6 State Exodus 16p

Research Bulletin October 2009

EMPIRE

Empire State Exodus The Mass Migration of New Yorkers to Other States Wendell Cox and E.J. McMahon

CENTER FOR NEW YORK STATE POLICY A project of the Manhattan Institute for Policy Research

EXECUTIVE SUMMARY The Empire State is being drained of an invaluable resource—people. From 2000 to 2008, in both absolute and relative terms, New York experienced the nation's largest loss of residents to other states—a net domestic migration outflow of over 1.5 million, or 8 percent of its population at the start of the decade. Based on the latest data from the Census Bureau and the Internal Revenue Service (IRS), this report examines how many New Yorkers have been leaving the state, where they have been going and how much income they have been taking with them. Focusing on the period since 2000, key findings include the following: •

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P.O. Box 7113, Albany, New York 12224 • PH: 518-4321505 • www. empirecenter.

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The annual net loss of New Yorkers to other states has ranged from a high of nearly 250,000 people in 2005 to a low of 126,000 last year, when moves nationwide slowed down sharply along with the economy. California was the only other state to lose more than a million residents to out-migration during the 2000-2008 period. Most of the New York State out-migrants tracked by the IRS originated in the metropolitan New York City region. Migration rates are lower upstate, but the net population impact has been larger. Nearly 60 percent of the New York out-migrants moved to southern states—with Florida alone drawing nearly one-third of the total. Thirty percent moved to the neighboring states of New Jersey, Pennsylvania and Connecticut. Households moving out of New York State had average incomes 13 percent higher than those moving into New York during the most recent year for which such data are available. In 2006-07 alone, the migration flow out of New York drained $4.3 billion in taxpayer income from the state.

New York State’s net domestic migration loss during this decade is the continuation of a longer-term trend. During the 1990s, New York lost 1.7 million people to other states. Even with its large domestic migration losses, New York’s total population has grown slightly since 2000, thanks to a large influx of immigrants from foreign countries. But New York’s share of U.S. population is still shrinking. A continuation of the domestic migration trends highlighted here will translate into slower economic growth and diminishing political influence in the future.

P.O. Box 7113

Albany, NY 12224

518-434-3100

www.empirecenter.org

Table 1: Net Domestic Migration, 2000-08 Alabama Alaska Arizona Arkansas California Colorado Connecticut Delaware District of Columbia Florida Georgia Hawaii Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming

Total 75,285 -8,217 700,679 67,805 -1,359,270 158,867 -95,887 41,278 -43,457 1,249,709 525,071 -22,199 111,513 -566,897 -17,524 -47,071 -65,769 73,023 -317,978 27,784 -85,855 -295,288 -469,549 -44,500 -27,272 37,317 36,238 -37,132 364,953 29,490 -430,250 28,283 -1,538,274 580,286 -19,396 -338,667 23,182 157,631 -49,193 -41,728 271,449 5,459 239,847 701,065 47,896 -1,919 152,897 199,180 12,787 -11,403 15,721

* Net migration as a percentage of 2000 population Source: US Bureau of the Census

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Rank 14 29 3 16 50 10 43 18 37 1 5 33 13 49 31 39 41 15 45 23 42 44 48 38 34 19 20 35 6 21 47 22 51 4 32 46 24 11 40 36 7 27 8 2 17 28 12 9 26 30 25

Rate* 1.7% -1.3% 13.6% 2.5% -4.0% 3.7% -2.8% 5.2% -7.6% 7.8% 6.4% -1.8% 8.6% -4.6% -0.3% -1.6% -2.4% 1.8% -7.1% 2.2% -1.6% -4.6% -4.7% -0.9% -1.0% 0.7% 4.0% -2.2% 18.1% 2.4% -5.1% 1.6% -8.1% 7.2% -3.0% -3.0% 0.7% 4.6% -0.4% -4.0% 6.7% 0.7% 4.2% 3.3% 2.1% -0.3% 2.2% 3.4% 0.7% -0.2% 3.2%

Rank 22 34 2 16 44 12 40 8 50 4 7 37 3 45 29 35 39 21 49 18 36 46 47 32 33 27 11 38 1 17 48 23 51 5 42 41 26 9 31 43 6 24 10 14 20 30 19 13 25 28 15

Migration in Context Moving is a way of life in the United States. Americans migrated from the original 13 colonies to the Midwest in the 19th century, and to the Southwest and the West in the early 20th century. The mid-20th century saw an exodus of African-Americans from agricultural areas of the south to industrial areas in the Northeast and Midwest. After World War II, the population tide shifted from the Northeast and Midwest to the Sunbelt states of the South and West, a trend that accelerated in the last quarter of the 20th century. More recently, domestic migration has been strongest to the Rocky Mountain states, as well as to the South. Retirees have accounted for a large share of the migration from the Frost Belt of the Northeast and Midwest to the Sunbelt, with the largest number going to Florida. Since 2000, between 1,000,000 and 2,000,000 Americans—0.5 percent of the population, on average—have moved from one county to another every year, census data show.

State Domestic Migration Trends: 2000-2008 New York’s share of the nation’s population declined sharply in the second half of the 20th century, from 19 percent of all Americans in 1950 to less than 7 percent in 2000. The state has been a net domestic migration loser for many years, though annual state level data from the Census Bureau is only available since 1990. During the 1990s, New York lost an average of 1.2 percent of its population to other states every year, according to the Census Bureau. The average annual rate of domestic migration loss for this decade is almost unchanged, at 1.1 percent a year. As shown in Table 1, New York State lost 1,538,000 residents between 2000 and 2008, more than any other state. California, with the second-largest net migration outflow, was the only other state to lose more than a million residents during the period. New York also had the highest percentage loss in domestic migration—equivalent to 8.1 percent of 2000 population. Not even hurricane-ravaged Louisiana lost so much of its base-year population to domestic migration during this decade.

