Americans tend to vote with their feet. Moving from one state to the next depends on which state offers them the best opportunity to thrive. Tax structures, regulations, and business climates – all handed down by their local elected officials – directly impact their decision-making process. After the US Census Bureau released its latest net domestic migration report last month, it’s become clear that elected officials from the low tax states made the right call.
Texas led the nation with the highest net in-migration from July 2023 to July 2024, gaining over 85,000 people. It was followed by North Carolina, South Carolina, Florida, and Tennessee. Together these states added nearly 350,000 new residents. What do they have in common? Low taxes, fewer burdensome regulations, and policies that foster economic opportunity. Those attributes attract individuals and businesses seeking a free enterprise environment where economic opportunity may thrive.
In stark contrast, states with policies that stifle competition and impose high costs on businesses continue to lose residents. For the fourth consecutive year, California experienced the largest net outflow, with nearly a quarter of a million people leaving during the 12-month period. In the last five years, the Golden State has lost more than 1.4 million people on net. That loss represents not only a dwindling population but a profound economic loss. Taxpayers, businesses, and jobs leaving the state compound the fiscal difficulties California is already juggling. In 2024, this contributed to a $47 billion budget deficit, forcing policymakers to deplete their rainy-day fund and raise taxes.