Study: Retirees’ economic clout worth pursuing

Georgia’s already a draw for retirees, but a new UGA study suggests the state and many counties should do more to attract them.

They have money and they’re willing to spend it, the study says, and that translates to jobs and economic development.

With the number of healthy and wealthy Baby Boomers expected to soar over the next decade and a half, retirees represent a low-effort chance to grow. Retirees are more likely to relocate now, thanks to an improved housing market which may allow them to sell their homes and move on to their dream destination. That could be Georgia.

“This is an opportunity,” said Jeff Humphreys, a UGA economist who authored “Golden Rules,” an evaluation of retiree-based economic development in the state. The report drew on U.S. Census data.

It takes only 1.8 in-migrating retirees to generate one job, the study found. The annual economic impact in Georgia of a typical year’s inflow of 15,805 retirees is $941 million and 8,574 jobs.

“The bottom line is the aging population is here to say and they bring a lot of assets, one of which is their spending power,” said Charima Young, associate state director for community outreach at the AARP in Georgia.

Pia Thompson stayed busy after she retired two years ago and moved to Alpharetta from Florida to be near her daughter. She’s been stimulating the economy here ever since.

Buying power

She buys golf equipment, books, groceries and gas, and pays taxes and utilities.

“I spend money,” the 62-year-old said. “I’m contributing.”

The Georgia Department of Economic Development doesn’t have anyone actively trying to recruit retirees, spokeswoman Stefanie Paupeck said.

“Our charge here at the department is to attract jobs and investment opportunities to Georgia,” she said. “While attracting retirees is a positive for the state it is more of a statewide policy issue.”

Baby Boomers are targeted through the tourism division, she said.

Retiree-based economic development is not without risks. Their wealth and spending power can be reduced by extended periods of high inflation or by low returns on investments. There also is the possibility of negative changes to Social Security or Medicare.

Then there are concerns that retirees drain local economies because they require services such as recreation. The UGA study said they are a net gain for communities, and Thompson agrees.

“There are so many myths about retirees,” she said. “That they’re taxing their communities. We’re not. We bring a lot to the table.”

Retirees can offer economic stability to a community since they are out of the iffy job market, and they cause the creation of jobs that are necessary to provide them services and sell them products.

Moving again

Like other age groups, retirees are more likely to move now.

“The primary roadblock to mobility has been the housing market,” Humphreys said. Now, “There is some pent-up demand that has accumulated. This is the time to prepare and get ready for it.”

All mobility rates were depressed in downturn, but they’re up again, said Harmon Smith, executive vice president of field operations for PulteGroup, Inc., which has three active adult communities in metro Atlanta under its Del Webb brand.

At the same time, the number of retirees is rising and that trend is expected to continue. Georgia is in good position to attract some of them.

The state has some natural advantages to lure retirees including a sea coast, mountains and plenty of rural areas as well as cities. Its tax structure helps. Georgia offers a retirement income exclusion, sales tax exemptions for food, drugs, and medical services, and has no estate or inheritance tax.

Georgia has about 1 million retirees, about 10.6 percent of the state population. That is lower than the retiree share of the U.S. population — 13.1 percent. But projections are that the number of Georgians age 60 and over will hit 2.5 million in 2030, and the number who are 65 and over then will total 2 million.

Retiree populations especially help industries such as health care, home building, retailing and household services.

Some communities are working to attract them.

Stephanie Scearce, executive director of the Fannin County Development Authority, said that mountain community, which attracts many retirees, seeks them out with its tourist marketing. Many people visit the area then buy second homes and eventually retire there, she said.

The county is preparing for longer term needs to serve an aging population.A senior living facility is being built and there is a proposal for an assisted living development.

“There’s recognition this will be an aging population,” Scearce said.

Medical issues

Another concern for more rural areas with growing retiree populations is adequate medical facilities. Fannin Chamber of Commerce president Jan Hackett said the local medical community had grown considerably in the last decade to accommodate increased demand. She said more quality health care is vital as the county attracts more retirees.

Economically, the area isn’t prime for industrial development, Hackett noted, and retirees offer an alternative way to drive development.

The UGA study calls retiree-based economic development “a good way to grow and diversify Georgia’s rural economy.” It recommends going after “amenity-seeking retirees” who like many of the same things as tourists. Joint marketing to tourists and retirees makes sense, with an emphasis on people aged 55 to 64 many of whom are still deciding where to retire.

State-to-state migration data for 2007-2011 shows Georgia attracted 15,805 retirees per 12-months on average from 2007-2011 versus 8,506 who moved out.

In a typical 12-month period, about 31,000 retirees moved to or within Georgia. About half went from one Georgia county to another.

By far, the biggest number of retirees who came to Georgia from another state moved from Florida, followed by New York and Alabama. The top states where Georgia retirees moved to were Florida, then Alabama and North Carolina.

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