Population decline not an economic `opportunity'

In a recent commentary, IJ political columnist Dick Spotswood suggests that San Francisco's decline in population because of out-migration is an “opportunity” for, among other things, lower rents occurring through supply and demand dynamics (“Shrinking population is an opportunity for cities like San Francisco,” July 19).

While the economic principles of supply and demand, or more appropriately “scarcity,” are frequently invoked when discussing housing in the Bay Area, a more important economic principle is often ignored; that of “economic growth.” Economic growth is critical to regional economies (like here in Marin) to provide incomes, jobs and public services. However, there are only two ways economic growth can occur: through productivity gains or by population increase.

Productivity gains are hard to realize in locally oriented service businesses such as restaurants, auto repair and retail, which make up the majority of Marin-based businesses. That means, for regions like Marin (and San Francisco), a population decline (or even a reduction in labor force through retirement or otherwise) jeopardizes economic growth and its corresponding revenues for public services.

Academics have written about the risks of a future with fewer people for years. But do not take my word for it, just ask any local business how much missed revenue opportunity occurs because they cannot hire more workers. Population decline is an economic risk to a region, not an opportunity.

— Mike Blakeley, San Anselmo