Economists' Outlook

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Smaller Metro Areas are Gaining Population During the Pandemic

People are changing jobs every 4 years on average, according to the recent release from the U.S. Bureau of Labor Statistics.1 With telecommuting likely to continue long after the pandemic, employee tenure may be impacted since many people will be able to work from anywhere. Meanwhile, one of the main reasons people consider moving is for a new job. In recent months, there has been significant speculation about how the pandemic will change where Americans want to live, since they can work remotely. Fresh new data from LinkedIn shows that smaller areas are gaining population instead of popular big cities. 

LinkedIn releases the LinkedIn Workforce Report every month.  In addition to employment trends in the U.S. workforce, this report provides insights into migration trends in 20 of the largest U.S. metro areas.2 After comparing inflows and outflows for the period April to August 2020, LinkedIn identified the following metro areas to experience the highest gains and declines in net arrivals compared to a year earlier:

Table: Migration Trends: Smaller Cities Gain Ground

While Jacksonville is taking off in technology, many people decide to move to the area. With an unemployment rate lower than nationwide, affordability seems to be another reason that makes Jacksonville one of the areas with the highest gains in net arrivals. Specifically, 1 of 2 renters can afford to buy the typical home in the area. In addition, Salt Lake City, UT, and Sacramento, CA are two areas where many people relocate from pricier areas in northern California. After taking a closer look at the outflows for the San Francisco Bay area, Sacramento was one of the top 5 destinations during the pandemic. In the meantime, among all metro areas, Salt Lake City ranked as the 15th metro area with the lowest unemployment rate (5.3%).  As for Milwaukee and Kansas City, both areas are located in states with fewer COVID restrictions. Based on Google COVID-19 Mobility reports, more people visit grocery and pharmacy stores, parks, and transit stations in these areas than they did pre-pandemic. Consequently, people relocate to these areas since these local economies are recovering faster, let alone have better affordability and job markets than nationwide.

In contrast, people decided to leave New York, NY, and San Francisco, CA during the pandemic. Compared to a year earlier, in these two areas, net arrivals dropped more than 20%. A high cost of living is the main reason that people decided to move from these areas since they can work remotely. According to LinkedIn, the following metro areas are more attractive to New Yorkers and San Franciscans during the pandemic:

Bar chart: Cities People Are Moving to from New York
Bar chart: Cities People Are Moving to from the San Francisco Bay Area

Overall, we are beginning to see signs of the COVID effect on migration. For instance, the nation’s pricey tech hubs have begun to lose some of their residents with many people looking for smaller and more affordable areas.


1 U.S. Bureau of Labor Statistics, Employee Tenure January 2020
https://www.bls.gov/news.release/pdf/tenure.Pdf

2 To develop the list of cities that gained the most workers, LinkedIn analyzed the migration of its members in and out of 50 of the largest U.S. cities (in terms of LinkedIn membership) for the past 12 months.

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