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REPORT SEES DECLINE IN JOBS, POPULATION HERE

Population losses that plague Buffalo and other upstate areas are part of a decades-long trend that is unlikely to change soon -- a gloomy outlook that communities need to grapple with, according to a Federal Reserve economist.

"The jobs are moving to where the people are going . . . it's not clear what policy can do to address this," said Richard Deitz, regional economist at the Buffalo Branch of the Federal Reserve Bank of New York.

Net population loss or "out-migration" held upstate New York's population growth to just 2 percent from 1970 to 2000, while the U.S. grew 38 percent.

The twin forces of declining jobs and declining population are reinforcing each other, as growth shifts to other regions of the country, Deitz said in a paper published Tuesday based on U.S. Census figures.

From 1980 to 2002, the Buffalo-Niagara Falls metropolitan area saw out-migration of 12.1 percent, leaving its population 6.5 percent smaller, one of the worst performances among upstate cities. Albany, Rochester, Syracuse and Glens Falls metro areas were able to grow their population despite the trends.

But even in the first half of the century -- the good times for Buffalo's economy -- upstate's population grew markedly slower than the nation as a whole, the study said. The shift of growth to the West and South left upstate behind, along with much of the Northeast.

Out-migration has left upstate with fewer working-age people to fill jobs and support tax rolls, the paper said. From 1980 to 2000, upstate lost 21 percent of young people ages 20 to 34, according to the study. The trends have left the region with 14.1 percent of its population over 65, compared to 12.4 percent nationally.

"The aging of the population is just beginning," Deitz said. "We need to be more pro-active in dealing with it."

The trends are at least partly to blame for fiscal problems, like the rising costs of Medicaid, that are roiling voters, he said.

"It's unlikely these are problems we'll be able to grow out of."

The upstate area in the study embraces 49 counties, leaving out New York City, Long Island and six suburban counties downstate.

The report doesn't single out New York's tax structure, which some economists blame for the exodus of manufacturing jobs and subsequent drop in population. While businesses moved in search of lower costs, people moved for amenities like warm winters, the paper said.

In a 1999 study, state economist Stephen Kagann argued that New York's rising tax burdens correlated with the the loss of jobs in recent years. Every $1 billion in additional taxes by state and local governments cost 45,000 private sector jobs, he found. In periods where the tax burden lifted, upstate's job performance was as good or better than other manufacturing-heavy states.

Gary Keith, regional economist at M&T Bank, said upstate and its cities can fight population loss by creating economic opportunities. "There are some things we can do about it," he said, such as reducing business costs and strengthening ties between colleges and local companies. The region's quality of life can attract people, if job openings exist.

e-mail: fwilliams@buffnews.com