In the United States, mass migration of population from large cities to the south… Southern economy ‘green light’

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Generation M, highly educated and with young children, moves to Phoenix-Jansonville, etc.
WP “Problems with networking in big cities are eliminated by promoting work from home”

Map showing the immigrant population in the United States in 2021-2022. The northeastern region, where New York and Washington DC are located, and western California, where Silicon Valley is located, are full of red marks indicating a net decrease in population. On the other hand, southern cities marked in blue indicate a net increase in population. Source: U.S. Census Bureau website

During the novel coronavirus infection (Corona 19) pandemic, many people in the United States are leaving big cities, raising concerns about an economic downturn, but on the other hand, ‘green lights’ are being observed, such as second-tier areas gaining vitality, according to Washington. The Post (WP) reported. As the combination of working from home and working at the office becomes the ‘new normal’, the low growth phenomenon that was a concern can be compensated for by this.

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On the 13th (local time), this media outlet analyzed, “Traditional economic theory holds that the exodus of workers and capital from large cities can lead to low growth for several years due to increased production costs, but this concept is being reconsidered on a large scale following the pandemic.” did.

According to the U.S. Census Bureau’s announcement in May last year, the population of the southern region, which was previously considered a ‘resort area’, increased by more than 1.28 million in 2022. Nine of the 15 fastest-growing cities in the U.S. are also in this region. On the other hand, in the same year, about 460,000 people in the northeastern region, where the largest cities in the United States, including New York, Washington DC, and Boston, moved to other regions of the United States.

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As people move out of New York, which led the ‘skyscraper era’, concerns are rising about an economic downturn, but WP said that due to the activation of remote work after the pandemic, people living in other regions are still working with companies in New York and San Francisco. He pointed out that networking was going smoothly. In particular, WP noted that people who moved from New York and San Francisco to relatively low-cost cities such as Phoenix and Jacksonville were mainly millennials with young children and ‘highly educated’ college graduates.

The media also explained that even before the pandemic, people were already moving south due to housing shortages in big cities. The fact that millennials are now able to use some of the expensive rent and mortgage interest they used to pay to live in big cities for business and investment was also cited as grounds for a positive outlook.

A view of Phoenix City Hall on February 19th.  Phoenix City websiteA view of Phoenix City Hall on February 19th. Phoenix City website

It was also seen as an advantage that the economies of cities receiving large influxes could be revitalized. In fact, Phoenix and San Antonio, which were considered second-tier cities, have entered the top 10 cities in the United States, and Jacksonville and Charlotte are also called ’emerging cities’ as they are approaching 1 million people.

Some say that this demographic change is already changing industries in the southern region. In the 2020s, IT companies such as Tesla, Oracle, Hewlett-Packard, and Dropbox also moved their headquarters from Silicon Valley, California to the southern state of Texas.

In addition, as government and private investment in semiconductors and green energy increases, more capital is flowing into the South, WP added. Benjamin Glassner, an economist at the Economic Innovation Group (EIG), a public policy organization in the United States, explained, “As people move, there is a business boom in the Southern Sunbelt (the emerging industrial zone in the southeast stretching from Texas to North Carolina).”

However, WP explained that regions such as Florida, where the inflow of the population has increased, are beginning to experience the same problems as New York and San Francisco, such as the housing crisis and rising rents. There are also serious concerns that New York’s commercial real estate downturn could become a crisis that will shake not only the United States but also banks around the world.

Source: Donga

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