“I always had to go to where the job was,” says Sankeerth Bommi, a 40-year-old technology worker from India who emigrated to the U.S. in the early 2000s. When the pandemic hit, Bommi was living in Los Angeles and commuting to the Pasadena offices of financial-technology company Green Dot Corp., where he is a senior director on a product team. Within weeks, the company told its 900 employees they were free to permanently work from anywhere.
Bommi moved to Austin to be closer to cousins in Oklahoma and Texas, and for cheaper housing. He just bought his first house, where he plans to work once it is built. “This is the first time I’m able to go to the city I really wanted to go to,” he says.
In the end, his employer made the same move. The company last year moved its headquarters to Austin, slashing its real-estate and business-travel costs, because of Austin’s central location.
The pandemic has changed the geography of the American economy, according to reporting by the Wall Street Journal.
By many measures, red states — those that lean Republican — have recovered faster economically than Democratic-leaning blue ones, with workers and employers moving from the coasts to the middle of the country and Florida.
Since February 2020, the month before the pandemic began, the share of all U.S. jobs located in red states has grown by more than half a percentage point, according to an analysis of Labor Department data by the Brookings Institution think tank. Red states have added 341,000 jobs over that time, while blue states were still short 1.3 million jobs as of May.
Several major companies have recently announced moves of their headquarters from blue to red states. Hedge-fund company Citadel said recently it would move its headquarters from Chicago to Miami, and Caterpillar Inc. plans to move from Illinois to Dallas-Fort Worth.
To track each state’s progress toward normal since the pandemic began, Moody’s Analytics developed an index of 13 metrics, including the value of goods and services produced, employment, retail sales and new-home listings. Eleven of the 15 states with the highest readings through mid-June were red. Eight of the bottom 10 were blue.
Behind those differences is mass migration. Forty-six million people moved to a different zip code in the year through February 2022, the most in any 12-month period in records going back to 2010, according to a Moody’s analysis of Equifax Inc. consumer-credit reports.
The states that gained the most, led by Florida, Texas, and North Carolina, are almost all red, as defined by the Cook Political Report based on how states voted in the past two presidential elections. The states that lost the most residents are almost all blue, led by California, New York and Illinois.
Analysts who have studied the migration attributed much of it to the pandemic’s severing of the link between geography and the workplace. Remote work allowed many workers to move to red states, not because of political preferences, but for financial and lifestyle reasons—cheaper housing, better weather, less traffic and lower taxes, the analysts said.
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