Four reasons why demographics matter

June 2, 2023 By 0 Comments

Four Reasons Why Demographics Matter

Much of what we do every day—from where we live, to what we buy at the store, to how we vote in local and national elections—is shaped by demographic data. Yet most people are unaware of how much influence demographics have in their daily lives.

Demographics are the traits and socioeconomic factors that make up a particular population. Some examples are age, sex, ethnicity, marital status, education level, income, employment status, homeownership, or language spoken. Demographics can also include information such as birth rates, death rates, marriage rates.

What Can You Learn by Looking at Demographics?

Though demographic data may seem like a collection of facts and figures, it actually goes much deeper than that. Demographic data is socioeconomic information that shows you characteristics of a particular geographic group at a particular time. Some types of demographic data and groups include the genders that work in a specific profession, the ages that earn a certain income, and education level by income and geographic location. Examining this type of data allows you to identify commonalities between different groups and subgroups.

An important factor of demographic data is that it represents more than just a snapshot in time, and can show how a group is changing over time. This information allows you to use it to make predictions about how groups will change in the future. 

For example, demographics can reveal population changes in a particular area. From 2010 to 2021, the city of Seattle, WA grew by 17.8% from a population of 608,660 to 736,912.  During that same time, the city of Baltimore, MD shrank by 6.1%, going from 620,961 people to 582,972. Demographics can also show how the change in size is related to certain factors, such as birth and death rates. Almost 75% of counties in the United States reported in 2021 that they had more deaths than births that year, leading to a net population decrease in those areas and a slowdown in overall U.S. population growth. During the decade from 2010 to 2020, the fastest growing city in the U.S. was Williston, ND, where the population grew by almost 83%. The second-fastest growing city during that same decade was The Villages, FL, which grew by almost 39%.

Demographics can show additional data such as the ethnic diversity of an area, poverty rates for different ages, and whether the poverty rates are going up or down for those age ranges. The data can tell you about the population’s marital status, profession, employment status, languages spoken, spending habits, and much more.

Why Demographics Matter

Demographics can affect your home, neighborhood, government, and even the products you buy. With the right data, you can look at a collection of people and understand more about them and their backgrounds. Demographic data can help identify the wants and needs of a particular group. For instance, in 2022, Madison, WI had a total population of 269,940. They had a median age of 31.6 years old, with 33,340 residents 65 and older, for a total of 12.3% of the population. Compare this to Sebring, FL, where the 2022 population was 11,169 and a median age of 44.4. Sebring seniors made up 27% of the population, with 3,126 people aged 65 and older. The residents of Madison will probably be interested in different restaurants and recreation opportunities than the population of Sebring.

Organizations study demographics and follow them over time to gain a broad understanding of a population. Demographic data can provide a view of what is “normal” or “expected” for a particular area or group based on past actions or behavior, as well as show how that population is changing or evolving. An area that changes in makeup from having a majority of single income households to having a majority of two income households will have different needs and desires.

It’s not just businesses that benefit from having demographic information. Knowing the demographic data can help researchers, policy makers, and governments make decisions for that population. Governments at the local, state, and national level use demographic data for planning, and their decisions can have a profound, long-term effect on our lives at all levels. Local governments determine the number of schools in a city based on age of population and whether that population is growing or shrinking, while on a national level, population data determines how many members each state has in the U.S. House of Representatives.  

The four main reasons why demographics matter are:

  1. Economics

    – economists use demographic data for analysis and forecasts. Demographics are a key factor in determining the potential of growth in the housing and labor sectors, for determining the demand for financial assets, and forecasting the future of the labor market.

  2. Governments

    – all levels of government use demographic data to determine policies. Population determines the size of congressional delegations, and determines electoral college allocations by state. Local governments use population demographics such as the age and birth rate in a community to allocate funds for public services such as schools, hospitals, and transportation.

  3. Politics

    – the makeup of a region guides how politicians use their resources to campaign and represent an area, while socioeconomic factors can also help forecast which candidates are more likely to win voters in different areas. 

  4. Businesses

    – public demographic data and market research helps businesses formulate strategies. This data can help identify key customers, influence planning marketing strategies and segmentation, drive new product development, and be used for future planning and growth.

How to Get Demographic Data

The demographic data you need for research, planning and business goals is available in an easy-to-access, publication-ready format. EASI Demographics uses our own methods and modeling to create high quality estimates and data elements, incorporating aggregated demographic data from the best-of-breed resources using the most up-to-date records available, including:

  • U.S. Census
  • American Community Survey
  • Bureau of Labor Statistics
  • Bureau of Economic Analysis
  • National Health Interview Survey
  • ZIP-4 postal codes
  • and numerous others

Our products contain datasets for all U.S. geographies with:

  • Block groups
  • Census tracts
  • Zip codes
  • Cities
  • CBSAs
  • Counties
  • States
  • The United States

Datasets are updated annually for better insights into understanding communities in your target region. Databases can be accessed through our subscription site or conveniently delivered on-demand to your inbox for your unique use. Choose the communities or geographies you desire, with thousands of different variables to choose from on a local, regional, or national level.

Ready to learn more? Contact an account specialist today to see how we can help you with the demographic data you need for your business.