A 100 Billion Wealth Migration Tilts US Economy’s Center of Gravity South

Drive along the 240-mile stretch of the Atlantic coast from Charleston, South Carolina, through the grassy marsh land of southern Georgia and down into northern Florida, and you’ll see one of the most profound economic shifts in the US today.

Electric-vehicle factories and battery plants are overtaking pine forests in this region of antebellum architecture and shrimp and grits. More broadly, the entire South from here, north to Kentucky and west to Texas is where businesses are moving to, jobs are being created and homes are being bought. The uplift isn’t happening equally everywhere, or equally for everyone. But the implications for the entire country are enormous.

The numbers tell the story. For the first time, six fast-growing states in the South — Florida, Texas, Georgia, the Carolinas and Tennessee — are contributing more to the national GDP than the Northeast, with its Washington-New York-Boston corridor, in government figures going back to the 1990s. The switch happened during the pandemic and shows no signs of reverting.

A flood of transplants helped steer about $100 billion in new income to the Southeast in 2020 and 2021 alone, while the Northeast bled out about $60 billion, based on an analysis of recently published Internal Revenue Service data.

The Southeast accounted for more than two-thirds of all job growth across the US since early 2020, almost doubling its pre-pandemic share. And it was home to 10 of the 15 fastest-growing American large cities.

Corporations are also flocking there, with a record number of firms moving south after the pandemic, Census Bureau data show.

Dun & Bradstreet was one of them.

The company, founded 182 years ago by abolitionist Lewis Tappan, was until recently headquartered in Short Hills, New Jersey, its location a major plus for a financial-information firm with close ties to Wall Street.

But in 2021, the company decamped for Jacksonville, Florida, on the southern edge of that 240-mile coastal band.

Jacksonville lacks the money and star-power of Gable Estates, Fisher Island and other elite South Florida enclaves. Part of downtown is vacant and lifeless. Surrounding Duval County suffers from the state’s highest crime rate. And, despite locals’ fondness for steel-truss bridges, they and the big seaport give Jacksonville an industrial feel not found in Florida’s more glamorous cities.

What Jacksonville does have is a powerful lure for companies and people looking to work for them. In Dun & Bradstreet’s case, that included a $100 million package of cash and tax incentives.

Chief Financial Officer Bryan Hipsher said the firm would’ve gladly stayed in the New York area. But the offer in Florida was too good to refuse. 

“You feel very wanted, right?’’ Hipsher said in an interview from the new palm-fringed headquarters, minutes from the beach. “You feel very welcomed, clearly.”

The average employee here has an annual salary of $77,000, 25% above the national level, and well outstripping most local salaries. Still, many roles pay roughly 15% below the average at the former New Jersey headquarters.

Jacksonville grew so fast that it surpassed San Jose in population last year. Good schools, including University of Florida an hour and a half away, help provide a high-quality employee base, Hipsher said. Today the firm is still busy hiring — it’s a little less than halfway to its goal of 500 workers.

Not far away, the Jacksonville branch of the Mayo Clinic, the world-famous medical center based in Rochester, Minnesota, is growing along with the city. A new oncology building is going up and last year, it added 2,400 employees, bringing the total here to 9,000.

The company’s move highlights the forces that have sent 2.2 million people migrating to Florida and across the Southeast in the past two years — roughly the size of Houston.

The term “New South” was coined after the Civil War during a time of economic transition for the formerly slave-owning region. “The South has always been reinventing itself,” said Gavin Wright, an economic historian who studies the southern economy. “Every generation seems to have its ‘New South.’”

In recent decades, the warmer weather, lower taxes, looser regulation and cheaper housing lured companies and retirees. But this pandemic-era Sun Belt economic upswing is wider in scope.

“You could throw a dart anywhere at a map of the South and hit somewhere booming,” said Mark Vitner, a retired longtime economist for Wells Fargo who now heads his own economic consultancy, Piedmont Crescent Capital, in Charlotte, North Carolina.

Nashville, where the asset-management firm AllianceBernstein relocated a few years ago, has become the country’s top real estate “supernova” in surveys by PricewaterhouseCoopers and the Urban Land Institute. Houston, Atlanta and Charlotte, longtime home of Bank of America Corp., rank among the top 10 moving destinations nationwide by Penske Truck Rental — all ahead of boomtown Austin.

And no one beats Fort Worth, Texas, near Dallas, the country’s fastest-growing big city in the latest Census Bureau data.

“We now have more employees in Texas than New York state. It shouldn’t have been that way,” JPMorgan Chase & Co. CEO Jamie Dimon said to Bloomberg TV on a swing through the South earlier this year.