This Analysis Says Dallas County Behaves Like New York Or San Francisco

I like looking into net migration figures because they arguably boil down a lot of economic and social factors. People move with their feet to the area that is most appealing to them. Any number of things might drive this, but the results are pretty stark.

Domestic Net Migration Favors The Parts Of The Country You'd Expect

I applied k-means clustering to some statistics derived from the latest net migration figures and identified 6 “types” of counties. These are grouped by similarity, so they aren’t evenly distributed in terms of land area, number of counties, or least of all population.

50% Of U.S. Population Is In 5% Of Its Counties

In many cases these groupings are somewhat predictable, but the interesting parts of this sort of analysis are in the connections you wouldn’t make, or might be on the fence about making. For example, this analysis lumps Dallas County in with other “core” counties, like New York County and San Francisco County.

Group 4 - "The Core" - Has A Lot Of Domestic Out-Migration

The drivers of migration could be anything, social, academic, or political, but a lot of times economic drivers are commonly cited. New jobs or less expensive housing often finish near the top of the list of reasons to move, though being closer to family is also a very important factor.

The U.S. Census lags a couple years behind on publishing net migration figures on a county-to-county level. The most recent data set is from 2016-2020. However, these figures are still useful, as net migration has a tendency to react to longer-term trends, especially on a metro-to-metro or region-to-region basis. 

The U.S. Is Still Urbanizing

There are 3,143 counties in the 50 U.S. states plus D.C. You can’t be expected to know the details of all, or even most of the U.S. counties, and even for the ones you do know, you might miss the quantitative connections that this sort of analysis catches.

Using net migration data and clustering algorithms (in this case k-means) you can group counties by their attributes and gain an understanding of how people move into and out of various parts of this country, as well as what might drive demand for commercial real estate (among other things)

With that in mind, I wrote out a detailed accounting of each group:

Group 1 - The Biggest Losers - 2 Counties

LA and Cook counties. Any acknowledgement of raw size in a cluster analysis will try to put LA in its own cluster. At 1.51 standard deviations away from the mean population of a county, LA is huge. The next closest is Cook county at .77 SDs away. 

Size isn’t all these two have in common. Population is streaming out of these two, and cumulatively 1.4% of their 2020 population left from 2016-20. While the majority of that stays close by, about 32% heads to a different region of the country. For LA county, that is most commonly the Mountain West, while Cook County residents look to the Southeast (often Florida) as their key destination. For both, Texas is the second most common destination.

International in-migration is relatively strong in this group, especially for LA county.

Group 2 - Challenging Conditions - 84 Counties

There are some rural parts of the country that are in very rough shape with little economic hope shining through. Group 2 had an average of only 7,290 people in each of its 84 counties in 2020 and an average of 660 people left these counties from 2016-2020. 

Some of these counties are better off than this analysis would suggest. Crane County in Texas apparently lost 30% of its population over the 5 year period captured, but Crane County is an oil-producing area, prone to the fits and starts of a very cyclical economy. In all likelihood that flow will reverse course at some point.

Owsley County in Kentucky, in comparison, is a coal-driven county where the population peaked in 1980. Most migrants in the studied time period went to other parts of Kentucky.

Alexander County in Illinois, also in group 2, has a fifth of the population in did in 1940. The county seat, Cairo, sits at the confluence of the Ohio and Mississippi Rivers. As rail and automobile traffic increased and drifting river barges became replaced by motorized transport, the relative importance of the Cairo waypoint diminished.

The short-term outlook for a lot of these areas is not very good.

Group 3 - Stable, But Slipping - 1,857 Counties

These are mostly counties with pretty mild out-migration, though about 19% have (mildly) positive net migration. The migrants from these counties tend to move to other parts of the country at a high rate - about 40% of net migration went to a different region, compared to only 32% for Group 1 or 21% for Group 2, implying their migrants have the resources or will to go to greater lengths to chase opportunity. 

