Expert Phil Burgess on population surge in Western U.S.

By Jim Christie

"Head West, young man," the saying goes. Many are; the Western U.S. continues to grow, and that's not about to turn around, says at least one expert. Why? Western states are poised to assume a leading role in the New Economy, says Philip Burgess, president of the Denver-based Center for the New West, a regional think tank.

Migrants are flocking to the West. That brings promise--and problems. IBD discussed both, and why they're worth tracking, with Burgess.

IBD: Why are Western states will drawing newcomers?

Burgess: First, Western states are increasingly important immigrant gateways.

Second, the economic center of gravity of the nation in 1983 started shifting from the Atlantic to the Pacific. In part it was because of the rapid growth in Asian markets. Also, there's been tremendous growth in high-tech (industry) clusters throughout the West for computers, software and biotechnology.

Third, we're seeing a lot of retirees. They're more upscale and bring a lot of capital and skills that often get put into second careers.

IBD: What about younger migrants?

Burgess: A second major group of migrants is what we call "Lone Eagles," New Economy nomads who use telecommunications technology to live where they want to live.

We were the first to identify them back in 1991, but only through anicdotes. Now evidence is pouring in that it's really happening in large numbers.

Lone Eagles account for many high-performance migrants in the 24-to-55 age group. Many of them hire people, and perhaps every 10th or 12th opens up a small company.

IBD: Which Western states are the most popular destinations?

Burgess: The rankings change year to year, but it's all the Southwestern states. These are places where a lot of New Economy companies are developing.

IBD: Why start them there?

Burgess: In every one of these states you have very high levels of education, higher than the national average, and you have good weather. The natural amenities are very attractive for knowledge workers.

These also are places where you have good telecommunications infrastructure. The two things that mess up satellite technology are lots of trees and lots of rain. Outside of the Pacific Northwest, you essentially have desert conditions.

IBD: How are the economics of these states changing?

Burgess: There has been a tremendous amount of economic diversification. A lot of them were dependent on one or two industries and government. Now they're moving from cows, coal, mines and mills to technology, entertainment and financial services.

IBD: Isn't California driving much of the change throughout the West?

Burgess: What you see (out West) is a huge spillover from California. For instance, California is still the 800-pound gorilla in biotechnology, but we've found 75 biotech firms in Oregon, 115 in Washington, 200 in Utah, 337 in Colorado, 80 in Arizona, and New Mexico is the hub for the human genome project.

IBD: How much have these states grown in the past few years?

Burgess: Just in terms of population, Western states have included seven or eight of the top-10 fastest-growing states during the last decade.

The U.S. average for population growth from 1996 to the present has been about 0.9%. In Nevada, you've had 4.7%; Utah, 2.1%; Arizona, 2.7%; Colorado, 2%; Idaho, 1.9%; Washington, 1.6%; Oregon, 1.5%.

IBD: Isn't there a strong sense of NIMBYism (not in my backyard) in these states?

Burgess: Much of the growth is driven by amenity-seeking migrants. So there's a very strong feeling among these already there that newcomers will foul the nest.

IBD: How's that influencing discussions over growth?

Burgess: In urban areas it takes the form of anti-sprawl and growth-management movement. That's pushing people out of cities and into rural areas. Now you've got a High Occupancy Vehicle lane between Carbondale, Colo., and Aspen through the Roaring Fork Valley.

All over the rural West you can find traffic jams, like in Durango, Colo., Bend, Ore., Jackson Hold, Wyo., and between Ketchem and Sun Valley, Idaho.

IBD: How will the economy of the West do in the near term?

Burgess: We're only at the beginning of a global economic boom led by New Economy industries that are rooted in the Western U.S. The West will be a growth leader for the U..S. and for the rest of the world.

The West provides a window to both the Asia-Pacific region and Latin America. All 37 border crossings between Mexico and the U.S. are in the West, and the growth in that border region has been about 10% a year since the start of the North American Free Trade Agreement.