2/16/2020 Leaving Massachusetts: Greater Boston has a people problem - Boston Business Journal SELECT A CITY BOSTON CRANE WATCH YOUR ACCOUNT Get the latest on development projects in Greater Boston [email protected] INDUSTRIES & TOPICS NEWS LISTS & LEADS PEOPLE & COMPANIES EVENTS LEADERSHIP TRUST MORE… FOR THE EXCLUSIVE USE OF [email protected] From the Boston Business Journal: https://www.bizjournals.com/boston/news/2020/02/07/leaving-massachusetts-greater-boston-has-a-people.html COVER STORY Leaving Massachusetts: Greater Boston has a people problem Feb 7, 2020, 5:00am EST Ever sit slumped behind your steering wheel, miserable in unmoving gridlock, staring ahead at an exit sign for a town whose real estate you could never afford, and think to yourself: You know what this place needs? More people. No? Understandable. But from an economic perspective, more people is exactly what Massachusetts needs. And unfortunately for Greater Boston and Massachusetts as a whole, it’s losing a lot more residents to other states than it’s bringing in, as people head for warmer and cheaper locales, according to new U.S. Census Bureau data. BOSTON BUSINESS JOURNAL In 2018, looking just at people moving within the U.S., nearly 35,000 more people These are the top states draining Massachusetts of ditched Massachusetts than made a new home here. From 2010 to 2018, the most residents. The following figures represent net migration losses — in other words, how many Massachusetts lost over 184,000 more residents to other parts of the U.S. than it more residents moved to these states from picked up, based on annual estimates. Massachusetts in 2018 than who moved to Massachusetts. Things are getting worse. The number of people moving into the state from elsewhere in the U.S. didn’t change much from 2010 to 2018. But the number of people moving out increased by 24%. The high cost of housing and ever-longer commutes are two of the main reasons why, economists say. That matters because one of the Massachusetts economy’s most significant problems right now is a shortage of workers. The unemployment rate has been under 4% for almost four years. Local companies, particularly in sectors like technology, manufacturing and health care, are leaving business on the table because there aren’t enough skilled workers available to hire. Lately, Massachusetts’ economic growth rate has fallen behind that of the country’s as a whole. The state’s gross domestic product growth lagged U.S. GDP growth in two of the last three quarters, according to the MassBenchmarks economic index. “I think the biggest issue facing the state is this binding constraint of slow labor force growth,” said Robert Nakosteen, a professor at the University of Massachusetts Amherst. Those moving elsewhere in the U.S. are taking a lot of money with them — nearly $7.6 billion in adjusted gross income annually, according to 2017-18 Internal Revenue Service data. Even when you factor in the income coming into the state from those moving here, the Bay State economy is losing out on $1.5 billion in income annually. Massachusetts has long made up for a domestic outflow of residents by welcoming immigrants from other countries. But under President Donald Trump, foreign immigration has dropped off sharply, falling by over 40% in Massachusetts from 2017 to 2019, according to new Census Bureau estimates. At this point, foreign immigration isn’t getting the job done when it comes to making up for the drainage of people to other corners of the country. In 2019, for the first time in more than a decade, overall net migration into Massachusetts (including https://www.bizjournals.com/boston/news/2020/02/07/leaving-massachusetts-greater-boston-has-a-people.html?s=print 1/3 2/16/2020 Leaving Massachusetts: Greater Boston has a people problem - Boston Business Journal both other states and foreign countries) was negative, according to MassBenchmarks. You might think that Boston and its affluent suburbs are drawing in people like a magnet, while residents in less economically vibrant parts of the state are loading up their cars and booking it out of town. But that’s not totally the case. It’s true that Suffolk County (which encompasses Boston, Chelsea, Winthrop and Revere) gained thousands of residents from elsewhere in the U.S. on net in 2017, the most recent year for which census estimates are available. (Its biggest source of new arrivals? Brooklyn.) However, every other county that makes up Greater Boston saw net outflows of residents domestically. The high cost of housing is a major contributor to workers leaving the state, economists say. There are several bills on Beacon Hill aimed at easing the housing crunch, including bringing back rent control. Gov. Charlie Baker has proposed zoning changes to make it easier for cities and towns to build housing, but the bill has languished in the Legislature. “That’s my hope, that this year will see some movement on housing policy,” Northeastern University economics professor Alicia Sasser Modestino said. “We’re at that point in the cycle where we’re just shooting ourselves in the foot.” The Body Snatchers Here are the top states draining Massachusetts of the most residents. The following figures represent net migration losses — in other words, how many more residents moved to these states from Massachusetts in 2018 than who moved to Massachusetts. FLORIDA Net gains from Mass.: 10,859 The good news? Many of those Florida-bound are retirees and not part of the workplace. The bad news? The snowbirds are taking their considerable purchasing power out of state: In 2018, their combined income was over $1.2 billion, according to IRS data. NEW HAMPSHIRE Net gains from Mass.: 9,165 Bay Staters are lured north by the cheaper housing and tax-free living. Some of them continue to commute into Massachusetts for work, though locally based companies like Fidelity Investments and Liberty Mutual have followed the migrants to New Hampshire, opening sizable offices there. CALIFORNIA Net gains from Mass.: 3,628 Here’s one state that isn’t attracting Massachusetts residents because it’s cheaper. A good chunk of the thousands moving here annually are some of the most sought-after workers in Massachusetts: high-tech employees lured by Silicon Valley’s siren song. SOUTH CAROLINA Net gains from Mass.: 3,316 Another popular retirement destination. It’s not just restaurant visits and retail purchases that Massachusetts loses when people flee the cold weather, it’s wealth that could be managed by Greater Boston’s financial services industry. COLORADO Net gains from Mass.: 2,775 https://www.bizjournals.com/boston/news/2020/02/07/leaving-massachusetts-greater-boston-has-a-people.html?s=print 2/3 2/16/2020 Leaving Massachusetts: Greater Boston has a people problem - Boston Business Journal Only a handful of states nationwide attract more migrants than Colorado and its great outdoors. Denver is similar in size to Boston, with a growing startup scene — and it’s less expensive to live there. Greg Ryan Law and Money Reporter Boston Business Journal https://www.bizjournals.com/boston/news/2020/02/07/leaving-massachusetts-greater-boston-has-a-people.html?s=print 3/3.