U.S. minorities increasingly in the majority

Last Updated Jun 25, 2015 3:19 PM EDT

The face of America is changing.

The baby boomers, once the country's largest generation, can no longer hold claim to the title. The so-called millennial generation, or those Americans born between 1982 and 2000, is now the country's biggest segment of the population, with 83.1 million members, compared with 75.4 million for the boomers, according to a new U.S. Census report.

It's not only the numbers that are shifting, but also the country's diversity. Millennials, who represent more than one-quarter of the U.S. population, are more racially diverse than the nation's older generations, Census data shows. About 44 percent are part of a minority race or ethnic group, compared with only about 22 percent for Americans over the age of 65.

Still, there's another generation that's giving the millennials a run on the claim of being America's most diverse group. The country's youngest citizens, those younger than 5 years old, are the first group in U.S. history to represent a "majority-minority," which means more of them are minorities than whites. About 50.2 percent of Americans younger than 5 are minorities, the Census said.

That's having a long-term impact on America's racial and generational composition. A decade ago, minorities represented about 33 percent of the country. That's shifted to almost 38 percent in 2014.

Several trends are driving the changes, such as immigration from China and Mexico, along with an increase in multiracial families.

"Mexico has been the largest sending country of immigrants for quite some time, but China has taken over as the top sending country," said Ben Bolender, chief of the Census' Population Estimates Branch. The country's entire population is expected to tip into "majority-minority" in 2044, he said.

Asked whether the term "minority" will need to be dropped when that happens, Bolender said, "It's difficult to formulate race definitions that people can identify accurately in." That's why the Census is considering changing how it asks about race in 2020, he noted. "The definitions are constantly changing, so we'll have to wait and see what terminology is most appropriate."

In 2020, the Census may ask people to check off what "categories" best describe themselves, rather than race. It might also add new racial categories, such as one for people of Middle Eastern or North African heritage.

The share of multiracial babies has surged, rising from 1 percent in 1970 to 10 percent in 2013, according to a Pew Research Center study published earlier this month. Taboos against interracial marriage and relationships have faded, and demographers believe there will be more multiracial children born in future decades.

These social shifts are also having other effects. That includes how businesses market their products, with many companies eager to attract millennials, given the group's size. Whole Foods (WFM), just to cite one example, is opening a new chain that will target millennials. While details regarding the concept weren't available, millennials are a frugal group, often looking for bargains and good values.

That might be due to their values, but it could also reflect the fact that the millennial generation is coming of age during the slow economic recovery that has followed the Great Recession, an era of weak wage growth and, for many, diminished opportunity as inequality increases. Many are also struggling under the burden of student loans, with the class of 2015 graduating as the most indebted ever.

Indeed, while millennials are now the biggest generation in America, they are far from the richest. As a group they are heavily in debt, with half of them reporting that paying down their loans consumes more than half their monthly income, according to a 2014 study by Wells Fargo (WFC). Many are delaying buying a home and starting a family, given their debt issues and the uneven recovery.

A diverse future

The historic shift in America's racial composition is most visible in certain parts of the country. There are five U.S. states where the population has already shifted to a majority-minority, according to the latest Census data.

Hawaii has the most diverse population, with 77 percent of its residents counting as members of a minority race or ethnic group. Next is Washington, D.C., at 64.2 percent, followed by California at 61.5 percent. New Mexico is the fourth-most diverse state, at 61.1 percent, with Texas ranking fifth at 56.5 percent.

Several other states are on the threshold of switching from being predominantly white to a majority-minority. They include Nevada, with 48.5 percent of its population considered minorities.

What does America's minority population look like? Hispanics are the largest group, with 55.4 million as of July 2014, or an increase of 2.1 percent from the previous year.

The black population counts 45.7 million Americans, an increase of 1.3 percent since July 2013. Asians are the third-largest group, at 20.3 million, an increase of 3.2 percent from the previous year. American Indians totaled 6.5 million in mid-2014, an increase of 1.4 percent since the previous year.

As for non-Hispanic whites, there are 197.9 million in the country, an increase of 0.5 percent from the previous year.