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The Wealth Effect in Florida: Attracting High Earners

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David Brierton

David Brierton

2 minutes

The Wealth Effect in Florida: Attracting High Earners

The Wealth Effect in Florida: Attracting High Earners

Florida is currently experiencing a significant influx of new residents, particularly among the wealthy and high earners, from various parts of the country and the world.

Florida has been traditionally known as an affordable retirement destination, attracting people of diverse economic backgrounds to enjoy its excellent amenities and weather. However, the perception that coastal job markets offer the best opportunities for career advancement and financial success has persisted for a long time.

Over the years, Florida has actively transformed its economy and worked on changing these perceptions. Through investments in various industries and improvements in education, the state has elevated its economic stature. It took strategic marketing efforts and the impacts of the pandemic to firmly establish Florida as a top choice for high-income earners.

During the pandemic, Florida experienced a significant influx of migrants from all walks of life. Recent estimates from the U.S. Census Bureau indicate that Florida’s population grew by 1.6% between 2022 and 2023, making it the second-highest growth rate among all states. This equates to approximately 1,000 new residents per day or 365,205 in total for that period.
Although the surge in migration tied directly to pandemic-related factors has subsided somewhat, Florida continues to see a positive trend of net population growth from both domestic and international sources.

This migration trend encompasses a wide range of demographics but notably includes an increase in wealthy individuals and high-wage earners. To understand this trend better, we conducted a detailed analysis using Internal Revenue Service data comparing tax returns from 2021 to 2022, which tracked where people moved from and to, along with their reported incomes.
Focusing on high-wage earners, we examined two specific age groups: young professionals aged 26–34 and individuals in their prime working years aged 35–54. We defined high-wage earners as those making over $200,000 annually.

Between 2021 and 2022, Florida saw a net influx of over 1,700 young professionals earning over $200,000, the highest number in the nation. Texas and Colorado followed in second and third place, respectively. In the prime working years category, Florida attracted over 10,600 high-wage earners during the same period, according to Census data.

Conversely, California and New York were the top states experiencing a loss of high-wage earners in their prime working years. This mirrors broader migration trends from these states, which reported significant outflows of approximately 396,000 and 284,000 individuals, respectively, between 2021 and 2022. For young professionals, California and Illinois had the highest losses, with Illinois alone seeing an outflow of nearly 155,000 people across all age and income brackets.

Traditionally, wealthy retirees relocating from expensive coastal regions have favored Florida for its sunshine and lifestyle amenities. Popular destinations include Naples, Palm Beach, the Panhandle, and northeast Florida, which cater to this demographic’s needs for healthcare and wealth management services.

With wealthier individuals relocating at younger ages, their priorities differ significantly. They seek quality schools, office spaces, daycare facilities, and business infrastructure. This demographic has the potential to reshape local economies for years to come. Recognising and adapting to these shifting demographics is crucial for businesses and service providers looking to attract and cater to this younger, wealthier clientele.

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