A fascinating new poll by Gallup shows that a shockingly high percentage of residents in some states (half of all residents in Illinois and Connecticut!) say they want to move away from their state.
Conversely, only 23% of Montanans and Hawaiians expressed a desire to migrate to another state.
Before delving into the reasons behind residents’ discontent in certain states versus others, here are the bottom and top ten lists, listing states where residents are least and most looking to leave for another state:
Before you go buying stock in companies that lease moving vans or sell bubble wrap, consider that most of these disgruntled residents won’t actually migrate to a new state. Only 6% of respondents said they were either very likely or extremely likely to move within the next year, and many of those won’t actually pull the trigger and act. As of July 2013 (the most recent data available), only around 1.5% of Americans were living in a different state from where they were a year earlier.
Still, more people are moving out of the “undesirable” states than moving in, showing that this disgruntlement data does matter. United Van Lines, a major moving van rental company, recently released data on 2013 migration patterns within the United States, and their list of the top five states for outbound migration looks awfully familiar:
- New Jersey
- New York
- West Virginia
So what is the impetus behind the exodus?
The easiest – and most reported – answer is jobs, and the business-friendliness of the state. Among the Gallup respondents who wanted to leave their state, 31% reported that the reason was because of either work or the unfriendly business climate in their state. States who are not business-friendly should take heed, if they want to stop the bleeding.
Related to business climate is another reason reported by would-be movers: high taxes. This should come at no surprise, taking a quick glance at the list of states people are clamoring to leave. According to Kiplinger, Connecticut has the second highest total taxes in the country, with high income taxes (top rate of 6.7%), high sales tax (topping out at 7%) and high property tax rates and gasoline tax rates. Also high on the list of top-taxed states are New Jersey (#3), New York (#4), Rhode Island (#6) and Illinois (#10)… is it any surprise that four of these five are on the top five outbound moving list, and all of these are on the top ten list for residents' desire to leave?
Some higher-tax states have responded by trying force or scare their residents from trying to leave, a tactic not likely to endear them to their residents and encourage loyalty. From Massachusetts using E-ZPass data to trigger audits of outbound residents, to Maryland requiring extra withholding tax collections from out-of-state home sellers, to Minnesota trying to change residency requirement to only 60 days/year, high-tax states are not letting residents leave quietly.
While strong private sector job growth and low tax rates certainly help, and are clearly correlated to growth, they cannot tell the whole story. Climate matters; Hawaii has high taxes (fifth highest in the country in fact), but it is so naturally gorgeous that no one wants to leave (which also helps their unemployment rate, which sits at a healthy 4.4%).
The culture of a state obviously matters too, despite being more difficult to quantify and compare. Look at Maine; most citizens are content to stay, despite the state’s high tax rates (seventh highest nationwide), troubling unemployment at 6.7%, and a cold, harsh climate eight months of the year.
Still, states like Texas are clearly making out well. The climate is pleasantly warm, the government is business-friendly and boasts a lower-than-average unemployment rate and booming economies in cities like Austin. Texas charges no income tax, and only 24% of residents are interested in leaving. Texas is doing something right, and other states may want to pause and pay attention if they want to retain their residents.