Domestic Migration and Wealth: Texas’ Ongoing Boom 

More people are moving to Texas from other states than are leaving for opportunities elsewhere. Using IRS migration data for tax years 2016-21, we see a pattern of positive domestic migration that has been growing fast and steadily since 2017 (Figure 1). A positive net migration increase occurs when more people move to Texas than leave the state.   

Texas ranks as the second-most-popular destination for domestic movers, following Florida. The spurt in net inflow was sharp during 2020, and since then has increased at a slower rate. With lower unemployment rates, affordable housing, lower cost of living, and a relatively stronger economy, Texas continues to attract migrants from other states. These same factors also make Texans less likely to leave. 

The IRS migration data provide insights into the income profile of movers, showing a positive flow of Adjusted Gross Income (AGI) to Texas (Figure 2). AGI is the net difference between the income of people coming to Texas and that of people leaving Texas. In 2020, Texas’ net AGI crossed $10 billion, coinciding with the sharp increase of almost 175,000 net incoming movers. As the upheavals of the pandemic era diminish, migration patterns are likely to return to being driven by a state’s relative economic advantages rather than by sudden shocks. 

When we examine the states from which movers come, the patterns have remained consistent over the years. As expected, California, being the most populous state, continues to lead as the top source of new Texas residents, followed by Florida and Louisiana (Figure 3). Similarly, the states Texans choose to move to have stayed relatively stable, with California and Florida consistently being the top destinations.  

In 2021, when analyzing the average income by state, the 106,882 incoming residents from California had the highest average income of $74,000.