Why Are So Many People Leaving New York?

Residents fled New York State again in the first half of 2015, according to the Empire Center:

During the 12 months ending last July 1, 153,921 more residents moved out of New York than moved into it from other states, according to the U.S. Census Bureau’s annual update of population estimates. The Census Bureau also slightly increased its estimate of New York’s prior year (2013-14) outflow to other states, to a new total of 160,329.

The latest estimates bring New York’s total “net domestic migration” loss since the 2010 census to 653,071 people—the largest such decrease of any state, both in absolute terms and as a percentage of estimated population as of the start of the decade.

The Empire Center doesn’t say why residents are leaving, but we can think of several possible reasons: high taxes, high unemployment upstate, high housing costs in the City, and a large (and corrupt) bureaucracy—for starters.

Since coming into power, Governor Cuomo has promised or proposed tax havens upstate, property tax caps and even cuts, and a simplified tax code. He’s delivered on some of these promises, but only in half measures at best, and his latest proposal to increase the minimum wage to $15 an hour is bad news for upstate businesses. Despite New York City’s well-documented boom, much of the rest of the state isn’t doing so well. Moreover, as we wrote recently, there are plenty of warning signs that Gotham’s bubble may be poised to deflate. If certain financial trends continue (for instance, if the dollar continues to get stronger), Wall Street and tourism—the two great engines of the New York City economy—will have a tough 2016. And if the New York City tax base shrinks, Governor Cuomo’s upstate investment projects will be harder to afford.This isn’t just a New York story. Blue states around the country, like Illinois, California, and Massachusetts, have also experienced large net domestic outflows over the past five years. To varying extents, these losses have been mitigated by foreign immigration inflows (enough, in the cases of California and Massachusetts, to make total net migration positive). Napa Valley’s restaurants still need busboys and New York’s dairy producers still need seasonal farmhands—low-paying jobs in states with high costs of living. But when it comes to stable middle class jobs, these states’ economies often have little to offer people. Without good economic prospects, people look to move to places with lower taxes, better jobs, or cheaper costs of living (or some combination of the three) and so they flock to states like Florida. Telecommuting and the access to global markets made possible by the Internet encourages this migration even more.When the blue model succeeded, it did so because the private-public partnership delivered a stable income and safety net to millions of people. That system hasn’t worked for years, and residents of the bluest states are realizing it’s time to try something new. How long will it take for Albany and Springfield to get the message?