Susan Pendergrass speaks with J.S. Onésimo “Ness” Sandoval, demographer and professor in the Department of Sociology and Anthropology at Saint Louis University, about what the data says about the future of the St. Louis region. They discuss record low birth rates and what they mean for school enrollment, why St. Louis is among the top regions in the country for deaths outnumbering births, how the region compares to Pittsburgh and Cleveland, and why suburbs like Chesterfield and St. Charles are aging faster than most people realize. They also discuss the role of housing supply, school choice, crime, and domestic migration in whether St. Louis can attract and retain young families, and more.

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Episode Transcript

Susan Pendergrass (00:00): Well, certainly not the first time we’ve spoken, Dr. Sandoval. At St. Louis University, you are such a fascinating demographer of the region, and I’ve been following your work as new census data has been released. You’ve been writing about it and creating what I think are really cool mapping tools that folks can look at to see how the St. Louis region is impacted. Thanks for coming on to talk about that. But first I want to sort of expand our view, because pretty sure that I read within the last week that the number of babies born in the United States was at an all-time low. Is that right?

Ness Sandoval (00:35): Yeah, so every year the United States will probably be breaking records. The data coming out for 2025 is a record low, and the data coming out for 2026 is even lower. The first few months of 2026, the provisional data that’s out shows even fewer. And this is what we expected. We call this a demographic shock, because in 2026, whenever you create an atmosphere of uncertainty and fear, rational people do not have children until they understand that their job is safe, there’s not a recession coming, and we’re not at war. When you create this sense of fear, young people do the rational thing and don’t have children. We saw this in 2020 with COVID. We saw this in 2008 with the Great Recession. Anytime there is uncertainty, young people will postpone births. And that’s what we’re seeing. This started in November. We started to see the decline in births, and it’s continued from November, December, January, February. And so this is what we’re going to see.

Susan Pendergrass (01:51): So next year is going to be lower. And when you look at the state of Missouri, I’ve been saying this ad nauseum for years that our K-12 school enrollment is declining and will decline because of that sort of peak in 2008, just before the Great Recession. So our biggest kindergarten class was around 2012, and our kindergarten classes have by and large declined ever since. And so those kids are moving through the system. You can project that we will just have fewer and fewer kids enrolled in our K-12 system in the state of Missouri.

Ness Sandoval (02:06): No, we peaked in 2008.

Susan Pendergrass (02:11): By and large declined ever since 2012. And so those kids are moving through the system. So you can project that we will just have fewer and fewer kids enrolled in our K-12 system in the state of Missouri.

Ness Sandoval (02:24): Yeah, this is true, and we have a pretty good chart. We make these for every city. We’re replacing very large cohorts of children who were born. I have a son who was born in 2007, just before the recession. That cohort that graduated in St. Louis was 40,000 students. The baby birth cohort is now 27,000 students. So that’s just in that one year a 13,000 decline. And it’s going to decline every year for the next 15 to 18 years, because we don’t know what the bottom is yet. It has not reached the bottom.

Susan Pendergrass (03:01): Right. People say where are the kids going? I’m like, they’re not going anywhere. They weren’t born. The St. Louis region, like Clayton is declining, Ladue was, I mean, all of these school districts, I think almost everyone in the county has fewer kids today than they had 10 years ago.

Ness Sandoval (03:07): They weren’t born. Yes, and it’s not just St. Louis County. St. Charles County is experiencing this. There are some parts that are growing, in the Wentzville area, O’Fallon, but if you look at the old St. Charles areas, they’re experiencing decline. Families with children are declining in those areas. We had made an interactive map that I think shocked a lot of people, of seniors outnumbering youth. People could not comprehend this. Like, my gosh, this is not 2000 where youth were dominating these neighborhoods. I live out here in Chesterfield. The entire Route 64 corridor is senior citizens dominating the youth in Chesterfield. People are shocked. More seniors lived in Chesterfield than youth in 2010, and that’s only grown since. This is happening throughout West County.

Susan Pendergrass (04:14): Wow. And your maps actually go down to the zip code, right? You have very granular data.

Ness Sandoval (04:27): Across into Illinois, yes. The only way you can turn this around is young people from across the United States deciding that they want to make St. Louis their home, have a family there, create a business there. This is what I promote. We have to get younger. We really should have a preferential option for families with children. And that’s a hard message for a lot of people because they’re like, wait a minute, we grew from 1970 to 2020. And I’m like, but all of that growth was driven by babies born. Over 1.8 million babies were born. And I tell people, just do the math. 27,000 babies per year times 50. That’s the back of the envelope for what’s coming over the next 50 years. Unfortunately, that’s not what’s going to come. It’s going to be a lot lower than that. People are starting to get it. We’re not going to have 1.8 million babies born over the next 50 years.

Susan Pendergrass (05:33): Yeah, and I think about things like individual school systems building new elementary schools when there have got to be a lot of buildings that are empty. And also, won’t there be more competition for public resources between children and older people?

Ness Sandoval (05:49): Yeah. At my previous job at Northwestern, we did a project on this in one of the suburbs because we were studying seniors. There was a debate about how to spend public money. Was it for transit for seniors or transit for children? This was 2006, and this was the debate happening in Chicago. How do you provide paratransit for senior citizens when that number is increasing? We’re just having this discussion because St. Louis is leading. We’re in the top three of regions. Pittsburgh leads the country, Cleveland is second, and St. Louis is third, tied with Tampa. More people dying than babies born. We simply don’t have the number of babies born for the size of our population. And it’s because we’re a very old region. We’re the ninth oldest region in the country.

Susan Pendergrass (06:58): Yeah, I mean, we used to have 800,000 people in the city of St. Louis, right? And now we’re 280,000 or something.

