An analysis of the accelerating outbound migration across the border to the Badger State
The No. 1 U.S. state for outbound migration in 2017 was Illinois, moving up from No. 2 in the previous year. And Wisconsin is one of the top beneficiaries of this migration pattern.
There were 534,527 moves in 2017 for Illinois — 339,435 outbound moves (63.5% of the total) and 195,092 inbound moves (36.5% of the total), for a -27.0% net outflow. That put the Prairie State far ahead of No. 2 New York at -22.7% net outflow and No. 3 New Jersey at -19.3%. This is based on a recent analysis of the U.S. Census Bureau’s annual “State-to-State Migration Flows” database for 2017 that I did for a report titled “Top 10 Inbound vs. Top 10 Outbound U.S. States in 2017: How Do They Compare on a Variety of Tax Burden, Business Climate, Fiscal Health and Economic Measures?”
When compared on a variety of 10 measures of tax burdens for individuals and businesses, business climate, state fiscal health, labor market robustness and economic growth, the migration patterns of U.S. households (and businesses) followed some predictable patterns.
There is strong empirical evidence that Americans “vote with their feet” and are moving from high-tax states that are fiscally unhealthy, economically stagnant and unfriendly toward businesses to fiscally sound states that are more economically vibrant, dynamic and business-friendly, with lower tax and regulatory burdens and that offer more economic and job opportunities.
No surprise there. And no surprise that Illinois led the country in outbound migration in 2017 given its poor rankings on most of the 10 measures of business friendliness, tax burden and economic dynamism. In addition, the Mercatus Center ranks Illinois No. 50 for state fiscal condition, mostly due to its large ($446 billion) and growing unfunded pension liabilities.
Where are the outbound households and businesses from the Land of Lincoln moving? One increasingly popular destination is across the northern border into Wisconsin.
In 2017, nearly 27,000 people left Illinois for Wisconsin, compared with fewer than 13,000 moving in the opposite direction — for a net inflow to Wisconsin of nearly 15,000 people. That followed a record net inflow of nearly 16,000 in 2016, 11,500 in 2015 and 15,370 in 2014 (Figure 1).
There has been a net outflow from Illinois to Wisconsin of more than 116,000 residents between 2006 and 2017 (Figure 2). About half of that net gain has taken place in the past four years at an average net gain for Wisconsin of nearly 40 residents moving from Illinois every day between 2014 and 2017.