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The rise and fall of domestic migration from New York since 2000, as illustrated in Figure 1, has been generally consistent with national trends. Migration throughout the country ebbed during the recessionary period early in the decade and increased in synch with the housing bubble and economic growth after 2004, slowing again after the bubble burst in 2007. The state’s peak losses, both in absolute and relative terms, came between 2004 and 2006, when the state lost 614,877 residents more than it gained from the rest of the country. But relative to other states, New York’s highest rate of out-migration came between 2000 and 2004, when the impact of the relatively brief 2000-01 recession was compounded by a sharp Wall Street downturn and the 9/11 terrorist attacks. Table 2: Net Domestic Migration in Counties and Regions of New York State, 2000-08 Total Albany County 1,348 Allegany County -580 Bronx County -101,495 Broome County -4,874 Cattaraugus County -5,144 Cayuga County -2,665 Chautauqua County -5,847 Chemung County -3,903 Chenango County -452 Clinton County 1,197 Columbia County -255 Cortland County -1,005 Delaware County -886 Dutchess County 5,992 Erie County -40,635 Essex County -529 Franklin County -836 Fulton County 233 Genesee County -3,028 Greene County 1,670 Hamilton County -114 Herkimer County -1,658 Jefferson County -7,533 Kings County -210,312 Lewis County -1,495 Livingston County -2,057 Madison County -734 Monroe County -20,783 Montgomery County -665 Nassau County -62,506 New York County -555 Niagara County -5,043 Oneida County -3,417 Onondaga County -16,638 Ontario County 2,936 Source: Census Bureau

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Rate 0.5% -1.2% -7.6% -2.4% -6.1% -3.3% -4.2% -4.3% -0.9% 1.5% -0.4% -2.1% -1.8% 2.1% -4.3% -1.4% -1.6% 0.4% -5.0% 3.5% -2.1% -2.6% -6.8% -8.5% -5.5% -3.2% -1.1% -2.8% -1.3% -4.7% 0.0% -2.3% -1.5% -3.6% 2.9%

Orange County Orleans County Oswego County Otsego County Putnam County Queens County Rensselaer County Richmond County Rockland County Saratoga County Schenectady County Schoharie County Schuyler County Seneca County St Lawrence County Steuben County Suffolk County Sullivan County Tioga County Tompkins County Ulster County Warren County Washington County Wayne County Westchester County Wyoming County Yates County

Total 17,259 -2,554 -3,316 911 -217 -167,439 1,041 7,349 -15,565 9,892 3,200 492 -223 602 -3,284 -2,812 -27,617 1,165 -2,650 2,534 2,446 2,629 1,649 -4,421 -25,305 -2,126 -267

Rate 5.0% -5.8% -2.7% 1.5% -0.2% -7.5% 0.7% 1.6% -5.4% 4.9% 2.2% 1.6% -1.2% 1.8% -2.9% -2.8% -1.9% 1.6% -5.1% 2.6% 1.4% 4.1% 2.7% -4.7% -2.7% -4.9% -1.1%

New York City In-State NYC Region Albany MSA Buffalo MSA Rochester MSA Syracuse MSA Balance of State

-1,118,025 -1,362,088 6,382 -54,165 -43,302 -26,945 -58,156

-13.9% -10.7% 0.8% -4.6% -4.2% -4.1% -1.8%

As shown in Table 2, the five counties of New York City lost more than 1.1 million people—nearly 14 percent of the city’s 2000 population—to other states and neighboring communities. The New York State portion of the New York City Metropolitan Statistical Area (MSA) as a whole also was a net loser, although three counties within the region (Dutchess, Orange and Ulster) were net gainers via migration.1 The five-county Albany region was the only MSA in the state to gain residents through domestic migration, as measured by the Census Bureau. This was due largely to strong gains in Saratoga County, which was one of four New York counties to experience net migration gains equivalent to more than 3 percent of 2000 population. Fourteen other counties experience net migration rates of between 0.4 and 2.9 percent. All the rest—some 39 counties outside the New York City region—lost people to domestic migration, with the biggest upstate percentage losses concentrated in Western New York and Southern Tier counties (see map in Figure 2, below). The Census Bureau estimates of domestic migration at the county and regional level are not limited to out-of-state moves, however; they include moves within New York (for example, Saratoga’s net gain includes migrants from downstate). To more precisely track where New Yorkers are moving— in and out of state—it is necessary to turn to another data source.

Figure 2: Net Domestic Migration Rates* by County Census-Based Estimates for 2000-08 Rates = Percentage of 2000 Population

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Table 3: Net Taxpayer* Migration, New Yorkers From (To) Other States Total Individuals Claimed as Exemptions on Federal Income Tax Forms, 2000-07

Alabama Alaska Arizona Arkansas California Colorado Connecticut Delaware DC Florida Georgia Hawaii Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico North Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming Total

2001

2002

2003

2004

2005

2006

2007

Total

Rank

Share

(471) 48 (2,358) (49) (5,873) (1,081) (5,625) (684) 154 (34,656) (6,525) (288) (10) 279 (318) 174 (9) (168) (68) (481) (3,733) (4,011) (895) (431) 3 172 (41) (14) (1,713) (897) (24,163) (36) (7,395) 23 (1,114) (78) (336) (7,555) (1,004) (2,630) (14) (520) (2,418) 104 (297) (5,836) (560)

(477) (36) (2,459) (51) (3,437) (731) (7,275) (785) (111) (39,096) (6,871) (199) (64) 351 (306) (11) (145) (189) (78) (609) (3,935) (1,533) 208 (323) (176) (449) (71) 93 (1,698) (384) (23,430) (376) (8,199) (18) (846) (162) (465) (10,142) (1,068) (2,872) 4 (1,041) (2,970) (29) (176) (6,163) (354)

