The South is Rising Again
May 1, 2017
Last year the New York Times published an article called “A Dearth of Pioneers” noting that Americans’ pioneering spirit was disappearing as fewer and fewer Americans are willing to move for a new opportunity. Historically, going back to the days of our founding fathers, Americans were willing and eager to move to different parts of the country in order to search for new opportunities. This pioneer movement with the mantra of ‘go west’ pushed our country from the Atlantic to the Pacific and greatly shaped economic growth. The thesis of the article argued that a lack of mobility would slow our economy. I saved the article because it struck me to be flawed and incongruent with my personal observations. Economic data released this week seems to support this notion of continued mobility and that the pioneering wagon is still alive and well.
The Brookings Institute released data that shows that Americans are once again on the move. Last year 600,000 people moved from the Northeast and the Midwest to the Sun Belt. That is the largest number of people to migrate since 2005. The Brookings team cited that the two major groups accounting for this new wave of migration are retirees and young job seekers. Retirees that had once been trapped in their homes due to the 2008-2010 housing crisis meltdown have finally seen the values of their homes rebound creating the chance to get out from what may have been underwater situations. This combined with the explosion in the values of stocks in retiree 401k plans has been enough of a catalyst to say goodbye snow, hello sun. Within the retiree world the two most popular destinations were Myrtle Beach and Orlando as clear winners with the retiree set.
Young people looking for new jobs account for the other wave of people moving to the South. Recently, Georgia, Florida, and Texas all have seen the growth in the migration by young workers double. Those in the Atlanta market have marveled at the amount of apartment construction that has occurred in the last several years. There is currently an overwhelming belief by locals that the apartment market in Atlanta must surely be at a tipping point. How many more apartments can be built before a crash is often a storyline repeated in real estate circles. But it was just reported last month that the Atlanta metro employment growth rate was 3.9% last year. That is the highest jobs growth rate ever recorded for Atlanta. If a 4% growth rate for young professional jobs continues, don’t be surprised if Midtown Atlanta starts to look like Midtown Manhattan.
Carl Gambrell
