New data show six Southern states now contribute more to GDP than the entire Northeast
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Bloomberg reports, “For the first time, six fast-growing states in the South — Florida, Texas, Georgia, the Carolinas and Tennessee — are contributing more to the national GDP than the Northeast, with its Washington-New York-Boston corridor.” This initially became true in 2021, but the gap between these states and the Northeast has expanded over the past year.
Today, those six Southern states contribute 1.4 percentage points more to the GDP than the entire Northeast.
Among the main reasons for this is the massive migration from major cities in the Northeast, such as New York and Washington, D.C., to the South. Internal Revenue Service data show that interstate migration “helped steer about $100 billion in new income to the Southeast in 2020 and 2021 alone, while the Northeast bled out about $60 billion.”
This is consistent with data published yearly by the National Association of Realtors, which show that 5 out of the 10 states with the most out-migration in 2022 were in the Northeast, with New York losing almost 300,000 people last year. On the other hand, the top six states with the most in-migration were all in the South: Florida, Texas, the Carolinas, Tennessee, and Georgia.
But it’s not just individuals who are fleeing for red states in the South. Bloomberg reports that, according to census data, “Corporations are also flocking there, with a record number of firms moving south after the pandemic.”
Bloomberg partly attributes the significant migration to the South to “the warmer weather, lower taxes, looser regulation and cheaper housing.” The data back this up. However, it says there is an added factor that is hard to quantify, as it is about the atmosphere in the South that makes individuals and businesses alike feel wanted.
“We now have more employees in Texas than New York state. It shouldn’t have been that way,” said JPMorgan Chase CEO Jamie Dimon.
For those who have been tracking population shifts over time, this should not come as too much of a surprise. However, if one had only been listening to the corporate press over the past few years, one could easily be shocked. After all, news coverage on Florida, Texas, and Tennessee has painted them as dystopian hotbeds of bigotry and authoritarianism where students aren’t allowed to read books and minorities must be in constant fear.
The issue, of course, is that caricature couldn’t be further from the truth. We know this because of the facts. But we also know it because people ultimately vote with their feet. There is a reason why so many people are moving to these red states despite the slanted news coverage. Similarly, despite the terrible things some people say about the U.S., there is a reason millions of people would literally risk death to come here. Rhetoric is cheap. People act based on conditions in the real world.
It is a great thing that a region of the country historically not known to be an economic powerhouse has now turned the tide. Maybe more liberals will now refrain from making snarky comments about how their states are the ones actually contributing and instead focus on fixing the problems that incentivized so many people to flee.
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