(445) (97) (2,261) (126) (2,171) (418) (8,564) (998) (193) (37,770) (6,086) (102) (141) 202 (325) 54 (11) (248) (245) (544) (3,683) (488) (244) (353) (49) (283) (76) (143) (1,547) (86) (23,390) (362) (7,074) 25 (1,072) 11 (82) (13,005) (995) (3,109) (22) (859) (2,620) 109 (7) (6,337) (428)

(981) (96) (3,067) (333) (2,641) (595) (7,986) (1,304) (172) (53,145) (8,692) (116) (135) (267) (379) (65) 44 (727) (174) (496) (4,047) 693 13 (249) (200) (281) (120) (99) (2,330) (140) (26,488) (328) (10,273) 2 (1,661) (161) (41) (15,115) (808) (3,733) 11 (1,494) (3,015) 39 31 (8,090) (248)

(631) (2) (3,532) (169) (3,842) (750) (8,757) (1,468) (222) (62,600) (10,648) (275) (86) (126) (578) 74 (120) (524) (372) (466) (3,918) 71 68 (29) (107) (24) (92) (80) (2,624) (299) (26,923) (528) (14,418) 53 (783) 90 (306) (15,437) (217) (4,912) (48) (1,991) (3,782) 124 (78) (8,073) (162)

(730) (44) (3,992) (337) (3,779) (936) (7,802) (1,446) 1 (52,073) (12,681) (197) (152) 175 (419) (126) (332) (385) 885 (330) (3,506) 12 648 (117) (27) (302) (57) (92) (2,344) (289) (24,144) (425) (16,968) 34 (428) (131) (516) (15,613) (128) (5,321) (3) (1,945) (5,179) (60) (139) (6,505) (1,092)

(627) (45) (3,221) (206) (3,467) (1,083) (5,446) (992) 53 (32,800) (12,742) (251) (27) (409) (584) (75) (292) (480) (472) (323) (2,995) (446) 1,044 (148) (207) (96) (138) (27) (1,738) (189) (18,529) (384) (17,862) (31) (451) (35) (507) (12,094) 65 (5,699) (92) (1,622) (5,799) (221) (159) (5,337) (734)

(4,362) (272) (20,890) (1,271) (25,210) (5,594) (51,455) (7,677) (490) (312,140) (64,245) (1,428) (615) 205 (2,909) 25 (865) (2,721) (524) (3,249) (25,817) (5,702) 842 (1,650) (763) (1,263) (595) (362) (13,994) (2,284) (167,067) (2,439) (82,189) 88 (6,355) (466) (2,253) (88,961) (4,155) (28,276) (164) (9,472) (25,783) 66 (825) (46,341) (3,578)

19 44 12 30 11 18 6 15 39 1 5 29 36 50 23 47 33 24 38 22 9 17 51 28 35 31 37 42 13 26 2 25 4 49 16 40 27 3 20 8 45 14 10 48 34 7 21

0.4% 0.0% 2.0% 0.1% 2.5% 0.5% 5.0% 0.7% 0.0% 30.4% 6.3% 0.1% 0.1% 0.0% 0.3% 0.0% 0.1% 0.3% 0.1% 0.3% 2.5% 0.6% -0.1% 0.2% 0.1% 0.1% 0.1% 0.0% 1.4% 0.2% 16.3% 0.2% 8.0% 0.0% 0.6% 0.0% 0.2% 8.7% 0.4% 2.8% 0.0% 0.9% 2.5% 0.0% 0.1% 4.5% 0.3%

(26)

(161)

(212)

(254)

(159)

(183)

(81)

(1,076)

32

0.1%

6

(71)

(2)

(114)

(176)

(58)

28

(387)

41

0.0%

(11)

(42)

12

(41)

(62)

(54)

(76)

(274)

43

0.0%

(123,429)

(129,428)

(126,860)

(159,868)

* Includes primary income tax filer and all exemptions claimed for dependents. Source: Internal Revenue Service

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(179,916)

(169,632)

(138,049)

(1,027,182)

Taxpayer Migration The Internal Revenue Services (IRS) records the movement of taxpayers and their dependents across county lines, based on year-to-year changes in the addresses shown on individual income tax returns. This does not capture all migration; for example, it excludes tax return non-filers, who could make up as much as 8 percent of the workforce, according to some estimates.2 However, the IRS data remain the single best source of data on county-to-county moves within the United States, and (in gross term) on the incomes of migrating American households.3 As shown in Table 3, just over 1 million taxpayers and their dependents moved from New York to other states between 2000 and 2007. Florida was the most common destination, favored by over 30 percent of New York migrants, followed by New Jersey, Pennsylvania and North Carolina in that order. A total of 45 states, plus the District of Columbia, gained taxpayers at New York’s expense during the period, as illustrated in Figure 3. Two of the five states from which New York gained migrants—Illinois and Michigan— sustained net migration losses almost as severe as New York’s, as measured by the Census Bureau (see Table 1 on page 2.)

