STUMP » Articles » Americans on the Move: Driven Out By Costs » 22 July 2015, 09:26

Where Stu & MP spout off about everything.

Americans on the Move: Driven Out By Costs  

by

22 July 2015, 09:26

It looks like this week’s theme is moving and escape.

In an earlier post, I looked at outmigration from states, which had this graphic:

The problem is that that is a yes/no one-year measure, and it’s difficult to see the significant moves.

Bloomberg covers that this morning:

New York City, Los Angeles, Honolulu: They’re all places you would think would be popular destinations for Americans. So it might come as a surprise that these are among the cities U.S. residents are fleeing in droves.

The map below shows the 20 metropolitan areas that lost the greatest share of local people to other parts of the country between July 2013 and July 2014, according to a Bloomberg News analysis of U.S. Census Bureau data. The New York City area ranked 2nd, losing about a net 163,000 U.S. residents, closely followed by a couple surrounding suburbs in Connecticut. Honolulu ranked fourth and Los Angeles ranked 14th. The Bloomberg calculations looked at the 100 most populous U.S. metropolitan areas.

Here is their graphic:

One thing to note is that even as U.S. residents left these places, they did not necessarily have population reductions.

Let me get all mathy for a second, here’s the equation:

POPULATION CHANGE = IMMIGRATIONOUTMIGRATION + BIRTHSDEATHS

The article covers some of these issues:

Interestingly, these are also the cities with some of the highest net inflows of people from outside the country. That gives many of these cities a steadily growing population, despite the net exodus of people moving within the U.S.

So what’s going on here? Michael Stoll, a professor of public policy and urban planning at the University of California Los Angeles, has an idea. Soaring home prices are pushing local residents out and scaring away potential new ones from other parts of the country, he said. (Everyone knows how unaffordable the Manhattan area has become.)

And as Americans leave, people from abroad move in to these bustling cities to fill the vacant low-skilled jobs. They are able to do so by living in what Stoll calls “creative housing arrangements” in which they pack six to eight individuals, or two to four families, into one apartment or home. It’s an arrangement that most Americans just aren’t willing to pursue, and even many immigrants decide it’s not for them as time goes by, he said.

In addition, not all of Manhattan is equally expensive, and most especially not all of New York City is equally expensive.

A PERSONAL DIGRESSION ON LIVING IN NEW YORK

I used to live in Manhattan (3 years) and then Queens (8 years). In both places I lived, there was extremes of living conditions within just a couple blocks of each other. I was pushed out of Manhattan as I did not have a rent-controlled apartment, and the NYU trust funders were bidding up East Village prices. The old folks in my 6-story walkup did not get pushed out by rents that were $1400/month when I left in 1999.

In Queens, I lived in a 2 bedroom co-op apartment, in a co-op of 435 units (I was on the co-op board as Secretary for 3 years, so I remember the count). This co-op was surrounded by houses mostly owned by orthodox Jews (there were a couple synagogues within walking distance, which is a necessity on Sabbath). The houses were much more expensive than our apartments, and we had rental units within the co-op itself (the co-op had a long history, including the involvement of Donald Trump’s dad, but that’s not a story for now.)

We were at the southeastern end of Main Street in Flushing, the northwestern end being in Koreatown, unsurprisingly chock-full of Korean (and other) immigrants. Koreatown was much cheaper.

My point is that lots of these places, through extremely dense residential areas, have a mix of low-cost and high-cost living. There’s not much in the middle. I mean, my 2-bedroom apartment was in the middle, but I moved out to Westchester when the youngest of our 3 kids was 1 year old. It was the matter of an opportunity, but we were going to be moving at some point.

When the kids are small, you can stick them in a drawer, but as they get larger (and smellier), one wants a bit more room.

In any case, many of these cities are, and have long been, places of transience. New York City is notorious for this — few people living there are actually from there. You’re expected to move on somewhere else if you grow up there.

Here was something interesting:

This explains why the majority of metropolitan areas in Florida and Texas, as well as west-coast cities like Portland, had an influx of people.

El Paso, Texas, the city that residents fled from at the fastest pace, also saw a surprisingly small number of foreigners settling in given how close it is to Mexico.

I wonder where those people went. Of course, they lost “only” 8.5K people, which is large for such a small place (it would be a rounding error for NYC).

PUTTING CONTEXT TO THE NUMBERS

The problem, of course, is that while there is some context to the numbers, it’s hard to gauge what the real magnitude of these changes are. So -0.45% change in U.S. residents on net? Is it all that bad?

One year changes tend to be too small to detect.

I’m going to be extremely simple-minded and extrapolate these percentage changes to a decade, treating this like a compound annual growth rate. To be sure, I bet there’s lots of fluctuations, but let me do just a few points.

Assuming a constant annual percentage rate of change, you would see an outmigration effect in a decade:

  • Chicago-Naperville-Elgin: 6.7% decrease
  • El Paso: 9.7% decrease
  • New York-Newark-Jersey City: 7.8% decrease
  • Detriut-Warren-Dearborn: 4.6% decrease

Now, mind you, this is extrapolating from a one-year trend, and I’d really like to see longer periods of time.

In addition, this is just net migration of U.S. residents. This does not include the effects of immigration, deaths, and births.

The crude death rate for the U.S. is 0.8%, which is on a par with the one-year New York outmigration.

The crude birth rate for the U.S. is 1.3%, which is higher than any of these net outmigration numbers.

I’m not going to even try to figure out immigration rates right now, because, even though like births and deaths they are uneven across the U.S., the locations of immigration are much more skewed than births/deaths.

So yes, I think the theory that many Americans leave urban areas due to costs is plausible, but also because it’s so much nicer living in suburbia.

For now.


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