Kentucky Population Growth Rate Trends
I have undertaken the task of analyzing Kentucky’s top ten Cities. As I stated in my previous blog post, one of the three most important demographic characteristics to consider when evaluating an investment decision is the growth of the local population. Providing you with a picture of the population growth of the top ten cities in Kentucky required me to consider them in two groups of five – a graph of the top ten together would simply be too cluttered. In this case, what really matters is the rate of growth and not simply the raw figures. When faced with an investment decision, you really want to know how fast one city is growing relative to the others. Thus, the chart below depicts the rate of change for the population in the top five most populous cities in Kentucky from 2000 through 2010, expressed as a percentage.
The chart above ranks the top five most populous cities in Kentucky by population growth. In order, these are Bowling Green, Lexington, Louisville, Owensboro, and Covington. The compound annual growth rates are: Bowling Green (1.64%); Lexington (1.24%); Louisville (.74%); Owensboro (.51%); and Covington (-.51%). Care must be exercised in interpreting the trend line I included in the chart. Notice that the City of Covington appears below the horizontal axis, indicating that the city actually declined in population. The upward sloping trend line simply indicates that from 2000 through 2010 Covington lost population at a declining rate.
The chart below ranks the bottom five of the top ten cities in Kentucky by population growth. As with the chart above, care must be taken in interpreting the chart, particularly the trend line. All cities above the horizontal line experienced positive population growth. The trend line denotes whether the change in population growth is increasing or decreasing over time.
The chart above indicates that each of the five cities in the bottom half of the top ten most populous cities experienced positive population growth from 2000 through 2010. In order, these are: Georgetown, Elizabethtown, Florence, Richmond and Hopkinsville. Their annual compound growth rates are: Georgetown (4.68%); Elizabethtown (2.51%); Florence (2.36%); Richmond (1.32%); and Hopkinsville (.43%). Notice the erratic population changes in Hopkinsville? Without further research, I’m guessing the erratic growth has to do with troop movements associated with the nearby Ft. Campbell (as a side note, I used to be stationed there). In terms of risk analysis, these troop movements are especially important when evaluating investments in areas whose local economies are heavily reliant on the military. Ask anyone in Radcliff, Kentucky, how troop movements affected them in the early 2000’s. A word to the wise…
Of the bottom five cities in the top ten, two have upward sloping trend lines, three have downward sloping trend lines. While the trend in the change in growth rate for Elizabethtown and Hopkinsville is increasing, trends for the remaining three cities are declining.
Ranking the top ten cities according to their compound annual growth rate, a summary of my analysis is provided in the chart below. Areas that are shaded green are considered to be positive, areas shaded red are negative.