Figure 3: Net Taxpayer and Dependent Migration Gains (Losses) from New York, 2000-07

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Table 4: Net Taxpayer* Migration, New York Regions From (To) Other States Total Individuals Claimed as Exemptions on Federal Income Tax Forms, 2000-07 Metropolitan Statistical Areas (MSAs) Rest of Albany Buffalo NYC Region Rochester Syracuse NYS Alaska 0 -49 -120 -24 0 (21) Alabama 0 -161 -1,172 -31 0 582 Arizona -679 -1,838 -12,714 -1,279 -553 (1,700) Arkansas 0 0 16 0 0 California -586 -1,258 -20,086 -1,664 -726 (1,080) Colorado -73 -537 -3,210 -494 -151 (200) Connecticut -240 -134 -51,732 -184 -328 (97) Delaware 0 -108 -6,720 -157 -70 (66) D.C. -189 -173 269 -206 -137 (79) Florida -6,634 -11,497 -255,850 -9,560 -5,962 (10,946) Georgia -1,232 -1,768 -46,343 -1,789 -863 (850) Hawaii -141 -14 -923 -31 -102 82 Idaho 0 0 20 0 0 Illinois 45 -499 2,213 -221 -493 (169) Indiana -22 -208 -402 -123 -48 20 Iowa 0 -16 214 15 -23 Kansas 0 -73 -1,132 -26 0 412 Kentucky 0 -161 -565 -105 1 238 Louisiana -10 -8 357 -71 38 7 Maine -30 -11 -919 -35 54 (18) Maryland -366 -1,264 -19,542 -1,113 -677 (1,045) Massachusetts 439 -446 -4,940 -813 -383 (1,170) Michigan -24 -277 1,384 9 20 (167) Minnesota 30 -113 -606 -175 -124 (11) Mississippi 0 18 52 0 0 Missouri 0 -93 302 -119 -53 (18) Montana 0 0 38 0 0 Nebraska 0 -9 -41 6 16 (33) Nevada -469 -1,187 -10,505 -614 -312 (791) New Hampshire 157 -63 -1,414 -149 -7 41 New Jersey 772 -342 -172,072 -571 13 328 New Mexico -29 -71 -809 -45 -7 (22) North Carolina -1,626 -4,496 -47,300 -3,936 -2,088 (2,902) North Dakota 0 0 0 0 0 Ohio -79 -955 -1,784 -266 -234 (122) Oklahoma 0 -70 73 -56 0 40 Oregon -38 -75 -335 -228 -36 (27) Pennsylvania -395 -1,102 -84,078 -811 -854 (946) Rhode Island -22 -97 -3,690 -75 -19 151 South Carolina 949 -1,540 -15,384 -1,105 -640 (1,186) South Dakota 0 0 0 0 0 Tennessee 0 -426 -1,883 -262 -190 (209) Texas -317 -1,395 -16,396 -1,296 -518 (1,065) Utah -12 -81 175 0 9 11 Vermont 556 -92 -945 -30 -23 851 Virginia -1,453 -2,079 -26,325 -2,072 -1,143 (1,324) Washington -419 -364 -1,006 -195 -182 (549) West Virginia 0 0 53 0 0 Wisconsin 0 -100 72 -178 -20 35 Wyoming 0 0 -58 0 0 Total -12,137 -35,232 -805,763 -30,079 -16,815 (24,015) * Includes primary income tax filer and all exemptions claimed for dependents ** Does not include non-allocated residual counted as part of total New York out-migration in Table 3 totals Source: Internal Revenue Service

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Total** (214) (782) (18,763) 16 (25,400) (4,665) (52,715) (7,121) (515) (300,449) (52,845) (1,129) 20 876 (783) 190 (819) (592) 313 (959) (24,007) (7,313) 945 (999) 70 19 38 (61) (13,878) (1,435) (171,872) (983) (62,348) (3,440) (13) (739) (88,186) (3,752) (18,906) (2,970) (20,987) 102 317 (34,396) (2,715) 53 (191) (58) (924,041)

As shown in Table 4a, the migration pattern to other states was not uniform among different New York regions. While just over half the net migration flow from New York metropolitan region was headed South, nearly 40 percent of the taxpayers lost by that region moved to other states in the northeast, mainly neighboring New Jersey, Pennsylvania and Connecticut. The net migration flow from upstate regions overwhelmingly favored the South and West, with fewer headed to the New York’s neighbors. This tendency was most pronounced in the Albany MSA, whose entire net taxpayer migration loss was to the South (82 percent) and West (19 percent). Albany, alone among New York regions, gained taxpayer-migrants from the rest of the Northeast, according to the IRS data.

Taxpayer migration within New York As detailed in Table 5, the migration of taxpayers and their dependents within New York City reflects long-standing population flows from Manhattan to outer boroughs, from Brooklyn to Staten Island, and from all five boroughs— especially Queens—to suburban counties. Roughly 62 percent of the intrastate New York taxpayer-migrants from New York City ended up in the inner-ring suburbs of Westchester and Nassau County. New York City also lost a net 15,317 taxpayer-migrants to upstate New York regions, and 346,777 taxpayer-migrants to other states. The New York City region as a whole, including the suburban counties, lost 24,363 taxpayers and their dependents to upstate New York, which in turn lost 159,995 taxpayermigrants to the rest of the country. The region-by-region breakdown is shown in Table 5a.

Table 4a: Share of New York Taxpayer Out-Migrants by Region, 2000-07 To (Census Regions):

From (Metropolitan Statistical Areas): Albany Buffalo NYC Region

Northeast

Rochester

Syracuse

Rest of NYS

Total

-10.2%

6.5%

39.7%

8.9%

9.2%

3.6%

35.3%

88.1%

70.8%

54.2%

71.7%

72.0%

78.0%

56.8%

0.4%

6.7%

0.0%

3.6%

5.7%

0.2%

0.5%

19.0%

15.4%

6.0%

15.0%

11.6%

18.1%

7.3%

CT, ME, MA, NH, NJ, PA, RI, VT

South AL, AR, DE, DC, FL, GA, KY, LA, MD, MI, NC, OK, SC, TN, TX, VA, WV

Midwest IL, IN, IA, KS, MI, MN, MO, NE, ND, OH, SD, WI

West AK, AZ, CA, CO, HI, ID, MT, NV, NM, OR, UT, WA, WY Source: Internal Revenue Service

