A man walks through Wall Street in Manhattan, New York, where the epidemic has caused more young people to move out of the metropolis.
The epidemic has spurred population movements, intensifying the nation’s change of residence and lifestyle; young people are moving out of cities earlier, fewer new immigrants are settling in big cities and older people are accelerating their retirement; the suburbs have been the big winners of this domestic migration and urban-rural structural shift, ending a decade-long trend of big cities.
Before the Census Bureau’s American Community Survey releases demographic data this fall covering all of last year, the Wall Street Journal analyzed the 2020 National Postal Service “permanent change of address” data and saw millions of domestic migrations, validating the demographic shift during the epidemic.
While households increased in the South, particularly in Florida and Texas, the opposite was true in the Northeast. Large cities including New York, Chicago, San Francisco and Boston all saw hundreds of thousands more people move out than residents moving in, and net household loss due to migration expanded by 71 percent in 2020 compared to the previous year; higher-income communities moved out more significantly than lower-income communities. New York City saw more net relocations in one year last year than in the previous two years combined.
People who can afford to work anywhere are breaking free and relocating to less dense, affordable areas in search of more living space; many businesses are open to working remotely in the wake of the epidemic, companies looking to reduce overhead and retain talent are setting up offices in the suburbs, and developers are adding fitness, dining and other amenities in the suburbs to keep recreation localized.
Most of the population outflow has gone to the suburbs of the metropolitan area; the number of net new households moving into the suburbs last year was 43 percent higher than the year before; the number of households in Dallas, Indianapolis, Nashville, Tennessee, and Charlotte, North Carolina, has surged.
Stephan Whitaker, a policy economist at the Federal Reserve Bank of Cleveland, used credit record data to analyze urban mobility patterns and found that in earlier years, net out-migration from urban neighborhoods was greater in communities with below-median median incomes; however, in 2020, the situation reversed, with the largest migration losses occurring in affluent communities with above-median incomes; more epidemic deaths and more remote jobs Metropolitan areas with more deaths from the epidemic and more remote jobs will experience even greater outflows.
As a result, annual property tax revenues in the nation’s largest cities will plummet by billions of dollars and rents will fall by double digits; all large cities must prepare for post-epidemic levels of public transportation and other spending that drive urban economic development to be less than they once were.