Ness Sandoval (07:05): Yeah, and I was just looking at the numbers. It is very possible within two years that Kansas City will have more babies born in absolute numbers than the St. Louis metro region. That’s how few babies. I’m talking about the region. Indianapolis is about 700 babies behind St. Louis. Nashville is about 800 babies behind. All of these smaller regions are having lots of babies, and young people are moving there. Your future depends on the number of children born. And when you look at population projections, I kind of know what this looks like. When you fall below Kansas City in number of births, at some point Kansas City will be larger than St. Louis. We can project this out. We’re talking absolute births, not birth rates. We had lots of babies born 10 years ago. We were fine 10 years ago.

Susan Pendergrass (08:09): Yeah, wow.

Ness Sandoval (08:29): We can go back and talk about what happened since 2010.

Susan Pendergrass (08:35): Yeah, please. I’m curious what did happen. I know you call it the death spiral when there’s more deaths than births, but how did we get into this?

Ness Sandoval (08:41): So I moved here for the Great Recession. I moved in 2008 to start my job at SLU. And there was hope when I got here. There was some positive momentum happening. I think the region took it for granted that it didn’t have to do anything. We just have to be St. Louis. We don’t have to do anything. Unfortunately, Nashville came on the scene. Then you started to see regions change. Regions thinking we need to get young. And St. Louis absolutely did nothing. Since I’ve lived here, there’s been a lot of resistance to economic development in the region. Nashville, I think it was the popularity of being young, being pro-development. I went to Nashville to actually look at it, like why are young people there? And I went to Vanderbilt. And I saw this really interesting integration between the city and Vanderbilt University. That does not exist here in St. Louis. Making it a vibrant, cohesive, urban experience.

Susan Pendergrass (09:47): Yeah. Right. Now you step off campus at SLU and you’re in an area you don’t want to walk at night.

Ness Sandoval (10:00): Yeah, and even if it was WashU, right. And then you can talk about the Loop. It never recovered from COVID, traffic is down. I think the region has really struggled to attract young people to stay here and live here.

Susan Pendergrass (10:13): Well, we’ve been looking into the issue of crime in St. Louis quite a bit, and I know it’s down and everyone’s celebrating that fact, but I’m not sure when you survey people and ask how they feel walking alone at night, that it’s changed all that much. Even if the number of murders are down, I don’t know that people feel safer walking alone at night, and that’s got to have an impact on whether you want to stay in St. Louis after you have kids.

Ness Sandoval (10:47): Yeah. I think in the city you move out to the suburbs. The challenge is they work and you live for affordability. So many suburbs are against new development, even though they can develop. We see these debates in Chesterfield, that debate in Creve Coeur, several debates out in St. Charles. They don’t even talk about Jefferson County, because they’re celebrating voting down housing. My point is if you don’t want to build housing, Indianapolis is going to build it. Columbus is going to build it. Nashville is building it. We are no longer in the top 50 in new housing permits in the country. We’re 58th.

Susan Pendergrass (11:34): Why though? Is it because there’s not demand, or is supply being constrained?

Ness Sandoval (11:42): Supply is being constrained. Part of it is, when I speak to people, they say it’s going to hurt my home values. People want supply down. But you understand there’s a consequence to this. And home values are always good in St. Louis. But again, we always say there’s a city that we can look to that’s our future, and that’s Pittsburgh. If you really study Pittsburgh and look at it, you’re like, wow, there’s a lot of things we can learn as a city, and say this is not what we want to be. Pittsburgh leads the country in discounted rates on home sales. When people offer their price, most people do not get the price that they want. It’s a significant discount because the demand’s not there. We are about 20 years behind Pittsburgh.

Susan Pendergrass (12:25): Wow. I think a lot, in what I do, about the educational offerings in the region. Before we were recording we were talking about Texas. Texas, number one, doesn’t have an income tax, and also you can pick your child’s school from the get-go. They have hundreds, if not thousands of charter schools. And now they have a private school choice program that I think 250,000 families apply to. And Missouri has an extremely limited private school choice program, maybe 6,000 or 7,000 kids in the state, and not even the ability within St. Louis County to go outside of these tiny little districts. You can’t even go from Clayton to Brentwood. People really feel strongly about this and fight the idea of opening up the county and letting kids go within the county to any school district, and then the legislature fights it every year. And I’m like, we are just becoming less and less competitive.

Ness Sandoval (13:36): I don’t think people understand. I do a lot of work with schools now. We’re going to lose at a minimum 100,000 children under 15 by 2045. This loss is built into the system based on 27,000 births right now. The numbers are starting to show up in kindergarten. We have a smaller kindergarten class, a smaller first grade class coming in. And so a lot of schools are like, wait a minute, what’s going on? This is just starting. You have another 20 years, because we have these large cohorts that were still born after the Great Recession that are going to be replaced by smaller cohorts coming in. And there is no significant migration of children coming into the region.

Susan Pendergrass (14:28): So there are going to be difficult staffing decisions, and people don’t want to hear it. Like, we cannot continue to hire more teachers.

Ness Sandoval (14:32): You have to close schools. You have to close schools, have to merge schools. I’m doing some work in Parkway. People should not be surprised. Parkway is having meetings this month about what Parkway looks like going forward, and people are discussing consolidation. Rockwood is talking about a 15% decline in 10 years. Go out another 10 years, Rockwood will be talking about school consolidation. St. Charles will be talking about school consolidation in the old St. Charles area, the city of St. Charles. This is coming. Everybody focuses on the city and says the city needs to close schools. But you will see a discussion, I think, between Clayton and Brentwood.

