A mass exodus of residents leaving higher tax New York City, Chicago and Los Angeles for warmer and less expensive climates largely drives domestic migration, a U.S. Census Bureau report reveals.
Residents from these high-tax blue states are continuing to move in large numbers to Phoenix, Dallas and Las Vegas, according to Census data.
In 2018, roughly 277 people left New York City every day, 201 people left Los Angeles every day and 161 residents left Chicago every day.
Domestic migration to these metro areas has been negative for most of the 21st century, the Census report notes.
Of the 15 fastest-growing cities with more than 50,000 people, seven are in Texas. The top three fastest growing cities in the U.S. are Frisco, New Braunfels and Pflugerville.
The state’s largest metro areas, Austin, Dallas, Houston, and San Antonio, have collectively grown by more than 3 million since 2010.
According to the Census Bureau, San Antonio posted the greatest population gain between July 1, 2016, and July 1, 2017, adding roughly 66 new residents every day.
San Antonio is now the seventh-largest city in the U.S. with more than 1.5 million people– behind one of the oldest cities in the U.S. and former capitol, Philadelphia.
Houston remains America’s fourth-largest and most diverse large city in the U.S.
The census notes that in order to meet this influx of people, Texas expanded its housing supply by 10.3 percent, more than double the rate of California’s 3.9 percent and New York’s 3 percent over the same period.
One of the reasons people are moving to Texas, Chuck DeVore, vice president of national initiatives at the Texas Public Policy Foundation, says, is economic freedom.
“Economic freedom has a large bearing on growth: freedom allows people to thrive,” DeVore explains.
From 2012 to 2016, 521,052 Californians left the Gold State and moved to Texas, which gained a net of 114,413 Californians.
“That California has the nation’s highest marginal income tax rate and ranks in the worst five for state and local tax burden while Texas has no income tax and ranks in the best five states for taxation means that Texas should continue to double California’s growth in the years to come,” says Chuck DeVore, Vice President of National Initiatives at the Texas Public Policy Foundation.
Not all of the largest metropolitan areas in the country are declining, Bill Bergman, director of research at the nonprofit education group, Truth in Accounting (TIA), told The Center Square.
“Looking across the 50 states and 75 largest cities, population growth and migration trends are significantly related with government fiscal conditions,” Bergman notes. “As a general rule, jurisdictions that have accumulated higher unfunded debt loads (threatening future taxpayers) are reaping what they have sown. Their fiscal pressures have intensified as current and future taxpayers either leave, or don’t move in.”
Based on a comparison of the Census Bureau data and TIA’s latest City Combined Taxpayer Burden report, Bergman says Chicago’s fiscal condition is directly linked to its population exodus.
Conversely, Phoenix and San Antonio have the highest population growth and the best rankings on fiscal condition.
“Granted, slow growth can also impair fiscal strength,” Bergman says. “But our Taxpayer Burden measure represents an outcome of the accumulation of long-term governance practices, not just recent population trends.”