How does population growth boost Boulder in the economy？

Boulder County in Colorado is a thriving city that sits at the foothills of the Rocky Mountains. It’s famous for its good climate, fast economy growing, and safe neighborhood and it has attracted thousands of people to settle there. So, we may wonder what happens after the population keeps increasing in this county? How does it affect the lives of local people? In this article, we are trying to explore some of these questions from the real data.

One of the most prominent features of Boulder, Colorado, is its growing population. The Boulder County has been a popular place to live for many years, and its population has steadily grown over time. From 2001 to 2021, the population of Boulder increased from 278,981 to 329,543, an 18.2% increase based on the data from the following table. This growth may have been driven by various factors; one reason could be the strong economy. As the GDP increased, so did job opportunities, attracting more people to the area. Additionally, the high quality of life in Boulder, with its beautiful surroundings, cultural attractions, and outdoor recreation opportunities, may have also contributed to the growth in population. However, we can clearly see a drop in the population in the year 2010 and maybe there’s a challenger in a neighboring county that has more job opportunities and attract the population there. It’s also important to note that the population growth rate has slowed down in recent years, with an increase of only 1.3% between 2019 and 2020. This could be due to various constraints, such as housing affordability and availability, job market fluctuation, or natural population growth limitations.

In addition to population growth, Boulder has seen significant increases in its GDP. The following plot shows a steady increase in GDP over the past two decades, with a few dips during economic downturns. The GDP of Boulder increased from 18,076.532 million in 2001 to 29,154.660 million in 2021 with a total of 61.3% increase. As we have already known from the previous plot that the population keeps increasing during the same period of time, it is easy to see that the GDP will grow as well, as there’ll be more labors in the market to manufacture more products. This will also indicate that as the population of Boulder increases, the demand for more goods and good services increases too, resulting in a higher GDP in this county. We can also see from the plot that there are a few dips in the GDP growth in Boulder. In 2010 it decreased a little and this one is in line with the population decreasing trend during the same time; however, the second one that happened in 2020 could be related to competition from neighboring cities, changes in government policies, and due to the pandemic that spread around the whole country.

After showing these 2 plots for population and economy, I did a correlation analysis and draw a scatter plot for their relationships. The correlation value for these two indicators is 0.96, meaning there’s a strong correlation between them and it matches our previous guesses. The scatter plot also demonstrates the relationship clearly as shown below. One possible explanation for the strong relationship is that the increased economic activity in the city creates more job positions, attracting more people to the county. As the city population grows, businesses and investors are more likely to invest in the area, thus creating even more jobs opportunities and fueling further economic growth. This positive feedback loop can continue, leading to a sustained increase in population and economic boost.

As for the house price index of Boulder, Colorado, the following plot has shown a consistent increase over the past two decades, from 162.97 to 358.21 during the past 2 decades. This growth has been driven by various factors, including the city’s attractive quality of life, job market, and educational opportunities, which have led to increased demand for housing and driving up the prices of homes in the area. This may have also contributed to the growth of the economy and attracts the investors to invest money in the county’s housing market. However, it’s important to note that the house price growth rate has slowed down from the year 2010 to the year 2013. This could be due to various factors, such as housing affordability and availability for common people, government regulations to cool down the market, or interest rate increases that hold back the investors.

Let’s analyze the relationship between GDP and the housing price index based on correlation analysis. The correlation between these two is also 0.96, thus we believe that there’s a strong correlation between GDP and the housing price index. We can also see the strong positive relationship in the following scatter plot too. This relationship is not surprising, as a growing economy can create more jobs, leading to higher income levels. Moreover, as the economy grows, the demand for housing increases too, which can lead to an increasing in the house prices. However, it is important to note that while higher house prices may be good news for people that already own houses, it can be challenging for those who are looking to buy a new home, especially if it is their first house. It’s also important to balance this growth with sustainable development and planning to avoid overburdening the city’s resources and infrastructure and some speculative buying activities. For example, if the housing price is going too fast because of the investors, certain actions need to be taken to slow it down. Otherwise, people will leave and result in the slowing down of the economy.

The Boulder County ranks relatively high in terms of resident income. As we can see from the following table of the top 10 medium income among all 64 counties and histogram distribution, the Boulder County sits in the 6th place among all the counties in Colorado. Overall, Boulder County appears to be a high-income area in Colorado, with a solid income level compared to other counties in the state.

As for the plot of income data for Boulder, it shows a steady increase in income over the years, with some fluctuations during economic downturns. From 2001 to 2021, the median income increased from 42,239 dollars to 89,593 dollars with a 112.1% increase. This may be because that the strong economy has created more job opportunities and higher-paying jobs, resulting in a higher paycheck for the residents. Also, as the GDP of Boulder increases, some new jobs may require a higher level of knowledge, like management and company need to recruit people with more experience, insulting in higher income. Additionally, as the housing prices increase as we know from the previous plot, property values and rents rise, which increases the cost of living in the area, resulting in higher wages. As we can also see that there’re dips in income growth in Boulder and it could be related to competition from neighboring cities, changes in government policies, and economic downturns that the whole market requires less labors and companies are less willing to pay more money for people with experience to expand their business.

Based on the analysis, there’s a strong positive correlation between the house price index and the city’s GDP with the correlation value of 0.98. As the GDP grows, so does the income of Boulder residents, indicating that the economic growth has translated into real benefits for the community. This is further supported by the upward trend in the house price index, which is another indicator of the overall health and prosperity of the local economy. It is important to note that while there’s a strong positive correlation between income and GDP is evident, it does not necessarily mean that everyone in the area is benefiting equally from the economic growth. What if the income has not been a growing equally among residents in Boulder, with the highest number of people making significantly more than the average household? Or if the housing price is growing faster than the increasing rate of the income for most residents, this could also become an issue. So as a result, this highlights the need for government policies and rules to aim at ensuring that the benefits of economic growth are distributed more equitably.

In conclusion, the Boulder County has seen impressive economic growth over the past two decades, with strong positive relationships between GDP and its population, resident income, and housing price index. While this growth is encouraging, it is important to address the challenges that come with rapid economic expansion. Policymakers must work to ensure that the benefits of economic growth are shared more evenly and that all residents have the same opportunity to live and work in the neighborhood. Overall, the data suggest a positive outlook for the future of Boulder with steady growth in each area if the challenges are carefully monitored and managed.

For the reference part, I’ll list the data source for each of the data sheets that I used:

Boulder_popu, source link: https://fred.stlouisfed.org/series/BOLPOP

Boulder_GDP, source link: https://fred.stlouisfed.org/series/RGMP14500

Boulder_house_price, source link: https://fred.stlouisfed.org/series/ATNHPIUS14500Q

Boulder_income, source link: https://fred.stlouisfed.org/series/BOUL508PCPI