Susan Pendergrass (15:06): For sure. Clayton had 2,500 kids. Now they’ve got closer to 2,000. I mean, that’s teachers, that’s buildings. And I know in Indianapolis, I’ve talked to a superintendent in that area. All parents can pick a public school. And he was like, I had some under-enrolled elementary schools and it was great for me because I put a language immersion program in one to bring parents in. I think the resistance to this idea is all about not wanting kids who aren’t paying property taxes, but I think it’s going to flip. Then you’ll be like, we’ve got to fill these seats. We’re paying the same teacher for 18 seats that we could pay for 22 kids. At some point they’re going to have to start laying off teachers. So I think there are some very difficult decisions ahead that you can see now, and there are things that could be done now, like at least not filling open positions.

Ness Sandoval (16:16): I think universities are seeing this, because many of them are relying on tuition and those dollars are not coming in. A smart university has to make cuts because it doesn’t get any better next year or the following year. There will be fewer students coming in. So universities that want to survive are making necessary cuts to survive.

Ness Sandoval (16:45): Again, we don’t know what the bottom of the birth decline looks like. We just happen to live in a state and a region that has seen a significant decline in children. I keep saying we’re modeling the future for people, either as a good or bad thing. They’re like, we want to be like St. Louis, or we don’t want to do what they did.

Ness Sandoval (17:13): I think a lot of people are starting to understand this. It’s like, we’re letting our children go, and we’re not doing a very good job of trying to keep them here. When you had 1.8 million births, you had enough to let children leave your region, leave the state. You don’t have that luxury anymore. Our models show the region should have anywhere between 1.3 million to a million births coming in over the next 50 years. We hope it’s not a million births, because that means you have an 800,000 decline in your population under 50. Or it’s 1.3 million births, which is only a 500,000 decline. But that’s coming.

Susan Pendergrass (17:43): How does immigration factor into it? Because I remember the last time we talked, you said that St. Louis is not very immigration friendly. And of course, the current national environment is not very immigration friendly.

Ness Sandoval (18:03): Missouri and St. Louis cannot rely on immigration to save it. It’s not a state that immigrants are going to come to in large numbers. They’re going to go to Florida. Miami leads the country. Even though domestic migration has people leaving, international migrants are going there as their top destination. They’re going to Philadelphia, they’re going to New York. We get immigrants who come here, but it’s a very small number, like 6,000 a year. We’re not even in the top tier as a top 25 metropolitan region. And Missouri is not either. So Missouri has to rely on domestic migration.

The data will show that probably for the decade, there will be more people dying than babies born in Missouri. Missouri will start to have from a natural perspective more people dying than babies born. And 91 counties across the whole state will have more people dying than babies born. So Missouri will become dependent for growth on domestic migration.

Susan Pendergrass (19:29): Or do we just accept that we’re not going to grow anymore? What’s the impact of that?

Ness Sandoval (19:33): Again, it’s going to be specific. I do think the Springfield area is going to grow, the Branson area, there’s growth. Part of this is retirement, I think. Kansas City is growing.

Susan Pendergrass (19:42): Why Kansas City more than St. Louis? What’s attracting younger people to Kansas City that is not happening here?

Ness Sandoval (19:49): Kansas City is a younger region. St. Louis is a fairly old region. Kansas City is a lot younger and it has a large Latino population, and that’s the largest growing population in the country, birth-rate wise. Latinos are now the second largest population in Kansas City. They surpassed the Black population, which I think even shocked me, because we thought we knew this was coming, but we thought this was going to be post-2030. The fact that it already happened shows just how many Latinos are moving there. And then you have an exodus of Black residents leaving Kansas City as well as St. Louis. I always tell people, when you have young Black families leave or young Black adults leave, those children ultimately leave too. And so that’s part of the story.

Ness Sandoval (20:48): When young people leave, the children that traditionally were born to those young people are now being born in Charlotte, Atlanta, Houston. The number one challenge for St. Louis and the state is the decline in births. If that doesn’t change, then you’re going to see that decline start to show up in five to ten years in our schools.

Ness Sandoval (21:17): And the private schools will simply go out of business because that’s dictated by the private market. Or they’ll do what many of the Catholic schools are doing. They think, we’re going to have middle school now, or we’re going to be K through 12. But then what about the parochial schools? There’s no growth. They’re just taking children out of other schools and putting them in their school system.

Ness Sandoval (21:45): And so again, I go back to Pittsburgh. Pittsburgh is about how do we manage population decline? The city is growing a little bit, but 100% of the growth in terms of the losses is in the suburbs. And that’s going to happen in St. Louis. When this loss starts to show up in the demographic accounting, most of the loss is going to be outside of the city of St. Louis. It’s going to be in the Chesterfield areas. It’s going to be in St. Charles.

Susan Pendergrass (22:18): So what could be done from a policy perspective? Chesterfield is trying to have this arts and entertainment district. They put in Topgolf and the concert venues. They’re trying to attract younger people there. Is it working?

Ness Sandoval (22:34): It’s not working. I mean, they have the same slight increase. I just posted this yesterday. People are shocked. The growth is in non-family households in Chesterfield. If you look at the new development, I call it downtown West Chesterfield. These are million-dollar homes, very expensive. Very few families with kids are there. These are empty nesters or dual-income, no-kids households. It’s very expensive for young families to get into Chesterfield today, when your entry-level home that was $170,000 in 1980 is $600,000 today. These are the challenges.

Susan Pendergrass (23:23): So build more starter homes?

Ness Sandoval (23:32): You need more entry-level homes. I’m not even going to use the word affordable. You need attainable homes for two incomes. And they can be built. But what I’ve heard is that a lot of cities do not want these homes. They want the $600,000 to $700,000 homes because of taxes. And so there is this tension there.

