Andy G. is not having a good summer. The caddy at one of Nantucket’s top golf courses, who didn’t want to be identified, had every expectation of going back to college at summer’s end loaded with cash. Instead, he is taking on extra jobs to meet his budget, and thinking about waiting tables next summer.

Golf’s popularity is diminishing even outside of Nantucket, and has been doing so for some time. Through June of this year, the number of rounds of golf played was off by 1.8% versus 2006 and rounds played at private clubs was down almost 3%. According to the people at the National Golf Foundation, the number of golf facilities in America dropped last year for the first time since World War II. Across the country, only 119 new courses opened in 2006 while 146 shut down. In 2000, when enthusiasm for the game reached a peak, nearly 400 new courses came on line.

Michael Turnbull is the director of golf business with TeeMaster, a company that among other things provides online tee time reservations for people in the Minneapolis area. He blames the industry for not paying attention to customers. “In the 1990s, people gave three reasons for quitting golf: the cost, the difficulty, and the time commitment. What did we do? We raised greens fees way faster than inflation and developed a lot of really tough courses. Now I work trying to keep people from leaving the game — especially juniors, women, and seniors. We definitely see fewer players playing less golf.”

Indeed, the NGF confirms there has been a fall-off in golf play nationally. The number of so-called core golfers (those that play eight rounds or more each year) declined to 15 million last year from a peak level of 17 million in 2000; in 1986, the figure stood at 12 million. The number of rounds played in America has followed a similar pattern: total rounds played peaked at 518 million in 2000 and fell to 501 million last year.

If these figures surprise you, you’re in good company. After all, you can barely turn on the television these days without tuning in to Tiger Woods putting for yet another birdie. And you may live in one of the communities — like New York — where the number of new courses being developed lags behind demand, and where tee times are hard to come by. But while golf seems to be booming, in reality the industry is treading water.

The waning of golf’s popularity, however, could be temporary. As is true of many trends in the U.S., the 78 million Americans born between 1946 and 1964 — aka the baby boomers — is an influential bunch. And these boomers are about to be spending a lot less time at work and, presumably, more time on the golf course.

The AARP knows all about the coming wave of boomers, having surveyed them as to choices and preferences for some time. In a study done last year, they asked people turning 60 what they would consider the best possible birthday gift. One of the respondents said “18 holes at Pebble Beach.” More broadly, the survey reported that 87% of those surveyed aspired to “taking better care of my physical health.”

One of the ways retiring people have traditionally sought exercise is on the golf course. The NGF has studied the impact of the large demographic change on the horizon, and estimates that “golfing baby boomers alone will add 75 to 100 million incremental rounds in the U.S. by 2015.” Specifically, “the total rounds attributable to baby boomers will gradually rise from about 160 million today to between 235 and 260 million by 2015.”

There are today 36 million Americans between age 60 and 80 — many of whom are golf enthusiasts and who actually have time to play the game. This figure is expected to grow to 65 million by 2025. Unless this group behaves differently that its predecessors, it will likely lengthen the wait for tee times, and send the caddies back to school financially flush.

The good news for those in the industry is that a slightly higher number of people in various age groups are playing golf than was the case 20 years ago. The bad news is that they play less frequently. The overall participation rate in the U.S. was 12.6% in 2005, compared with 10.2% in 1985. While people are playing less frequently, the difference pales in comparison to the steep climb in average rounds by age. People in their 30s tend to play about 10 rounds a year, while those in their 60s play 25 to 35 rounds.

These figures could mean a sharp rise in golf activity over the next 20 years. That will certainly come as good news to golf suppliers such as Callaway (ELY $16). After participating in the golf euphoria of the 1990s, which saw the company’s stock hit an all-time high of $34 in 1997, Callaway ran into product cycle issues and then went through a tough time following the death of founder Ely Callaway in 2001. KathrynThompson ofAvondale Partners says she thinks the skies may finally be brightening for the company, and is consequently recommending the stock to her clients.

“There have been a number of company-specific issues,” Ms. Thompson says. “The company is in the midst of a turnaround.” Part of the story is the likely impact of a new CEO, George Fellows, who took the reins in 2005, providing some much-needed leadership. Callaway in 2003 had acquired Top-Flite, which Ms. Thompson acknowledges was like catching a falling knife, so dismal was the brand. The company is expected to benefit from consolidating manufacturing facilities, and from continued growth in certain overseas markets, especially in the Far East. Importantly, she also reports that “Callaway’s FT-i square-head driver, launched earlier this year, has been very successful. They can’t keep up with demand.”

Callaway is not the only party interested in seeing golf activity pick up. Numerous networks and publishers, clothing designers, and real estate developers have invested in the public’s enthusiasm for the game. Although the outlook may be brightening, Kathy Bissell of Jacksonville, Fla., brokers golf courses and reports that “it is still a buyers’ market in some areas.” Ms. Bissell operates nationally and says prices for courses can run as high as $100 million, including hotels and other properties. As a possible sign of the bottoming out of the market, however, she is currently marketing a nine-hole course in Kansas for a mere $100,000. Golf, anyone?

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