusetts. The majority of people leaving Massachusetts (58%), between April 2020 and July 2022, cited better job opportunities as their primary reason for leaving. Others were motivated by high taxation, seeking lower living costs, and a preference for less densely populated areas. Massachusetts ranks second on our list of the most expensive US states to live in.
11. Rhode Island
Percentage Change in Population: -0.24%
Population Decline: 2,611
Rhode Island, a state in New England, experienced a significant population decline between 2020 and 2022, with a decrease of 0.24%. The state’s population is expected to continue declining throughout this decade and beyond. According to a report by Pew Charitable Trust, Vermont, West Virginia, and Rhode Island are expected to experience the most significant population declines from 2020 to 2030. Population losses in the state have been predominantly concentrated in the Northeast. Furthermore, Rhode Island is in the fifth position on our list of the most congested states in the US.
10. New Mexico
Percentage Change in Population: -0.24%
Population Decline: 5,046
New Mexico is a landlocked state in the Southwestern region of the US. New Mexico’s population fell by 0.24% between 2021 and 2022, making it one of the fastest-declining states in the US. Several factors contribute to this decline, including issues such as inadequate public education, limited job opportunities, and a high crime rate. New Mexico is also one of the states with the highest high school dropout rates in the US.
9. Ohio
Percentage Change in Population: -0.35%
Population Decline: 41,459
Ohio ranks ninth on our list of the fastest-declining states in the US. Increased housing costs, rising interest rates, and overall uncertainty have prompted many people to leave the state. Job-related reasons are among the primary factors for those leaving Ohio (38.1%), followed by family considerations (20.6%). Surprisingly, Cleveland, one of Ohio’s most popular cities, has experienced the most rapid decline in population.
8. Michigan
Percentage Change in Population: -0.35%
Population Decline: 35,464
Michigan, known for its extensive freshwater coastline, is facing a population decline that’s expected to worsen in the coming decades. By 2050, the state could see nearly 700,000 fewer residents due to factors like low birth rates, shorter lifespans, and many young adults moving away. A significant portion of those leaving Michigan do so for job opportunities (30%) or to be closer to family (26%). Dearborn, Michigan’s fastest-shrinking city, lost 1.1% of its population in 2021.
7. Mississippi
Percentage Change in Population: -0.61%
Population Decline: 18,084
Mississippi, situated in the southern US with the Mississippi River to its west, is among the fastest-declining states in America. Its population dropped from 2,958,141 in 2020 to 2,940,057 in 2022 due to lower birth rates and increased out-migration. This decline poses challenges for the state’s workforce, with younger individuals leaving and difficulty attracting new ones. Mississippi is among the top 10 fastest-declining US states.
6. Hawaii
Percentage Change in Population: -0.75%
Population Decline: 10,847
Hawaii, known for its volcanic island chain in the Pacific, is experiencing rapid population decline. The Big Island is particularly affected, with older residents and retirees moving in while younger adults move out. This demographic shift worsens as it affects both the workforce and the potential for future growth. On average, from July 1, 2022, to July 1, 2023, the population of Hawaii experienced a daily decrease of 12 individuals. While there was a natural increase of 6 people per day, an average of 18 more individuals left Hawaii than arrived, leading to an overall decline in population.
5. West Virginia
Percentage Change in Population: -0.91%
Population Decline: 16,264
West Virginia, located in the eastern United States, continues to experience a decline in its population due to a significant disparity between deaths and births. Over the three-year period ending on July 1, 2023, the state recorded 89,419 deaths compared to only 55,715 births. West Virginia faces serious health challenges, including some of the highest rates of diabetes, heart disease, and obesity in the nation. Furthermore, the state is also known for having the highest drug overdose death rate in the country for several consecutive years.