Ness Sandoval (23:56): Parkway and Rockwood are going to look very different in 30 years. They were very attractive amenities for young families with children. But I look at the data, and my kids are in Parkway. These schools are under-enrolled. You go and objectively look at the classrooms, you’re like, there should be 30 kids in these rooms and there’s 15. It’s great for me as a parent. I’m glad there’s only 15 kids for my fourth grader. One of the classes in Parkway Central, in the middle school, in his math class, there are eight students. I love it as a parent, but as someone who looks at the data, this is not sustainable.

Susan Pendergrass (24:45): Yeah, lots of one-on-one. Yeah. I’m just trying to figure out what would cause a renaissance in St. Louis. It doesn’t feel super safe. It has some great amenities and a great food scene and now MLS soccer. What would it take? Well, number one, you do have the school system problem where the St. Louis public school system is kind of a dumpster fire. So people want to move out if they have small children.

Ness Sandoval (25:32): Yeah, the decision to move out is made within the first three years once the baby’s born. We can see that in the data. When we moved from Chicago, because we lived in the city of Chicago, we wanted to live in the city of St. Louis. I think most people who move from Philadelphia or Boston are living in the city. We thought the city of St. Louis would be offering the same amenities. Because of the Great Recession, I came a year before my family, and we soon realized the city of St. Louis was not the city of Chicago in terms of amenities. And so we ended up in St. Charles. And I think most people make that same decision.

Susan Pendergrass (26:25): Yeah, my husband and I moved right into the city.

Ness Sandoval (26:27): We see it in the data. People are moving into the city from Philadelphia, from Boston, from Houston. But then, like me, if you have children and you’re not going to pay for private school, because that’s a tax in many ways, they’re going to exit out. And then with the Catholic schools closing in the city, there are going to be fewer options.

Susan Pendergrass (26:50): Yeah. But the public transportation is no good. I mean, there are things.

Ness Sandoval (26:57): And it’s interesting. We did see a kind of experiment during COVID. When COVID happened, the Catholic schools in the county opened up. A lot of families wanted their children in face-to-face instruction. So they left the city. They did not stay. So we had kind of a quasi-experimental design there. Education was very important.

Ness Sandoval (27:26): A lot of people left the city because of that and never came back. And that started before COVID. But I think this idea of school choice is something where parents want it. We have enough anecdotal evidence. When Normandy closed, the school system closed, families moved to Normandy to get their kids into Francis Howell. There’s enough evidence to show that families want to make these decisions. The question would be, would Parkway accept all of the students that would want to be in Parkway?

Susan Pendergrass (27:56): Yeah, the law would have to say that they would have to. You couldn’t let them pick and choose.

Ness Sandoval (28:15): Yeah. And so the question is, you have a lot of people who would love to be in Parkway. I gave a talk at Marquette and I was shocked because a good percentage of the students there were saying those public school students, but the parents had left to get out to West County for their children. So the question is, do you just let the private market dictate this? Those who can leave the city will ultimately leave the city and get out to West County.

Susan Pendergrass (28:50): There’s movement out. And I think in terms of domestic migration, to get parents to move in, you can go to our northern border, Iowa. The state pays for private school tuition. Oklahoma to the south, the state pays for private school tuition. Kansas, you can go to any public school in the state. It’s 100% open enrollment. Arkansas is one of the strongest for school choice, both public and private. I think we’re going to be surrounded by it and just have our arms folded across our chest. Because Parkway doesn’t want all those kids coming, or Rockwood doesn’t want all those kids coming. Parents are simply going to move across the border to a state where they can pick any public or private school. I’ve talked to some parents who have reached out to say, I’m thinking about moving to the region, is it true I can’t pick a school? And I’m like, it is true. You cannot pick a school. And I think they’re like, forget it. I’m not going to make this big decision on where to buy a house. I think if we don’t do things that are family friendly, and if we don’t get crime under control in some way, or have a 911 system where when you call somebody responds, I think it’s interesting that St. Louis will become this example for the nation of what a dying city looks like.

Ness Sandoval (30:08): We have three examples today: Pittsburgh, Cleveland, and St. Louis. Tampa is kind of unique because it is a destination for retirees. The Wall Street Journal has an article today on Cleveland, the renaissance of downtown Cleveland. And Detroit too, it’s a renaissance.

Susan Pendergrass (30:29): Wow. What about Detroit now? So St. Louis hasn’t figured out our renaissance yet.

Ness Sandoval (30:49): And to be honest with you, I think it will be hard. I’m not pro anything, but I find this whole debate about the city and county interesting. I’m not from here, so I don’t have this history of growing up here. But I think objectively, when I look at the budget of the city of St. Louis and compare it to Pittsburgh, Pittsburgh is a little bit bigger. It’s got 25,000 more people. But their budget is significantly smaller than St. Louis City’s budget. Part of me wonders, because the city is both a city and a county, it doesn’t have enough people or revenue to operate as both. And this is what’s helping Pittsburgh out. This is what’s helping Cleveland out, because that county revenue is spread among more taxpayers. In St. Louis City, the county functions are spread among a dwindling number of taxpayers. The city probably cannot be a county anymore. There’s just too few taxpayers to provide both city services and county services.

Ness Sandoval (32:08): I looked at these budgets and I’m like, my gosh, why is St. Louis’s budget so much more? I’m talking not a little bit more, a lot more than Pittsburgh’s budget. Pittsburgh is having trouble. And I don’t see the long-term fiscal situation turning around for the city because it’s got to provide all of these services. The tax base is going to decline. The next three years are probably going to see population loss in the city. The numbers just came out in March, but we’ll get the numbers in May. It’ll probably lead the country again in population decline for large cities.

Susan Pendergrass (32:58): Are we still a top 20 city? We’re number one in population decline, but what about in population size?

