Why people are moving to some states and not others

Global Business

California and New York are losing large numbers of residents. As many arrive in these transient states to seek their fortunes, others are heading out because they’re fed up of the cost of living.

CGTN’s Phil Lavelle reports.

According to research published by the Wall Street Journal, the two states have jointly lost around two million people in just over a decade. This, as Texas gained 1.4 million new residents and Florida saw 850,000 new people set up home there.

Cities seeing booms include Denver, Colorado and Nashville, Tennessee.

Professor of Government at the University of Texas Nathan Jensen sums up why so many people are moving to Austin: “It’s the jobs and quality of life.”

“I think the selling point is often cities. So to say ‘Nashville’ or ‘Memphis’ is much more attractive to people, like ‘Austin,’ vs ‘Texas.’ I think a lot of these cities have unique environments,” Jensen said.

“Florida is different to Miami so I think many of these cities have found out ways to make themselves attractive. And the selling point after that is it’s inexpensive, it’s interesting, there’s a great airport. There’s all these things that you want.”

A big concern a lot of companies have is where to get their talent. Many may entertain the idea of leaving Silicon Valley for a smaller city, but fear they could miss out on key staff.

Bill Alderson, CEO of cybersecurity specialist firm HopZero, isn’t worried though.

Alderson started his business in Silicon Valley, but he found that the cost of operating there was getting ridiculous.

“In California, it’s exorbitantly expensive for families to live and here it’s a lot of homes and an ability to live and have a good quality of life that’s important to us,” Alderson said. “That’s why we chose Austin, Texas.”

More on these ‘state swaps’

In fact, he says there was very little pushback from employees when the move happened and points to the city’s universities as one reason that many companies are moving there.

“We have all of these great universities, right here within what, two hours or so? There’s no shortage of talent,” he said.

Sumat Lam is one of those talented workers. He works for a major tech company based in Austin. He had to give the move from California’s San Francisco Bay Area some serious thought.

“I was hesitant at first. I knew I wanted to be in tech initially, and so my thought process was: Why would I want to leave the center of tech right now? But I talked to friends who knew Austin, one from Austin, and they really had very deep insights into why I would like Austin and so through those conversations, I was able to make decisions like ‘Let’s give Austin a shot,'” he said.

“Living my whole life in the Bay Area, I thought that was normal and then when Austin came up on my radar, I started to do a little more research, I started talking to my friends from Texas, from Austin, And it was quite a surprise for me to see how different just rent was here. And that was really one of the big factors for me – especially coming out of college – to be able to have a higher standard of living.”

There’s no doubt that money goes further in Austin.

Kenn Renner shows us around a home that costs $350,000. It’s a three bedroom detached house with several bathrooms, a game room, media room and study. He tells CGTN that the same home would cost around $2 million if it were in New York.

Ironically, he’s Californian himself. And he goes on regular trips back to the Golden State to try to convince others to make the switch.

“I’ve become an evangelist for moving people from California to Texas because of the value that you get here,” he said, adding: “When they get out here, it’s like a kid in a candy store. There’s about 250 people a day moving to the Austin area from other parts of the country, a lot of that from California.”

Of course, the downside is that as these cities grow, they’ll start to experience some of the same problems that prompted their new residents to leave their old homes.

“I think the worry here is that we’re attracting high-end companies. And these companies are coming in and generating high-end jobs; the Googles, the Apples, and I think it’s for the people who are making minimum wage, or even making middle income that we’re seeing property values go up dramatically, we’re seeing no economic development directly to them,” Jensen said.

“And there is a worry that some of these states are giving up so much in tax incentives that it’s harder to provide public schooling. So there is a worry, there’s a tension for those in the lower income but also middle class as well.”