The counties in this group average smaller and include a lot of rural America, but some big names like Marion County in Indianapolis and Suffolk County in Boston are in this group as well. Both of those counties experienced ~1% negative net migration from 2016-20.

This group represents about 58% of all the counties in America, and as such there’s a relatively even spread amongst regions, but it’s worth noting that the Mid-West, New England, and Mid-Atlantic are overrepresented, while the Southeast, Mountain West, Greater Texas, and Coastal West are all underrepresented. This is not surprising given that net migration for this group is negative, even if it is relatively slow negative net migration.

Group 4 - The Core - 15 Counties

These counties have a lot of domestic out-migration, but nearly as much international in-migration. 72% of the domestic out-migration stays in-region, a higher proportion than average. 

These counties include some of the densest parts of a lot of the densest metros in the country and tend to be expensive places. Although the expense drives a lot of people out, there is quite a lot of “gross” migration, which is to say that a lot of people come in and out each year. The amenities and job opportunities are still strong draws.

Most of the major metros are represented in this group. Orange County, San Francisco County, Santa Clara County (San Jose), Miami-Dade County, Broward County (Fort Lauderdale), Fairfax County (Northern VA), Middlesex County (Cambridge/North of Boston), and of course Bronx, Kings (Brooklyn), Queens, and New York County. Richmond County (Staten Island) is in group 3.

Two more counties make this group, Dallas County, and Harris County, the two central counties for the Dallas and Houston metros, respectively. Harris County actually has international in-migration that outpaces domestic out-migration, but Dallas County falls pretty close to the group average on that ratio. I mention these two specifically because there are some folks who go back and forth on whether Dallas and Houston can be considered core markets for commercial real estate. Obviously this analysis has settled the argument; Dallas and Houston are core.

Group 5 - Large And Growing - 26 Counties

This is one of the only two groups defined that have positive domestic migration. These counties are smaller and less dense than the absolute core metros of group 4, but they are large relative to the rest of the counties, drawing people in from all over the country, and pull in international migrants at a reasonable clip as well.

The statistics here are unique because they have good, positive domestic in-migration, with 0.9% of 2020 population having moved to these areas in the previous five years, but that is generally driven by people moving in from outside of these county’s regions, while net migration within these county’s regions is negative.  For example, Boulder County had a net positive ~7,300 migrants from 2016-2020. About 8,000 came from outside of the Mountain West, while a net of 700 left Boulder and went to other parts of the Mountain West. So these areas are very attractive to outsiders, but that in-migration may help drive up expenses such that others end up leaving, often to close-by areas.

Collier County (Naples), Ada County (Boise City), Clark County (Las Vegas), Travis County (Austin), and Maricopa County (Phoenix) all follow that same pattern of strong in-migration from the rest of the country and weak out-migration to nearby areas.

Group 6 - Bright Lights, Non-Primary City - 1,237 Counties

This group actually has the best domestic in-migration figures of any of the groups, and the worst international in-migration. Almost none of the domestic in-migration comes from out of region (only 20%). And while there are some large counties in this set, like Pinal County (Phoenix), the average size is the second smallest of the six groups.

The most notable of these counties are generally suburbs of major metros, like Pierce County (Seattle), Fort Bend (Houston), Pinal County (Phoenix), or Osceola County (Orlando). Riverside County and San Bernardino County are in this group, and though it may be a bit snide to say they are essentially suburbs of LA when they technically fall in their own metro (Riverside-San Bernardino a.k.a. Inland Empire), I’m going to say they’re suburbs of LA anyway. These counties tend to benefit from the strong draw of the central cities they surround, and the relative affordability they offer. The counties of some of the star metros of the last five years, like Charlotte, Austin, and Raleigh are predominantly in this group, and group 5 as well.

Some of the smaller counties on this list are interesting as well, like Volusia County (Daytona Beach), Pitt County (Greenville), or Weld County (Greeley). These are smaller counties that encompass smaller metros, but the strong, positive, net in-migration makes them very attractive. It’s a tough game to try calling the next Charlotte, Austin, or Raleigh, but some of these metros are at least showing the markers.