Young professionals with sizeable incomes are moving to places more favorable to their lifestyles and businesses, according to new research conducted by SmartAsset, an investment advisor group.
SmartAsset’s September survey reviewed the movement of so-called “rich young professionals”—those younger than 35 earning an adjusted gross income of at least $100,000 a year.
The survey followed the inflow and outflow of those in that category through all 50 states and the District of Columbia, using Internal Revenue Service data to compare tax returns from 2019 and 2020.
It appears that more conservative states, with less taxes, lower crime, higher quality of life, and lower businesses expenses are winning out over blue states like New York and California.
New York is the state that most young professionals are eager to flee, with a net loss of 15,788, and has the highest number in that subset leaving by a significant margin.
The second-worse performing state is California, with a net outflow of 7,960 departures of wealthy young professionals.
SmartAsset looked at the top seven states where wealthy millennials are moving to.
Texas and Florida are those most most appealing to young professionals, and both have no state income tax, both are more affordable and have the space for young families, and both are business friendly.
The two states had a net inflow of 3,823 and 3,411, respectively, of individuals under 35 making $100,000-plus last month.
Another beneficiary is Washington, with a net inflow of 2,800 wealthy young professionals, and considered by some to be the most affordable state for millennials.
North Carolina, Arizona, Connecticut, and Tennessee round out the seven states with the most gains.
Illinois, Massachusetts, Louisiana, North Dakota, and Virginia round out the seven with the most losses.
The District of Columbia also witnessed an outflow of inhabitants.
Red States Triumph With Younger Professionals
“Red states are winning the war for talent in an ever-tightening labor market,” said Andrew Crapuchettes, chief executive officer of RedBalloon.work to The Epoch Times.
“Blue states like California and New York are destroying their future by pushing out young professionals who want to build successful careers and businesses.”
“The lack of income tax in states like Florida and Texas is a key driver, but it is also just the tip of the iceberg. ‘Woke’ mandates during the pandemic and [afterward] have worn down the employee and entrepreneur confidence that they can thrive in blue states,” Crapuchettes continued.
California and New York both have a reputation for being expensive in comparision, said Susannah Snider, managing editor of financial education at SmartAsset, to CNBC.
Texas and Florida “also have a reputation for affordability,” said Snider, but notes that “housing costs and other expenses will vary within a particular state.”
The normalization of working at home has played a role in why professionally successful young people are fleeing the older coastal hubs.
The fact that many are no longer required to work at offices in blue states has led to a decentralization of employees, which overall favors red states.
“As offices closed in 2020 and companies switched to remote work, young professionals may have had more flexibility in choosing where to live and could move based on factors unrelated to workplace proximity,” Snider said.