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Table 5: Net Domestic Migration of Taxpayers* To and From New York City, 2000-07 To: From: Manhattan The Bronx Brooklyn Queens Staten Island City: Total Westchester-Nassau

Manhattan

The Bronx 34,383

(34,383) (21,119) (8,547) (431) (64,480) (32,710) (2,243) (7,921) (42,874) (107,354) 306 2,180 (116,127)

Putnam-Rockland-Suffolk Dutchess-Orange-Ulster Suburbs: Total New York MSA Region Total Other NYS Other US (104,868) Total

Brooklyn 21,119 (4,955)

4,955 2,127 (907) 40,558 (40,553) (10,769) (20,253) (71,575) (31,017) (4,030) (81,080) (263,925)

Queens 8,547 (2,127) 41,686

(41,686) (43,429) (68,951) (49,240) (26,169) (10,356) (85,765) (154,716) (4,875) (104,334) (257,209)

(4,418) 43,688 (105,689) (37,003) (13,107) (155,799) (112,111) (5,547) (139,551) (4,168)

Staten Island 431 907 43,429 4,418 49,185 (9,807) (16,144) (2,239) (28,190) 20,995 (1,171) (23,992) (746,297)

City: Total 64,480 (40,558) 68,951 (43,688) (49,185) (237,999) (92,328) (53,876) (384,203) (384,203) (15,317) (346,777) -746,297

Table 5a: Net Domestic Migration of Taxpayers*, All New York Regions, 2000-07 From (MSAs): Albany Buffalo Rochester Syracuse Other NYS Other US Total

To (MSAs): Albany 310 312 913 3,264 (14,270) (9,471)

Buffalo Rochester (310) (312) 135 (135) 61 696 276 3,192 (39,175) (38,725) (39,283) (35,014)

Syracuse (913) (61) (696) 3,608 (21,493) (19,555)

NYC Region (13,317) (681) (854) (1,190) (24,363) (867,187) (907,592)

Other NYS (3,264) (276) (3,192) (3,608) (46,332) (56,672)

Rest of US 14,270 39,175 38,725 21,493 46,332 1,027,182

* Includes primary income tax filer and all exemptions claimed for dependents Source: Calculations based on Internal Revenue Service data

Migrating Incomes The IRS data also provide adjusted gross incomes for migrating households in the year immediately following a move. Measured on this basis, New York’s annual income loss to migration has ranged from $3.9 billion in 2003, just after the end of the last recession, to $5.6 billion as the economy and real estate bubble were expanding in 2005. This trend is consistent with migration trends as estimated by both Census Bureau and the IRS. As shown in Table 6 on page 11, New York’s net income loss from taxpayer migration was nearly $4.3 billion in 2007, and the annual net income losses from 2001 through 2007 totaled nearly $30 billion. Household incomes change from year to year, so this does not necessarily mean New York was $30 billion worse off at the end of the period. A more precise estimate of the income losses associated with out-migration would require additional information and calculations beyond the scope of this paper. However, both the annual and cumulative income data from IRS returns surely reflects to some extent the magnitude of income flows to other states.

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Total (3,846) 38,602 34,160 18,365 32,309 (1,027,182) -

From 2001 to 2007, New York State’s greatest net income losses, like its greatest population losses, were to Florida and New Jersey, in that order. But Connecticut, the sixth most popular destination state for net migration of individual New Yorkers, ranks third in its net income gain from New York. Conversely, Pennsylvania ranks third in the number of people gained at New York’s expense, but fifth in its net income gain from migrating New Yorkers.

Table 6: Taxpayer Net Domestic Migration Income Flows To (From) New York, 2000-07 (adjusted gross income, in millions of dollars) Alabama Alaska Arizona Arkansas California Colorado Connecticut Delaware DC Florida Georgia Hawaii Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico North Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming Total

2001 ($6.4) $1.5 ($75.9) ($2.4) ($439.0) ($42.5) ($245.0) ($11.9) $22.0 ($973.9) ($79.0) ($15.4) ($2.7) $24.5 $2.4 $9.3 $1.5 ($3.0) $2.5 ($27.5) ($58.9) ($184.7) ($8.6) ($0.3) $0.7 $16.7 ($1.5) $2.1 ($85.2) ($37.0) ($655.9) ($9.0) ($168.5) ($0.2) ($7.3) $0.3 ($15.6) ($88.0) ($19.6) ($92.6) ($0.5) ($13.4) ($40.5) ($11.2) ($37.4) ($104.0) ($31.7) $1.3 ($0.5) ($19.5) ($3,531.2)

2002 ($5.9) ($2.3) ($84.8) ($3.0) ($129.1) ($32.7) ($408.1) ($18.0) ($19.4) ($1,141.5) ($146.1) ($10.8) ($3.2) $8.9 ($13.4) ($3.5) ($1.3) ($7.0) $1.6 ($17.6) ($77.6) ($62.4) $19.5 ($12.6) ($4.2) ($7.3) ($3.5) $4.7 ($50.2) ($21.1) ($837.7) ($18.4) ($197.3) ($1.0) ($2.9) ($1.6) ($19.5) ($170.0) ($27.3) ($79.2) ($0.2) ($7.4) ($36.7) ($4.4) ($13.1) ($121.1) ($13.3) ($1.9) ($10.2) $6.2 ($3,808.9)

2003 ($9.1) ($0.9) ($70.4) ($2.9) ($33.6) ($29.1) ($418.3) ($21.1) $1.9 ($1,017.9) ($109.1) ($6.9) ($4.4) $31.8 ($7.9) $3.6 ($2.8) ($7.1) ($3.5) ($38.4) ($69.0) ($14.8) $0.9 ($12.9) ($1.2) $11.8 ($4.0) ($3.6) ($47.3) ($13.2) ($786.7) ($18.6) ($144.0) $0.4 ($22.5) $2.0 ($3.0) ($242.7) ($26.3) ($80.9) ($0.3) ($21.9) ($49.6) ($4.9) ($21.1) ($127.5) ($22.1) ($3.9) ($5.4) $0.0 ($3,478.6)

