According to a recently published Bloomberg report, U.S. macroeconomic strength has radically shifted and become centered around the American Southeast, as investment and business have flooded from Northeastern states such as New York and Massachusetts to more business-friendly climates in Florida and Texas.
For the first time, six rapidly developing southern states – Florida, Texas, Georgia, North Carolina, South Carolina, and Tennessee – are contributing more to the national GDP than the entire Northeastern United States. This transition happened during the Covid-19 pandemic and seems to indicate a permanent shift.
The South attracted approximately $100 billion in new income in 2020 and 2021, while the Northeast lost about $60 billion. The Southeast was responsible for over two-thirds of all job growth in the United States since early 2020, almost doubling its pre-pandemic share.
According to U.S. Census Bureau data, a record number of corporations moved to the South post-pandemic. One such firm is Dun & Bradstreet, which relocated its headquarters from New Jersey to Jacksonville, Florida, lured by a $100 million package of cash and tax incentives.
Jacksonville’s population grew so quickly that it surpassed San Jose, California last year, indicating the broader trend of people and businesses migrating to Florida and the Southeast. “The South has always been reinventing itself,” noted Gavin Wright, an economic historian. A variety of factors, including warmer weather, lower taxes, and looser regulation, have attracted companies and retirees to the region.
The southern economic upswing is widespread. Cities like Nashville, Houston, Atlanta, Charlotte, and Fort Worth are seeing increased growth, attracting top firms and becoming real estate havens. JPMorgan Chase CEO Jamie Dimon acknowledged that the company now has more employees in Texas than in New York.
In Charleston, South Carolina, electric vehicle plants and housing developments are replacing forests. The city’s employment grew by 5.9% last year, twice as fast as the national average. Transplants from New Jersey and California are drawn to the area for its lower property taxes and lifestyle.
As it stands, the South, epitomized by the 240-mile stretch from Charleston to northern Florida, seems to have become a new economic powerhouse in the United States.