Gone to Texas
This commentary originally appeared in the Friendswood Journal on February 27, 2014.
A growing number of Americans are calling the Lone Star State “home.”
Atlas Van Lines study 2013 Migration Patterns provides last year’s interstate and cross-border household goods relocations, noting that these large moves across the U.S. increased by 6 percent compared with 2012.
Depending on the job market, cost of living, and other factors, migration between states can tell us much about the economic condition and underlying policies that enhance economic prosperity.
Atlas shows Texas’ 13,503 total moves were second to only California’s 14,505 moves. However, Texas is an inbound state with 58 percent total inbound moves and California is a balanced state with 53 percent inbound moves.
Although these shipment statuses have been the same since 2005, these data do not account entirely for the extraordinary flood of people moving to Texas.
Accounting for California’s larger population, 60 percent more in 2004 and 45 percent more in 2013, a comparison of each state’s shipments adjusted for population differences is possible.
These adjustments show that in 2013 California’s 5,336 adjusted inbound shipments were far below the 7,856 inbound shipments to Texas. There is a similar trend of proportionally more people moving to Texas than to California since at least 2004.
Atlas’ provides valuable information about state-to-state moves, but it only includes a small portion of total moves because these are large item shipments.
To get a better picture, consider the U.S. Census American Community Survey (ACS) data for state-to-state migration flow in 2012—the latest survey available. That year 62,000 people moved to Texas from California and 43,000 moved in the opposite direction, giving net migration of 19,000 people moving to Texas.
One factor that drives people out of California is the high cost of living. When moving between states, most use a rental truck. The price of a rental truck varies based on the market for the vehicle and the moving location, making a rental truck a good market measure of state-to-state migration.
Consider a 26’ U-Haul truck from Austin, Texas to San Francisco, California. This move costs $931 from Texas to California but $2,860 in the other direction. This 3-fold difference is another indication that it is more expensive in California and there is more demand to move to Texas since it costs U-Haul to ship empty trucks back to California to get them positioned for the next move.
Another important moving factor is whether there are jobs available. Few other states have had a better employment record over the last decade than Texas. Compared with California, Texas has had a higher annual job growth rate and higher percentage of the population who are employed every year over the last decade.
These data show the obvious: many people continue to call Texas home to benefit from a lower cost of living and more job opportunities.
How does Texas lead in so many categories? Since both states have similar demographics, similar natural resources, and similar diversified economies, one area stands out above the rest: Texas’ limited government philosophy.
By sticking to conservative fiscal principles and focusing on allowing free markets to thrive to allow for entrepreneurs to innovate and prosper, prices remain low, unemployed find jobs, and people use their feet to move to reap these benefits.
Given these results, the Texas model that encourages entrepreneurship and free enterprise should be the framework other states and Washington, D.C. follow.
Vance Ginn, Ph.D., is staff economist for the Center for Fiscal Policy at the Texas Public Policy Foundation, a non-profit, free-market research institute based in Austin. He may be reached at firstname.lastname@example.org.