SmartAsset’s fifth annual study on where millennials are moving reveals the cities and states where net migration is the highest. What is significant about this data is that “millennials have been the largest generation in the workforce since 2016.”
Key Findings (directly quoted):
- Moving West and South. Six out of the top 10 cities in the study are located in Western U.S., with the other four in the South. Colorado and Texas each have two cities in the top 10 – Denver and Colorado Springs in the Centennial State, and Austin and Frisco in the Lone Star State.
- Leaving the biggest cities. Millennials are flowing out most from the largest city in the country. New York City lost a net of almost 40,000 from this generational group in 2019. The second-largest outflow came from Chicago, with a net decrease of more than 11,000 millennials. Other big cities with net migration losses, placing at the bottom of our study, include Los Angeles, San Diego, Boston and Miami.
- States with no income tax. Five of the top 10 cities where millennials are moving have no state income tax on salaries and wages: Seattle, Washington; Austin, Texas; Frisco, Texas; Henderson, Nevada and Cape Coral, Florida.
What are the implications for a shifting workforce? Here a few possibilities.
Attitudes about compensation – PwC reports that younger workers are more likely to be on the move and more likely to accept smaller salary increases if given the option to go remote permanently than the two generations before them. Nearly half of Gen Z (45%) and millennial (47%) employees revealed they are willing to give up 10% or more of their future earnings in exchange for the option to work virtually from almost anywhere.
Professional advancement inequalities – Millennials who do move may find they’re sacrificing advancements. “Professional advancement in a distributed company could look very different, and distant employees could find themselves at a disadvantage relative to their office-bound colleagues” according to Teresa Lee in a Los Angeles Times article on working from anywhere. “There’s decreased visibility, so you won’t be top of mind when it comes to promotions and these sorts of things.”
Workforce decentralization – Ken Morris of Morrsi Southeast Group suggests millennials are moving to places with access to yards, parks, and nearby good schools where suburban properties are more affordable. The challenge he writes “is determining whether this movement from the cities is transitory or marks a lasting decentralization of the workforce. If it’s the latter, moving to a hub-and-spoke living and working environment could make suburban offices a far more valuable commodity.”
New opportunity for businesses for competitive advantage through digital transformation – CEO and co-founder of Slack, Stewart Butterfield states that the new choices employees are making about where they want to live while at the same time creating new expectations about flexibility and working conditions provide an opportunity for competitive advantage for businesses that can drive engagement, be agile, and empower teamwork through digital transformation.