Ness Sandoval (33:01): We’re number one in decline. Last year, St. Louis City was number one. We’re declining. We’re not in the top 20 yet, but we’re very close. If we go back to 2020, we’re smaller than we were in 2020. The only reason we’re not number one in decline is because we had so many immigrants that offset our domestic migration loss. But this will be an interesting 2030 census, because it’ll be the first time the region will go into a census with more people dying than babies born. In the last census, we had about 75,000 natural growth. We’re looking at about 25,000 to 30,000 natural decline going into this census without any domestic migration. I tell people that this story is just starting. We have 74 years of the century left.

Ness Sandoval (34:18): I’m just trying to get people to move from the mindset that this is 2010 St. Louis. You don’t have 36,000 births anymore. You have 27,000 and it’s declining, one of the fastest declines in the country. Because of it, we’re aging very fast, and so we have to shift. The region has to make a choice that we start to organize our economy around senior citizens. There’s lots of money to be made from senior citizens, but we will never be viewed as Nashville or Austin as a place for young people.

Susan Pendergrass (34:52): Absolutely. That Route 64 corridor is just going to be all retirement homes.

Ness Sandoval (35:04): We won’t be talking about single family homes anymore. We’ll be talking about senior housing. We’ll be talking about a workforce that’s going to work with seniors instead of a workforce for children. And there is money to be made in that economy. I’m not saying that this is a bad thing. But again, we can look at other parts of the country where this transition has happened. Local government spending is being consumed by senior citizens, the healthcare of senior citizens, the paratransit of seniors. Seniors will lose their ability to drive. That cost typically gets covered by local governments. And so you will not be providing buses for children. You’ll be providing paratransit to get seniors to their doctors. Churches will have to think about being accessible to seniors. I go to Church of the Ascension and they are not prepared. At Easter, one of the Masses, one-third of this section was senior citizens in wheelchairs. The churches are simply not prepared for a parish that’s going to be 50% of the population at 70 years old and older. Restaurants have to think about this.

Susan Pendergrass (36:30): Wow, that’s crazy. Well, interesting stuff. I hope you’ll come back and talk about this more. And certainly I’m very interested in reading everything that you write about what St. Louis can do. We need to figure out a renaissance.

Ness Sandoval (36:51): We’ve got to get younger. The kids are giving us a try. They’re coming to school, they’re coming here because they have hopes. We just have not responded the way we need to. A lot of companies are starting to recognize this. I talked to the mayor and said, you need to be a more proactive voice on this. But the region, this is not a city of St. Louis issue. This is a St. Charles issue, a Jefferson County issue, a Chesterfield issue. Most of the people live outside of St. Louis city. The loss we’re projecting is going to come from the suburbs. And that’s what’s happening in Pittsburgh, that’s what’s happening in Cleveland. 100% of the demographic loss is in the suburbs.

Susan Pendergrass (37:21): Yeah. Wow, that’s crazy. Well, fascinating. Thank you so much for explaining it. I don’t want to be depressed about it, but it’s not super optimistic. We’ll find a silver lining. Thanks, Dr. Sandoval.

Ness Sandoval (37:59): All right, thank you very much.

Produced by Show-Me Opportunity

The post St. Louis Demographics and the Future of the Region with Ness Sandoval appeared first on Show-Me Institute.

Many people simply do not feel safe in St. Louis. As a city resident, I have incorporated several different habits while living in the city. To name two, I look both ways at every single green light and I ensure nothing of value is visible in my car. Auto thefts have been on the rise, and in particular, thefts of two brands (Hyundai and Kia) have soared from 273 to 3,958 in the past year in the City of St. Louis.

While there is a specific design flaw that has led to Kia and Hyundai thefts skyrocketing, the lack of punishment and deterrence might be contributing to rising vehicle crime in the city. From August 1 to August 13 in 2022, 462 cars were stolen or attempted stolen in the City of St. Louis. Yet despite the surge in auto thefts, only 1 person was charged in city courts for a crime related to auto theft during the same two week period. Whether this is due to lack of punishment or lack of law enforcement capacity to find the culprits, city residents are suffering all the same.

The lack of regard for traffic rules visible on a daily basis. For example, the day I wrote this piece, my coworker and I saw someone drive into oncoming traffic on Kingshighway Blvd, veer in front of someone turning left from the adjacent street, and blatantly run a red light. These everyday close calls can turn into fatal crashes. Despite a declining population, 230 people were killed in traffic crashes in the City of St. Louis City from 2020–2022 (with a 20 year record high of 81 in 2020) as compared to 128 from 2008–2010.

While there has been a national increase in traffic fatalities in recent years, it seems fair to wonder if local policy in St. Louis has exacerbated that trend. Even as reckless driving has seemed to increase, vehicle stops in the city have declined from their peak of 85,622 in 2009 to 45,124 in 2021. Similarly, traffic citations have decreased from 34,833 in 2009 to 17,763 in 2021. Again, whether this is due to a decision to not punish this type of crime or a lack of capacity to effectively patrol the streets, City of St. Louis residents suffer the consequences all the same.

The decline of a proud and historic city like St. Louis is a sad thing to witness. We are known as the Gateway to the West, yet sadly our streets right now more closely resemble the Wild West. If city leaders want to attract new residents and prevent current residents from leaving, they need to get a serious handle on the public safety issue, and they need to do it quickly.

The post How to Lose a City of St. Louis Guy in 10 Days appeared first on Show-Me Institute.

The number of people who live in the city of St. Louis fell below 300,000 in 2021 and the metropolitan area also saw a decline in population as the region for the first time recorded more deaths than births. That puts it among just a handful of large urban areas hit by outmigration and a negative birth rate. . . .

As of July 1, the Census Bureau estimated that just 293,310 people resided in the region’s core city of St. Louis, down from the 301,578 people counted in the 2020 census.

St. Louis City had a population of more than 850,000 in the 1950 census. That means today’s population is about a third of what it once was. Deaths outpacing births for the first time in recorded history does not seem like great news, either.