2004 ($15.3) ($1.1) ($85.6) ($6.6) ($103.5) ($38.9) ($439.5) ($29.3) ($7.4) ($1,331.1) ($139.1) ($8.2) ($6.0) $5.3 ($4.1) ($1.1) $0.3 ($25.8) ($1.0) ($35.1) ($64.8) $58.2 ($1.3) ($11.5) ($7.5) $1.6 ($8.4) ($1.4) ($71.9) ($14.4) ($966.7) ($10.5) ($228.1) ($0.7) $7.9 $7.7 ($3.4) ($278.5) ($20.6) ($120.8) ($0.6) ($30.7) ($74.1) ($5.0) ($14.7) ($165.4) ($12.8) ($4.1) $2.2 ($1.6) ($4,315.1)

2005 ($14.2) ($0.9) ($114.5) ($3.7) ($201.6) ($25.3) ($517.1) ($41.1) $17.2 ($1,840.8) ($171.1) ($11.5) ($1.9) $32.3 ($5.0) $2.0 ($3.3) ($13.5) ($15.5) ($30.2) ($72.5) ($17.4) $1.8 $16.0 ($3.5) $4.2 ($1.7) ($2.1) ($77.4) ($23.2) ($899.1) ($18.1) ($317.7) $0.9 ($28.1) $1.0 ($13.1) ($297.7) ($5.9) ($143.0) ($0.7) ($42.0) ($88.3) ($0.4) ($16.9) ($201.6) ($37.7) ($3.9) ($4.9) ($14.6) ($5,267.0)

2006 ($13.9) ($0.1) ($123.8) ($8.3) ($212.5) ($47.1) ($431.7) ($31.5) $2.7 ($1,614.4) ($214.0) ($15.7) ($3.5) $24.1 ($12.8) ($3.1) ($8.9) ($0.1) $16.4 ($17.1) ($81.0) $2.5 $24.4 ($0.5) $1.9 ($23.2) ($3.7) ($1.5) ($74.3) ($47.1) ($952.6) ($19.8) ($373.4) $0.7 ($2.7) ($2.8) ($19.6) ($276.2) ($3.7) ($145.1) ($1.5) ($50.3) ($118.4) ($6.0) ($43.3) ($142.1) ($41.1) ($4.9) $3.4 $0.2 ($5,116.5)

2007 ($8.0) ($0.3) ($119.5) ($4.9) ($209.8) ($55.8) ($310.4) ($22.9) $19.0 ($1,268.6) ($230.0) ($11.1) $2.2 ($16.9) ($2.8) ($3.0) ($6.6) ($2.4) ($6.8) ($21.1) ($64.9) ($46.3) $43.0 ($8.6) ($2.1) $4.2 ($4.4) $0.9 ($59.0) ($19.3) ($634.5) ($16.5) ($420.2) ($1.2) $15.9 ($1.9) ($23.1) ($171.0) ($8.0) ($151.6) ($4.6) ($36.7) ($199.6) ($8.4) ($12.2) ($108.8) ($43.4) ($0.5) ($4.5) ($2.8) ($4,269.7)

Total ($72.9) ($4.0) ($674.4) ($31.7) ($1,329.0) ($271.5) ($2,770.1) ($175.8) $36.0 ($9,188.2) ($1,088.4) ($79.6) ($19.6) $110.0 ($43.6) $4.2 ($21.2) ($58.8) ($6.2) ($187.1) ($488.7) ($264.9) $79.7 ($30.3) ($15.8) $8.0 ($27.2) ($0.8) ($465.4) ($175.3) ($5,733.2) ($110.9) ($1,849.2) ($1.0) ($39.7) $4.8 ($97.4) ($1,524.1) ($111.4) ($813.2) ($8.3) ($202.4) ($607.1) ($40.3) ($158.7) ($970.5) ($202.1) ($17.9) ($19.9) ($32.2) ($29,787.0)

Rank* 26 42 10 32 6 15 3 48 20 1 7 25 36 50 28 46 37 27 41 18 12 14 49 33 39 47 34 44 13 19 2 23 4 43 29 45 24 5 22 9 40 17 11 30 21 8 16 38 35 31

Source: Calculations from Internal Revenue Service data

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According to the IRS data, 196,544 federal tax returns were filed in 2007 by former New Yorkers who had moved to other states in the previous year, and 137,761 returns were filed by households that moved into New York from other states in the same period. Taxpayer households leaving the state were larger, averaging 1.81 people compared to 1.58 for those entering the state.4 That seemingly small difference of just .22 people per household translated into an added 45,000 people leaving the Empire State in 2006-07 – including an untold number of children and young adults. Migrant households in both directions were smaller than those who stay put in New York, which averaged 2.08 persons.

