It’s well-known that companies and big-name investors moved to Florida during the pandemic. Ken Griffin was one of those. He moved his investment empire called Citadel from Chicago to Miami.
In mid-November he told Bloomberg that Miami could replace New York as the global financial capital.
“Let’s cut to the chase. New York is the financial capital of America today, and it’s New York’s to lose,” he said at a conference in Miami. “Now, having said that, Miami, I think, represents the future of America.”
Griffin is certainly not the first to think he’s seen in the future here. But this story is not about big investment companies or big investors moving to Florida. This is a story of working people coming here, perhaps without having to leave their jobs behind.
“We saw this big movement out in New York, New Jersey, Massachusetts and Chicago down into Florida,” said Ben Glasner, an associate economist at the Economic Innovation Group.
He looked at IRS 1040 data, examining income taxes in 2020 and 2021 and people’s adjusted gross income. That’s money from paychecks, dividends, business income, and money from retirement funds. Then he compared the differences in where people called home based on where they filed their taxes.
Billions of dollars of income moved to the area during those years. Palm Beach and Miami-Dade saw the highest amounts of any county in the country. Broward and Monroe counties were among the top 35.
Most of Palm Beach County’s new income came from Manhattan, Westchester and Nassau counties in New York and Fairfield County, CT. Incomes from Manhattan, Chicago and Los Angeles flowed into Miami-Dade. Broward County’s income didn’t have far to travel, though. Most of it crossed the county border from its neighbors immediately to the north and south.
About $1 out of every $6 in income that moved nationwide, relocated to Florida — by far, more than any other state
Remote work has led to some workers becoming untethered from their office, meaning they may be working in South Florida, but their job is somewhere else.
“Maybe this is a temporary movement. People enjoyed that first year, second year of movement. And then after a little bit of time, they thought, hey, it’s time to go back to the Northeast or, hey, it’s time to go back to California. San Francisco and New York are calling,” said Glasner.
That’s something that worries Kelly Smallridge, CEO of the Business Development Board of Palm Beach County. She calls the income and business migration “the greatest transformation of Palm Beach County’s economy” that she’s seen in 35 years.
That transformation has contributed to the housing affordability crisis. Home prices generally reflect the local job market and local wages. But with remote work, someone with a lower paying local job hoping to buy a home can’t compete with the remote worker and a higher paying out-of-state job.
The median price of a single family home in Palm Beach County has jumped 73 percent in the past four years. It’s up 69 percent in Miami-Dade County.
“It’s not just affordability, it is availability,” Smallridge said.
Miami-Dade Beacon Council CEO Rodrick Miller sees the affordability challenges, too. He also said the migration of this income and the remote jobs is helping diversify the workforce.
“It’s helping us build the muscular chops in terms of just not only diversifying who’s here, but also know how from an economic perspective, we’re getting a lot of different talents and skill sets down here,” he said.
Still, as fast as this income has moved to South Florida, it can just as fast move again.
Miller said, “The risk is that this money can leave. And I think we have to be conscious not only to attract that here, but to do things to make sure we keep this kind of investment flowing in.”
That risk has led Smallridge to change the focus of her efforts in Palm Beach County to keeping companies and workers here.
“It’s a big pivot in our efforts, and I think a lot of it is because you cannot take for granted that what you bring into this county is going to stay in this county.”
Just look no further than one of the more recently announced residents who is moving from Seattle after calling it home for almost 30 years. Ok, for Amazon’s Jeff Bezos, it’s more of a return to South Florida, the billionaire’s childhood home.