Not all of this is the fault of the city’s leadership. Structural factors are certainly at play here; there are many reasons St. Louis’s population has been in precipitous freefall for more than half a century. And COVID deaths across the country did depress population gains. But that does not mean decline is inevitable.

As noted in the Post-Dispatch article, several peer cities in the Midwest, including Kansas City, Indianapolis, and Cincinnati, experienced population increases over this period. Those cities have many similarities to St. Louis. And St. Louis retains many key advantages, including its central location as a transportation hub and a low cost of living. To quote the late Charles Krauthammer: Decline is a choice.

So what now? A few quotes from the Post-Dispatch article hint at one possible way forward:

The numbers drew another call from the St. Louis metro’s new business and civic booster group for regional unity and a redoubling of efforts by area leaders to draw residents and focus on “inclusive economic growth.” . . .

“At the start of last year, we established Greater St. Louis Inc. out of the core belief that growth must be a top civic priority for the St. Louis metro,” said Greater St. Louis Inc. CEO Jason Hall. “These numbers tell us what we expected and underscore the urgency of focusing this metro on growth and more opportunities for all. Stagnation is the existential threat to everything we love about the place we call home.”

I’m not exactly certain what “inclusive growth” means—I would think that a region that has been hemorrhaging population since the Eisenhower administration should just be focusing on any growth, absent qualifiers. I am not mentioning this phrase just to be snarky, but instead because it is indicative of how St. Louis leaders have approached this problem.

Greater St. Louis, to much fanfare, introduced a plan at the end of 2020 (revised and improved in early 2021, but without significant changes) that was intended to fix what ailed the St. Louis region. Show-Me Institute analysts pointed out the inadequacies of that plan at the time. One of the major problems with the report is that it’s long on buzzwords and jargon like “inclusive growth” and short on actual concrete policy prescriptions or solutions.

I don’t want to belabor the shortcomings of this one report from two years ago. But that report illustrates how many civic leaders in the St. Louis region think, and it represents a well-trod path: Use taxpayer dollars to bribe companies to move here, use even more taxpayer dollars to pay for splashy but economically dubious projects like aquariums or soccer stadiums or trolleys, and bend to the whims and demands of social justice activists when making key decisions.

It’s not that hard to think of a better way to try and make St. Louis a more attractive place to live and work. St. Louis City still has an economically destructive earnings tax. The city also has massive problems with crime. The city could also focus on reducing regulations to improve its ease-of-doing-business rankings. The region as a whole could stop giving away tax subsidies at every available opportunity and use some of that money to fund critical public services or cut taxes.

It would be easy to keep listing examples of what the St. Louis region could or should be doing. But maybe the best argument for trying something else is a simple one: The old approach is what got St. Louis into its current atrophied state. If we keep trying the same things, why would anyone expect things to change?

The post Honey, I Shrunk the City appeared first on Show-Me Institute.

The growth of the St. Louis MSA, which contains 7 counties in Missouri and 8 counties in Illinois, has been stagnant for years, driven in no small part by poor population growth in St. Louis City. While some lawmakers were pleasantly surprised that our 2020 numbers weren’t worse, I’m disappointed at what has become of a once booming and prosperous Midwestern region.

What is it that keeps St. Louis out of the race?

Maybe it’s the sales tax rates that can be over 11 percent. Or the earnings tax in St. Louis City. Perhaps it’s the poor public schools and lack of school choice. Or the crime. It’s likely a mix of all these things and more; anything that makes St. Louis a less attractive place to live, work, or start a business has negative effects on population growth. You would think that years of stagnant growth would inspire lawmakers to take steps in the right direction, but we’ve seen little change. Maybe this fall from the top 20 will finally light a fire under lawmakers.

The post We’re Not in Last Place—We’re Not Even in the Race appeared first on Show-Me Institute.

In general, economic theory tells us that local income taxes have negative effects on population and economic growth in the cities that have them. Not only do these taxes discourage earning an income, but they are easy to avoid by moving or relocating businesses. This makes localities that have local income taxes less competitive relative to surrounding localities and encourages people to make the short move to where they can keep more of their hard-earned money.

We’ve seen this play out in the St. Louis area, especially regarding population; it’s fairly common to hear about people and businesses moving from the city to the county. St. Louis County does not have an earnings tax and the county’s population decreased by 0.46 percent from 2010 to 2019. The City of St. Louis, on the other hand, has a 1 percent earnings tax and has seen a staggering population decline for years. The city’s population decreased by 5.87 percent in the same period—that’s more than 12 times as much as the county. And just a little bit further from the city, St Charles county’s population increased by 11.12 percent in the same period.

Many factors can contribute to population decline; an additional tax on income is certainly one of them. Economic theory suggests that Multnomah County may see its local income tax hike have negative effects on population and economic growth. St. Louis can confirm that with experience. If they’d asked, we would’ve told policymakers this is a bad idea for their county.

The post Multnomah County, Oregon Should’ve Called St. Louis Before Making This Mistake appeared first on Show-Me Institute.

A recent report from business resource AdvisorSmith analyzes population data of cities with more than 250,000 residents. With a compound annual growth rate of −1.1 percent, St. Louis tops the list as the fastest-shrinking city. This means that St. Louis City’s population fell by an average of 1.1 percent each year from 2014 to 2019. That’s a huge difference from the fastest-growing cities; Henderson, Nevada, and Irvine, California, both grew by an average of 3.1 percent each year over the same period.

So why is St. Louis shrinking?