Incomes In, Incomes Out The average adjusted gross income of taxpaying households leaving New York between 2006 and 2007 was $57,144, while the average income of households moving into New York was $50,533—a difference of 13 percent. Nonmigrating New York households as of 2007 had an average income of $63,277. A county-by-county breakdown of average incomes for interstate migrants to and from New York is presented in Table 7a on page 13. As shown, in 26 of New York’s 62 counties, the average income differential was the reverse of the statewide average; i.e., in these counties, the average incomes of in-migrants from other states were roughly equivalent to or exceeded the average incomes of out-migrants to other states. With few exceptions (most notably, Cattaraugus County in western New York State), higher or roughly equivalent inmigrant incomes were concentrated in less populous, rural upstate counties. The average income differentials for out-migrants matched or exceeded the statewide average in New York City, Long Island and the lower Hudson Valley suburbs, as well as in all of the most urbanized and populous upstate counties (except for Onondaga County, which includes Syracuse). The largest differential in absolute terms was in New York County (the borough of Manhattan), where the average out-migrant income of $93,264 was 28 percent higher than the in-migrant average of $72,726. The percentage differentials between out-migrants and in-migrants were even higher in the rest of the city. Turning to a state-level comparison, as detailed in Table 7b on page 14, migrants from New York had higher average incomes than migrants to New York in 38 out of 50 states between 2006 and 2007. New Yorkers migrating to Florida, the most common destination state, had incomes nearly $20,000 higher than the smaller number making the reverse move. The differential was also striking among New York migrants to and from Connecticut. The average income data for migrants to and from New York reflect the same pattern as the aggregate income and population data: southeastern states, and neighboring Connecticut and New Jersey, have been the biggest net beneficiaries of the Empire State’s losses—which can be traced largely to the New York City metropolitan region.

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Table 7a: Migratory Flow of Adjusted Gross Income (AGI) for New York Counties Interstate Tax-Filer Migrants Only, 2006-07 County Albany Allegany Bronx Broome Cattaraugus Cayuga Chautauqua Chemung Chenango Clinton Columbia Cortland Delaware Dutchess Erie Essex Franklin Fulton Genesee Greene Hamilton Herkimer Jefferson Kings Lewis Livingston Madison Monroe Montgomery Nassau New York Niagara Oneida Onondaga Ontario Orange Orleans Oswego Otsego Putnam Queens Rensselaer Richmond Rockland St Lawrence Saratoga Schenectady Schoharie Schuyler Seneca Steuben Suffolk Sullivan Tioga Tompkins Ulster Warren Washington Wayne Westchester Wyoming Yates

In from other states… Filers Average AGI 1,946 $45,590 326 $33,141 7,320 $25,688 1,500 $39,364 439 $35,371 346 $33,066 942 $31,814 670 $41,687 293 $33,997 468 $52,825 335 $36,009 242 $36,401 247 $44,668 1,680 $53,529 4,371 $46,518 298 $44,460 276 $34,185 246 $37,911 223 $31,090 207 $36,097 38 $33,579 272 $43,827 2,670 $24,460 18,194 $32,623 178 $29,787 283 $41,276 393 $46,204 4,270 $48,478 240 $30,479 4,641 $54,261 35,897 $72,726 938 $36,588 1,124 $38,136 2,904 $53,170 588 $64,391 2,893 $51,090 181 $32,177 560 $34,632 377 $48,432 481 $56,260 12,864 $32,055 970 $46,376 2,033 $41,883 1,751 $53,749 699 $38,266 1,837 $59,249 774 $43,088 129 $37,093 128 $32,828 200 $32,645 673 $42,418 5,902 $57,452 426 $35,254 437 $42,080 1,498 $43,242 944 $39,444 440 $61,734 415 $34,027 394 $42,609 5,576 $83,136 145 $32,097 $124.0 $44,750

Out to other states… Filers Average AGI 2,873 $52,331 388 $34,951 13,109 $35,954 2,048 $40,045 709 $51,790 500 $33,046 1,175 $32,237 774 $41,658 350 $34,523 700 $44,343 545 $43,582 368 $37,663 307 $33,033 2,982 $54,817 7,361 $49,606 326 $39,316 301 $30,824 345 $33,997 375 $35,237 329 $33,368 42 $39,000 367 $38,706 2,983 $25,482 23,242 $45,199 176 $32,205 390 $34,108 512 $41,201 6,955 $55,209 363 $31,105 11,793 $65,138 29,325 $93,264 1,622 $42,160 1,618 $37,547 4,692 $48,781 852 $51,097 4,913 $48,643 282 $30,043 919 $38,614 541 $38,048 933 $63,003 21,941 $44,188 1,340 $43,890 4,581 $61,950 3,110 $68,836 847 $39,481 2,355 $56,893 1,213 $51,234 178 $31,466 140 $33,350 261 $30,467 856 $54,590 14,984 $58,836 763 $38,862 467 $40,347 1,815 $40,243 1,574 $38,598 531 $50,527 440 $32,609 650 $41,734 9,846 $91,942 230 $31,165 135 $38,933

Difference (Out - In) $6,741 $1,810 $10,266 $681 $16,419 ($20) $423 ($29) $526 ($8,482) $7,573 $1,262 ($11,635) $1,288 $3,089 ($5,144) ($3,361) ($3,913) $4,148 ($2,729) $5,421 ($5,121) $1,022 $12,576 $2,418 ($7,168) ($5,002) $6,732 $626 $10,877 $20,538 $5,571 ($589) ($4,389) ($13,294) ($2,447) ($2,134) $3,982 ($10,384) $6,743 $12,133 ($2,486) $20,066 $15,088 $1,214 ($2,355) $8,146 ($5,627) $522 ($2,178) $12,172 $1,384 $3,609 ($1,733) ($2,999) ($846) ($11,207) ($1,417) ($875) $8,806 ($931) ($5,817)

Source: Calculations from Internal Revenue Service data

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Table 7b: Migratory Flow of Adjusted Gross Income (AGI), State Basis Average Adjusted Gross Income (AGI) of Tax-Filer Migrants To and From New York State Alabama Alaska Arizona Arkansas California Colorado Connecticut Delaware Florida Georgia Hawaii Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico North Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming

Filers 754 264 1,708 335 11,478 1,731 7,455 633 16,385 4,065 605 206 3,798 1,199 473 536 808 726 817 3,999 8,253 2,677 1,186 324 1,091 190 302 940 1,062 20,243 419 5,225 97 3,516 613 786 11,240 1,182 1,836 88 1,264 4,930 519 1,266 5,644 1,810 360 1,015 95

