The future of US growth is already here

There has been much speculation that Americans will increasingly abandon urban environments in favor of suburban and even rural destinations. As evidenced by articles with titles such as “Is New York City Over?¹” and “New York City is Dead Forever²” the media has been particularly focused on the fate of New York City.

Notably missing from these discussions is recognition of the country’s existing internal migration patterns. As economically and culturally dynamic as places such as New York City and San Francisco might be, for example, Americans have been flocking to less expensive, opportunity-rich locales for decades. Long before the onset of the pandemic, most high-cost coastal communities ceased to be major drivers of population growth. Notably, this is true at both the city and regional level³.

The dramatic skylines of places such as Manhattan and downtown Chicago often obscure the fact that most people in major metropolitan areas do not live in the central city. Less than half of all people residing in the New York metropolitan area, for example, are actually located in New York City. Less than one-third of Los Angeles or Chicago metropolitan residents live in Los Angeles or Chicago proper. In the Washington, DC, metro, nearly 90% of residents live outside of the nation’s capital⁴. While the country’s leading cities are often centers of commerce, culture and recreation, they are not the places where most Americans ultimately decide to reside.

Ten largest US metros - central city share of metropolitan area population, 2019

Furthermore, most Americans would probably be surprised by the cities currently posting the greatest increases in population gains. While the resurgence of urban cores in places such as New York and Washington, DC, have been widely heralded, their growth is eclipsed by smaller communities located in the South and West. Between 2010 and 2019, for example, the three US cities that posted the largest population gains were Phoenix, Houston and San Antonio. On a percentage basis, the gap in population growth between many high-cost coastal cities and smaller Sun Belt cities is even more apparent. Since 2010, the populations of Los Angeles, New York and Chicago have all increased by less than 5%. During this same period, cities such as Austin, Fort Worth and Charlotte saw their population growth rates top 20%.

At the regional level, the Sun Belt’s dominance is even more striking. During the past decade, the major drivers of US job and population growth have largely been regions characterized by affordability, diversity and global connectivity. Notably absent from this list are the country’s largest regions, as well its leading technology giants. Since 2010, for example, population growth in the Dallas–Fort Worth metroplex exceeded the collective gains of New York, Los Angeles and Chicago by a half-million residents. Atlanta’s population growth during this period surpassed the combined gains of San Francisco and Boston. The California metro posting the greatest population increases is not Los Angeles, but its more affordable neighbor Riverside.

As disruptive as the pandemic has been, in many ways it has simply accelerated existing trends. Telecommuting, though far from widespread, has been on the rise for more than a decade⁵. E-‍commerce sales have increased year-over-year nearly every quarter since 2000⁶.