It’s probably a combination of many things. High crime   and poor school performance certainly play a part, but there are other problems. Policies that place onerous burdens on businesses and residents can prevent both economic and population growth. The city’s earnings tax means that city residents and workers lose an additional 1 percent of their income to taxes. Numerous special-taxing districts make sales taxes as high as 11.679 percent in some areas of the city. Stringent business regulations make it harder for businesses to operate and hire workers. Does this sound like an attractive place to live, work, or start your business?

Our city continues to make headlines for losing population. If we want to stop this trend and attract residents and businesses to St. Louis, action is needed. Addressing the crime rate and poor schools will be challenging, but other cities such as Indianapolis (with a strong school choice environment, some crime rates trending down, and a growing population) have done so. With respect to taxes and regulatory policy, repeal the earnings tax, cut red tape, and rein in special-taxing districts. With a focused effort on doing the basics well and getting government out of the way of business, St. Louis City might start to grow again.

The post St. Louis Is Shrinking. Let’s Reverse the Trend appeared first on Show-Me Institute.

According to the new estimates, the city of St. Louis is getting close to dropping below 300,000 residents. The city’s 2019 population estimate is 300,576, down by over 2,800 from 2018. This isn’t a new occurrence, but rather a continuing trend—the city’s population has fallen by nearly 6% since 2010, shown in the graph below.  St. Louis County also lost population, dropping by 1,014 from 2018 to 2019.

Other areas of Missouri are not experiencing this same trend. Right outside of the St. Louis area, St. Charles passed the 400,000 mark, adding 3,242 people in 2019. Many other areas also experienced growth, including Clay, Greene, and Jackson counties.

Though we can’t know for certain why people are moving out of St. Louis, Show-Me Institute researchers have written on population trends before, and much of what has been said still holds true. Policies that promote success and freedom for people and businesses can attract residents while those that place onerous burdens can deter.

Things like an earnings tax on residents and workers, high sales taxes, and stringent business regulations can create an unwelcoming environment. Additionally, poor school performance, high crime rates, and failed public projects can make St. Louis an unattractive option.  If we want to reverse the trend, policymakers will need to address these issues. The sooner, the better.

The post Census Estimates Show St. Louis Population Falling . . . Again appeared first on Show-Me Institute.

But while population loss in roughly half of Missouri’s counties sounds terrible, there’s more going on here.

A great deal has been written about the growth of big cities across the country, but news outlets are slowly picking up on a trend that shows small and middle-sized cities gaining steam with young people. Think cities like Waco, TX and Knoxville, TN as opposed to Austin, TX and Nashville, TN—cities that aren’t necessarily state population hubs but that play an important role in their regional economies.

In fact, it seems that young people’s attraction to big cities is often overstated. Research increasingly suggests they are equally drawn to the less-costly option of smaller cities and suburban areas. Census Bureau data show that suburban growth is outpacing large city growth, with large city growth tapering off.

How is this playing out in Missouri? While most rural counties and Saint Louis City saw population declines, many medium-sized cities—Springfield, Columbia, and Lee’s Summit to name a few—have seen population increases according to the Census Bureau. Since Missouri’s total population only grew by a small percent, most of this population change is attributed to intrastate migration.

So while it is true that rural populations are dipping, it’s at least in part because of regional population consolidation in cities not far from where residents formerly lived.

And when you think about it, this migration trend makes a lot of sense. Small and medium-sized cities provide many employment, entrepreneurial, and social opportunities that may not always be available in rural areas, and these cities are often more affordable and community centered than big cities. While this trend isn’t great for rural counties—that is, the political subdivisions themselves—it is good for the people moving toward better economic and social prospects. As farms in rural areas become more productive and require fewer laborers, having access to city resources and opportunities will be all the more important for these residents.

Unfortunately, Missouri has struggled with overall population growth in recent years. During that same July 2017 to July 2018 time period mentioned above, Missouri was 29^th in the nation in population growth, with a paltry 0.3% increase. This rate is consistent with the low population growth rates that we’ve seen for years. So, while this trend of intrastate migration is positive, we can’t forget that Missouri still struggles to attract new residents.

The post Many Missourians Are Moving . . . To Missouri appeared first on Show-Me Institute.

But while the metropolitan area did see a net increase in population, the news in context isn't all that great. (Emphasis mine)

St. Louis, which held steady at about 2.81 million people, is now the 20th-largest region in the U.S., having been leapfrogged by the surging Denver metro area, which gained an estimated 58,000 residents just last year.

The St. Louis region has added an estimated 24,000 people since 2010. Among the 25 largest metro areas, only Detroit has added fewer people. More people have left the region than moved in during the past five years, but the population was pushed upward because of births.

We have written at length about the importance of strong cities to our local economies. When a region's economic anchor begins to sink, the rest of the region suffers as well, and that's where things stand in St. Louis. From taxes to incentives to education and everything in between, the ship of state that is St. Louis City is running ashore. Rather than stay the course, it's time for a course correction. It's time, finally, for reforms.

The post Census Report: St. Louis City Continues to Shrink appeared first on Show-Me Institute.

In 1950 Saint Louis was the eighth largest city in the United States with a population of 856,796. According to the 2014 Census estimate, Saint Louis has two-thirds fewer people than in 1950.

Such a dramatic decrease in population has major effects on local government. As the population declines, taxable income and sales leave the area and revenue declines with it. Lower population levels exacerbate other issues such as abandoned buildings, lower property values, and, as a result, fewer funds for public schools.

Saint Louis is a city that has much to offer. So why are people continuing to leave? What should the city do to halt the deflating population?

The post The Incredible Shrinking City appeared first on Show-Me Institute.

Why the marked differences in population growth between Missouri’s two major cities and their surrounding areas? Undoubtedly, there are a number of factors involved, like housing prices, amenities, and school quality. But what about taxes? Specifically, what about the 1 percent earnings tax that both cities impose on everyone who works there and on everyone who lives there even if they work someplace else? A new study by Howard Wall, commissioned by the Show-Me Institute, suggests that the earnings tax could be impeding the population growth of both cities.

