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Once Back in the Pack, Dallas Now the Top Destination for "Young People" After Austin

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There was a piece in this morning's New York Times about how Austin's now the top destination for the young American, all right. So notes Brookings Institution demographer William Frey, who adds Dallas to the list of Top Five destinations for the highly coveted 25-to-34-year-old. Only a few years ago, we weren't even among the Final Five, which included, in order, Riverside, California; Phoenix, Atlanta; Houston and Charlotte, N.C. Back in '07, Dallas-Fort Worth came in at No. 7.

Houston keeps its No. 4 position, based on 2007-'09 Census Bureau info, but according to data provided to Unfair Park by Brookings, Dallas now ranks No. 2 -- behind Austin and just ahead of Denver, Houston and Seattle. Says Frey, who called Unfair Park this afternoon for a quick chat before boarding a flight, the answer to why Dallas has become a top destination for the recent college grad and young adult is simple: "The economy's doing well compared to other cities."

He continues: "When we look at other Census estimates, Dallas as a metro and Dallas as a city has done better than other places -- and better than itself a few years ago. Austin's a three-fer: a college town, a tech center and a cool city. Dallas maybe gets a B-plus in some of those, but it's the economy that's driving migration patterns."

John Fairbanks at Brookings was kind enough to forward some spreadsheets and the entirety of Frey's paper, "Migration Declines Further: Stalling Brain Gains and Ambitions," published yesterday. It follows.

Migration Declines Further: Stalling Brain Gains and Ambitions

By William H. Frey

The tepid gains in employment and the rise in home foreclosures over the last couple of years have led to an even further plummeting of the nation's already historically low levels of long distance migration, as chronicled earlier. Between March 2009 and March 2010 interstate migration stood at 1.4 percent, lower than any year since the Census Bureau's Current Population Survey started collecting that data in 1948 (Figure 1). While there is some debate about how accurately the survey documents the timing of this decline, there is no doubt that the last three years have seen a plateau in migration for interstate moves and, in fact, total moves (Figure 2).

The stall has affected college graduates and young adults--groups usually among the most mobile and coveted--which tend to be the lifeblood of the labor force and responsive to shifts in national job networks. Between 2008 and 2010, the annual interstate migration of this group fell to 2.1 percent, well below the levels of 3 percent and above earlier this decade and in the 1990s. This is indicative of young adults encountering a brutal job market, as many double up or remain at home with their parents or other families. The annual migration rate for adults aged 25 to 29 fell to 3.2 percent in 2009-2010, also an historic low point for this usually highly mobile group..

How is this slowdown affecting the ability of areas to attract these two prized groups?

The Census Bureau's American Community Survey (ACS) provides some clues about migration between censuses. The just-released ACS files for the 2007-2009 period allow us to compare the changes in flows for the 52 largest metropolitan areas (those with populations over 1 million) during this low migration period with the more booming period of 2005-2007 (representing average one year net migration levels over these two periods).

The shifts in geography for adults with college degrees are telling (Table 1). In 2005-2007, college-educated adults, like other segments of the population, were strongly attracted to "bubble" metro areas like Riverside, Phoenix and Las Vegas where easy credit and affordable housing were available. Though some more knowledge economy-oriented metros like Charlotte, Austin and Tucson also topped the list. These six metros increased their college graduate populations by an average migration gain of more than 2 percent annually while another 10 gained by more than 1 percent.

By 2007-2009, only one large metro enjoyed college graduate migration gains of more than 2 percent--the university/research center of Austin, followed closely by Raleigh and Portland, both known to have great cachet among young professionals.

While Riverside and Phoenix still drew college graduates, their rates of gain slowed dramatically. Las Vegas showed a drop in college graduate net migration from an average of nearly 5,000 per year in 2005-2007 to less than 500 per year in 2007-2009.

At the same time, many metro areas that were losing adults with college degrees in mid-decade, started holding onto more of them as the housing and labor markets froze. Prime examples are New York and Los Angeles, where annual migration losses abated sharply. Others such as Buffalo, Cleveland and Chicago experienced smaller brain drains due to lack of opportunities elsewhere. There was a renewed retention of migrants for areas like Pittsburgh, San Diego, San Francisco and Columbus, as more affordable housing dried up in other places (Table 2).

Young adults seeking to take new jobs, buy homes and start families were just as stymied during this period, and the primary destinations they chose, when they did move, were quite distinct (Table 3). In mid-decade, top migration destinations numerically for young adults were interior West growth centers--Riverside, CA and Phoenix--and a mix of economically vibrant places like Houston, Atlanta and Charlotte.

By the late 2000s, four of the top five mid-decade magnets were replaced. Austin rose to the lead, and two other relatively vibrant Texas metros, Dallas and Houston, moved up the list. Other rising areas like Denver, Seattle and Portland, tended to be knowledge-based cities with lifestyles attractive to young people.

Yet rates of gain for many popular metros are generally not as high as in mid-decade and many older Northern and coastal areas continue to hold on to young people who would otherwise be fleeing to opportunities elsewhere.

The recent more tentative migration patterns of the younger and "best and brightest" segments of our population are holding back the free flow of human and social capital that has made our society more vital and dynamic than most of our developed country peers. This slowdown, in addition to the decline in immigration can be expected to pick up when the economy revives. But if it takes too long, we run the risk of creating a "lost generation" of young adults, the likes of which we have not seen for some time.

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