To NY Average AGI $38,472 $31,833 $38,958 $32,293 $60,799 $43,437 $71,608 $47,316 $37,885 $40,931 $33,286 $49,209 $62,310 $43,580 $36,780 $34,737 $46,785 $39,123 $40,033 $50,094 $52,986 $47,578 $43,497 $33,346 $49,778 $30,842 $41,212 $35,882 $44,639 $66,227 $35,847 $36,768 $27,680 $48,391 $31,608 $41,076 $47,911 $36,079 $30,999 $30,534 $38,271 $46,804 $39,489 $38,078 $48,044 $45,335 $36,022 $44,862 $32,937

Source: Calculations from Internal Revenue Service data

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Filers 1,042 301 3,426 366 13,632 2,338 9,271 1,053 32,654 9,461 773 214 3,720 1,242 458 575 938 959 925 5,543 7,916 1,794 1,090 422 1,012 250 254 2,000 1,131 27,583 638 13,060 105 3,211 577 1,068 15,349 1,072 4,509 131 1,947 7,163 611 1,334 8,308 2,169 368 841 142

From NY Average AGI $35,475 $28,781 $54,307 $42,863 $66,581 $56,015 $91,067 $50,204 $57,861 $41,901 $40,367 $37,084 $68,173 $44,334 $44,633 $43,850 $42,811 $36,664 $58,198 $47,851 $61,090 $47,005 $55,193 $30,687 $49,483 $41,024 $45,500 $46,382 $59,003 $71,605 $49,447 $46,886 $36,705 $48,048 $36,804 $51,866 $46,224 $47,252 $46,252 $55,847 $43,678 $60,080 $47,260 $45,250 $45,737 $57,823 $36,476 $59,528 $41,810

Difference (From - To) ($2,997) ($3,053) $15,349 $10,571 $5,782 $12,578 $19,459 $2,888 $19,976 $970 $7,081 ($12,125) $5,862 $754 $7,853 $9,113 ($3,973) ($2,458) $18,165 ($2,243) $8,104 ($572) $11,695 ($2,658) ($295) $10,182 $4,288 $10,500 $14,363 $5,378 $13,599 $10,118 $9,024 ($343) $5,196 $10,790 ($1,687) $11,173 $15,252 $25,313 $5,407 $13,276 $7,771 $7,172 ($2,307) $12,488 $453 $14,666 $8,873

As shown in Table 8 on page 16, New York’s total population increased by 2.7 percent between 2000 and 2008, despite the massive continuing migration of New Yorkers to other states in the meantime. The primary reason, as illustrated above in Figure 4: during those eight years, the Empire State has become home to an additional 876,969 foreign immigrants, who made up a growing share of the total state population. Twenty-two percent of New Yorkers were foreign-born as of 2008, up from 17 percent in 1995. The influx of immigrants—who also tend to have higher fertility rates than native-born Americans—has offset large domestic migration losses in and around New York City. Since foreign immigration is a much less significant factor upstate, fewer of those who leave that region for other states are ultimately replaced. New York’s population growth rate was one-third the national average and ranked 41st out of 50 states from 2000 to 2008.

Conclusion What accounts for New York’s chronic inability to attract and retain more Americans than it loses every year? Any attempt to answer that question must begin with New York’s state and local tax burden, perennially ranked among the heaviest in the country.5 Taxes aside, likely explanations differ regionally. Downstate residents face high taxes and housing costs rated among the most “severely unaffordable” in the world.6 Land-use regulations in downstate New York also tend to inhibit growth.7 In upstate New York, housing is relatively inexpensive but even more heavily taxed, and new economic opportunities have been scarce. Weather, on the other hand, seems less compelling as an explanation. After all, while the Sunbelt’s climate has long attracted northerners, cold winters haven’t stopped New Hampshire, Wisconsin and Minnesota from adding population while upstate New York has been shrinking. This much is clear: with New York now facing the most serious fiscal and economic crisis in its modern history, government policies should be aimed at slowing down and ultimately reversing the state’s population drain.

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Wendell Cox is principal of Demographia, an international public policy firm located in the St. Louis metropolitan area. He has served as a visiting professor at the Conservatoire National des Arts et Metiers in Paris since 2002. His principal interests are economics, poverty alleviation, demographics, urban policy and transport. E.J. McMahon is Manhattan Institute senior fellow for tax and budgetary studies and director of the Institute’s Empire Center for New York State Policy.

Endnotes 1 The New York City MSA also includes 12 counties in northern and central New Jersey and one county and northeastern Pennsylvania, which are not included in the New York-focused analysis in this paper. 2 See, for example, Huang, E. T., Kim, J. (2000). “One-Percent Sample Study Report,” U.S. Census Bureau, Statistical Research Division. 3 For further background on how the Census Bureau computes migration for its American Community Survey, see Thibaudeau, Yves (2001), “Can We Ignore the Migration of Income Tax Non-Filers When Benchmarking the American Community Survey’s County Estimates?” U.S. Census Bureau, at www.fcsm.gov/01papers/Thibaudeau.pdf 4 On average, exemptions per return increase with income, according to the IRS Statistics of Income data, which are separate from migration data. 5 New York’s state and local taxes per capita are the nation’s highest, according to the Census Bureau. An alternative, income-adjusted measure developed by the Tax Foundation ranks New York’s 2008 combined tax burden as second heaviest, 21 percent above average. See data at http://taxfoundation.org/taxdata/show/471.html. 6 See Demographia’s 5th Annual International Housing Affordability Survey: 2009. 7 See Demographia’s extensive research on the link between land-use regulations and housing costs at www.demographia.com.

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