In 1947 the Missouri Legislature authorized cities with populations of 70,000 or more to levy an earnings tax, capped at 1 percent. Only Saint Louis and Kansas City chose to impose this tax. But earnings taxes are known to have bad economic side effects. A study by Dr. Joseph Haslag of the University of Missouri–Columbia found that Saint Louis and Kansas City’s earnings taxes help explain the decline in personal income in those cities relative to the surrounding non-taxed metro areas during the first part of the 2000s. Wall, the director of the Hammond Institute for Free Enterprise and the Center for Economics and the Environment at Lindenwood University, tackles a different question: Does the imposition of earnings taxes help explain differences in population growth across cities?

Wall conducted his investigation using population growth rates for 185 cities (population 25,000 or more) over the period 2000 through 2010. Seventy-nine of the cities included in his study levy an earnings tax. Nineteen Missouri cities are included, of which only Saint Louis and Kansas City have an earnings tax.

After controlling for other factors that might explain differences in population growth, Wall finds that having an earnings tax has a statistically significant, negative effect on population growth. And the impact is not small: A 1 percentage-point increase in the earnings tax is associated with about a 4 percentage-point reduction in population growth over a decade.

What does that mean for Saint Louis and Kansas City? Based on his results, Wall suggests that the earnings tax in Saint Louis accounts for about half of the population decline experienced over the decade. For Kansas City, the earnings tax may have cut its population growth in half.

The effects of the earnings tax apparently do not stop at city borders. Wall finds that there are negative metro-wide effects emanating from the central city’s earnings tax. The population loss of Saint Louis City dwarfs the population increase in its ring cities, yielding a net reduction in the metropolitan population. The effect is similar for Kansas City. There are substantially fewer residents living in the metro area than there would have been were it not for Kansas City’s earnings tax. Employing an earnings tax has adverse effects on population growth for the taxing city that spill over into surrounding communities.

Even though the earnings tax produces such negative effects, how would cities replace the lost revenue if they were removed? One option is to reorder tax priorities. Wall notes that, on average, property taxes account for about 17 times as much in revenue as income taxes in cities across the country. In sharp contrast, Saint Louis and Kansas City rely more heavily on taxing income. In Saint Louis, the earnings tax revenue is more than twice that from property taxes; in Kansas City it is a little over 1.5 times as big.

The evidence in Wall’s study and in previous research lends credence to the view that shifting priorities from taxing income to taxing property may be the answer to reversing the negative economic effects of the earnings tax on Missouri’s major cities.

R. W. Hafer is the distinguished research professor of economics and finance at Southern Illinois University Edwardsville and a research fellow at the Show-Me Institute.

The post Taxing a Population: Saint Louis and Kansas City’s Earnings Tax Draw People Away appeared first on Show-Me Institute.

The impact of earnings taxes has been studied before, in multiple ways. In 2006, University of Missouri–Columbia economist Joseph Haslag compared 101 cities, 24 of which had an earnings tax. In his analysis, Haslag found support for the idea that a city earnings tax encourages businesses and people to locate outside the city, in the suburbs or the county. In 2010, two Saint Louis University economics professors, Lisa Gladson and Jack Strauss, studied 179 metro areas and examined the effect of an earnings tax on growth between 1969 and 2007. They determined that an earnings tax did not affect overall metro area growth, although it should be noted that this result is not contrary to Haslag’s study, which looked at the distribution of income within a metro area rather than at overall regional growth.

Wall’s essay, “New Evidence on the Effects of City Earnings Taxes on Growth,” builds on these two prior studies. He focuses, however, on population and payroll employment rather than on income — a novel approach that can shed light on another important question about the impact of earnings taxes. Wall wants to know whether an earnings tax affects how many people move in or out of a city, and whether that tax affects employment.

Wall compared more than 1,000 cities with populations higher than 25,000, controlling for a number of important factors. He found that an earnings tax does indeed have a significant negative impact on population growth, as well as on employment growth. For every percentage-point increase in an earnings tax, the population growth rate is reduced by an average 3.04 percentage points, and the employment growth rate drops by 2.32 percentage points. As Wall points out, this means that, in the absence of an earnings tax, the population in Saint Louis city could have contracted by only 10 percent between 1990 and 2000, instead of by 13 percent — retaining almost 14,000 additional residents. Given the recent bad news about the continuing population contraction in Saint Louis city during the last 10 years, this is a great time for residents and lawmakers to sit up and take notice at what may be a significant contributing factor to the decline.

The essay also shows that the 1-percent earnings tax in Saint Louis and Kansas City is associated with 1.65 additional percentage points of population growth — not for the cities themselves, but for their surrounding suburbs. This bolsters Haslag’s 2006 finding, and further demonstrates an important point: The unintended consequences of an earnings tax tend to be felt in the long term. Businesses and individuals won’t necessarily haul up and move right when a 1-percent earnings tax is first implemented. Over time, however, the influence of such a tax makes new businesses marginally more likely to locate outside the city, and has a subtle influence on where people choose to live when they find themselves making such a choice.

Wall’s findings contain important insights that should be heeded by earnings tax supporters. As he points out in his conclusion, many cities successfully make do without an earnings tax. The long-term picture is brighter for such cities, given that they face fewer negative effects of diminished population and employment growth. It is time for public officials in Saint Louis and Kansas City to explore ways of replacing the earnings tax, if they wish to enjoy the associated benefits of increased growth rates in population and employment.

Josh Smith is a research assistant at the Show-Me Institute, an independent think tank promoting free-market solutions for Missouri public policy.

The post New Evidence Demonstrates How Earnings Taxes Harm City Growth appeared first on Show-Me Institute.