The Economist - USA (2021-12-18)

The Economist December 18th 2021 21

United States

Internalmigration

Movers and shakers

A

fter thesecond  world  war,  Ameri­
cans took their new cars on their new
highways  and  decamped  for  the  suburbs,
changing American life forever. Today, the
internet and remote work presage a similar
transformation.  A  two­hour  commute  a
couple of days a week may be worthwhile,
if  it  allows  a  bigger  house  and  smaller
mortgage  payment.  So  might  a  move
across the country, if one rarely has to tra­
vel  to  company  headquarters.  Adam  Ozi­
mek  of  UpWork,  a  freelancing  platform,
has  estimated  that  some  14m­23m  Ameri­
cans may up sticks because of the rise of re­
mote working, which amounts to between
9% and 13% of today’s workforce. 
“People  are  asking  deep  questions
about  how  and  where  they  want  to  live,”
says  Richard  Florida  of  the  University  of
Toronto,  who  observes  a  “great  un­
mooring”  in  Americans’  thinking  about
where  they  live.  Chris  Proctor,  who  works
for  John  Burns  Real  Estate  Consulting,
which  advises  homebuilders,  says  this  is
“unlike  anything  we’ve  seen  in  decades.
The  closest  comparison  is  the  suburbani­
sation we saw in the 1950s”. 

Migration is following two trends, both

of  which  existed  before  the  pandemic.

First,  people  have  been  leaving  large,

dense,  expensive  urban  cores  for  smaller,

less­dense  cities  and  suburbs.  Second,

people  and  companies  have  been  moving

to  warm,  low­tax  states  in  the  South  and

south­west (see chart 1 on next page).

Take the flight from cities first. Stephan

Whitaker  at  the  Federal  Reserve  Bank  of

Cleveland  uses  credit  data  to  show  how

hard urban neighbourhoods were hit dur­

ing  the  pandemic.  More  people  left  and

fewer people chose to move into large cit­

ies, such as New York, Los Angeles and Chi­

cago.  Late  2020  saw  a  peak  of  net  out­mi­

gration  from  urban  neighbourhoods  of

around  75,000;  in  the  second  quarter  of

2021  it  averaged  54,000  per  month,  more

than double pre­pandemic levels.

Mr Whitaker estimates that from March

2020 to March 2021 around 600,000 people

moved from large, high­cost metro areas to

mid­size  cities  (meaning  those  with  be­

tween 500,000 and 2m people), and more

than  740,000  moved  to  rural  areas,  small

towns  and  cities  with  populations  below

500,000—an increase in both instances of

13.5% from pre­pandemic levels. New York

and San Francisco saw the largest jump in

the  share  of  people  leaving.  In  recent

months,  young  renters  have  started  re­

turning  to  some  cities  while  middle­aged

people  are  continuing  to  flock  to  the  sub­

urbs to buy homes. 

Cost and covid­19 are not the only con­

siderations.  Many  cities  have  seen  an  up­

tick  in  crime,  homelessness  and  business

closures  just  as  they  are  experimenting

with  criminal­justice  reform  and  propos­

ing tax increases. Edward Glaeser, a profes­

sor at Harvard and co­author of “Survival of

the City”, says he worries about “the under­

standable  urge  for  progressive  action  in

cities running into the buzz­saw of height­

ened  geographic  mobility”.  But  he  warns

that if cities target the rich and businesses

with  taxes  “and  fail  to  offer  basic  services

like public safety, then something that was

a modest economic disruption could turn

into something much more severe”. 

Towns  and  suburbs  near  large  cities

have been the biggest magnets. According

to  The Economist’s  crunching  of  data  from

the  United  States  Postal  Service,  the  three

zip codes with the most changes of address

for  new  arrivals  were  in  suburbs  and  ex­

urbs outside Houston and Austin in Texas

DALLAS
The covid reshuffle of the past two years will change America for longer

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