Utah, rising.

Photographer: George Frey/Bloomberg

Jobs Keep Going West

Justin Fox is a Bloomberg View columnist. He was the editorial director of Harvard Business Review and wrote for Time, Fortune and American Banker. He is the author of “The Myth of the Rational Market.”
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For generations now, U.S. population and economic activity have been moving outward -- away from the cities and toward the suburbs, and away from the Northeast and the Rust Belt and toward the South and the West.

As someone who has followed the opposite path, from a California suburb to Manhattan, I always get excited when I see evidence that others are heading back to the cities and to the Northeast. And there has been some recent evidence -- house prices have been rising faster in cities than in suburbs; a few Northeastern cities have undergone big revivals; Southern and Western metropolitan areas were among the hardest hit in the recent real-estate bust.

To be honest, though, there's still even more evidence pointing toward continued outward movement. However much I and other migrants to big old cities might like to think of ourselves as trendsetters, it's limited trend. Here's real-estate economist Jed Kolko in a recent post on the purported urban revival:

The share of Americans living in urban neighborhoods dropped by 7%, from 21.7% in 2000 to 20.1% in 2014. Even looking at only the densest urban neighborhoods where about one-third of the urban population lives, the share of Americans living in these neighborhoods fell by 5%, from 7.4% in 2000 to 7.0% in 2014. ... Headlines about educated young adults flocking to Brooklyn and San Francisco aren’t wrong -- but they are far from the whole story and are unrepresentative of broader trends. Other demographic groups are suburbanizing faster than the young and rich are piling in to cities.

As for that shift to the South and West, I decided to look for it in the big pile of state jobs data that I gathered for a column last week. First, the long-run view. Here are the states with the fastest job growth since 1990, when the state employment data series begins:

Five of these states border Canada, so this isn't what you could call an exclusively Southern phenomenon. It definitely is Western, with only one of the top 15 (Florida) east of the Mississippi. Still, some of these states were growing from a very small base. Alaska, the Dakotas, Montana and Wyoming remain among the 10 states with the fewest workers on nonfarm payrolls, even after all those gains. When you look at the states that added the most jobs, the list gets a bit more Southern -- although it also includes two big Northeastern states:

Finally, here are the states (I'm including the District of Columbia in all these tabulations) with the slowest percentage growth in payroll employment since 1990.

Overall, then, the evidence mostly fits the narrative of Northeastern and Rust Belt decline and Southern and Western ascent.

But hey, maybe things have changed lately! So I redid the charts for a much shorter time period -- since January 2010, near the beginning of the current economic recovery. Here are the states with the fastest job growth:

OK, still mostly Western. Plus a few Southern states and, remarkably, long-struggling Michigan. Next, the leaders in absolute job gains:

There's more geographical diversity here. Several big Northeastern and Rust Belt states have added lots of jobs. But California, Texas and Florida have been leading the way, adding almost as many jobs as the next 12 states combined (5 million to 5.3 million). Finally, here are the states with the slowest percentage growth:

The two slowest-growing states happen to be the country's two biggest coal-mining states, Wyoming and West Virginia. After that it's a pretty motley crew: some South, some North, some East, some West.

There are lots of interesting stories behind individual states' post-2010 numbers: California rebounding from a bad slump and Michigan from a terrible one; Texas plowing onward despite the oil industry's struggles; New Jersey and Connecticut struggling as New York (at least downstate New York) prospers; different Southern states experiencing very different economic conditions; Utah continuing to boom. The overall picture is a bit more muddled than the one painted by longer-run data. But it doesn't seem to have radically changed. The West, and parts of the South, are still where most of the job growth is. U.S. population and economic activity have not stopped moving outward.

  1. Population growth and job growth tend to be pretty closely related, which is why I to some extent lump them together here. They're not exactly the same, though, of course: States that attract lots of retirees may see faster population growth than job growth, and since 2000 adult population growth in the U.S. has outpaced job growth.

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

To contact the author of this story:
Justin Fox at justinfox@bloomberg.net

To contact the editor responsible for this story:
Zara Kessler at zkessler@bloomberg.net