High Income Flight
A Siena College study shows 44 Percent of Six-Figure Earners in NYC Have Considered Relocating.
The study also says 80% of those living in the city make $100,000 or more.
If 44% of 80% consider leaving, that is 35.2% of the total population.
Key Findings
- Of New York City residents who earn $100,000 or more annually, 44% have considered moving out of the city in
the past four months. Looking ahead, 37% say that it is at least somewhat likely that they will not be living in the city within the next two years. - More than two-thirds (69%) are “not confident that New York City will be back to normal anytime soon,” while just 28% believe that the city “will weather this crisis, and things will be back to normal soon.”
- Respondents from Staten Island are especially pessimistic: 89% say that they are not confident in a timely return to normalcy.
- Some 80% of New Yorkers earning six-figure salaries or higher believe that economic activity in the city will take longer than a year to recover, and just 20% say that the economy will return to normal in the next 12 months.
- Older respondents are more pessimistic about the recovery, with 89% of those 65 years and older expecting recovery to be more than a year away
- Only 38% of New Yorkers surveyed said that quality of life now was excellent or good, a drop by half, from 79%
before the pandemic. Most believe that the city has a long road to recovery: 69% say that it “will take longer than a year” for quality of life to return to normal. - 75% of respondents cited income taxes as a problem, while 72% pointed to traffic and 68% to the reliability of public transportation.
- The greatest concern of all was the likelihood of coronavirus spread, with 90% saying that it posed a problem for them.
- Among respondents with children who attend public school in New York City, more than half (53%) said that they are very concerned about sending them back to school, including 76% of black respondents. Those in the Bronx (72%) are warier of sending their children to reopened physical schools than those in Manhattan (40%).
- Income taxes appear to be a bigger concern for respondents than property taxes (75% to 60%, respectively, saying that these taxes are at least somewhat serious problems). Even for these New Yorkers earning six-figure salaries and above, 89% cite cost of living as a problem.
Governor Cuomo Begs Rich New Yorkers to Return
In an effort to get wealthy New Yorkers to return, Governor Andrew Cuomo says ‘Come over, I’ll cook!’
“I literally talk to people all day long who are now in their Hamptons house who also lived here, or in their Hudson Valley house, or in their Connecticut weekend house, and I say, ‘You got to come back! We’ll go to dinner! I’ll buy you a drink! Come over, I’ll cook!’
“They’re not coming back right now. And you know what else they’re thinking? ‘If I stay there, I’ll pay a lower income tax,’ because they don’t pay the New York City surcharge,” he added, noting the wealthiest 1 percent of the Empire State’s population picks up roughly 50 percent of the state’s tax burden.
NYC Mayor Says ‘I Am Not Going to Beg’
In sharp contrast to governor Cuomo, NYC mayor Bill de Blasio says ‘I Am Not Going to Beg’.
In a briefing from City Hall, de Blasio for a second day in a row sneered at Gov. Cuomo’s suggestion that the Big Apple’s ballooning deficit can only be bridged if rich people who fled at the outset of the pandemic come back and start paying taxes again.
“I am not going to beg anybody to live in the greatest city in the world.”
De Blasio also reiterated his demand for taxing wealthy New Yorkers at a higher rate and said the most “fair” period in American history was in the high-taxed aftermath of World War II.
“We saw much less income inequality,” he said. “We had the model right.”
The Right Model
De Blasio, a true progressive nutcase, wants a 90% income tax rate.
If he tried that at the city level rather than nationally most of NYC would vacate.
Modern Income Tax
The Modern Income Tax started in 1913 at a modest 1% rate.
By 1918 it was 77% to finance WWI which the US should never have been involved in.
In the name of “fairness” President Franklin D. Roosevelt idiotically proposed a 100% tax on all incomes over $25,000.
In the wake of WWII marginal rates got as high as 94% on incomes above $200,000.
Rates have generally been falling since 1964 when the top rate was lowered to 70%.
Mish
Mish, you forgot to mention that most never paid that much because of business write offs and the average joe didn’t make anywhere near that much.
it all harbors on company policy on telecomuting. a big reason many give up the space of larger homes is to shorten commute times to spend time with family. if companies become more generous with work at home the equation changes
Politically incorrect here (I’ll blame it on being an immigrant who did not adjust even after three decades spent here): Is there a way to estimate how many of those interested in leaving NYC prioritize as a reason the results of the leftist policies as even more important than the effects of the pandemic? Yes, I know people lie, we all saw some presidential poll responders hiding they were going to vote for Trump, but can’t there be some appropriate questions to scoop out that data?
I wonder if it is the death of the local eateries/bars that is driving much of it? Retail was already getting crushed. But good food seems to be a huge draw for a lot of people in urban settings. That and easy transport to work.
Otherwise, I don’t see why NYC is somehow more expensive than what it was pre-Covid. It just doesn’t have the upside.
Progressive income taxes have nothing to do with income inequality. Productivity and sound money does. The tax code is just welfare for accountants.
Developer Closeout of final inventory!
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This post should not be at the top. Sort order to newest is now messed up.
I revised a sentence to make it more understandable. Have a fix request in.
NYC is boring
To Me ….What you wrote doesn’t make any sense “The study also states 80% of those living in the city make $100,000 or more, and that translates to 35.2% of all residents.”
Of course it makes sense.
44% of 80% consider leaving
.44 * .8 = 1.0 X
35.2% of the total
From the Siena article: “Residents who earn $100,000 or more make up 80 percent of New York City’s income-tax revenue, making the city especially vulnerable to tax-base erosion.” After a lot of the high income folks leave, NYC will still be stuck with its low income renters living in public housing and its large Hasidic families, many of whom are low income on a per capita basis. If a family with 10 children has an annual income of $60,000, I suspect that it still qualifies for Medicaid, which is covered 50% Federal, 25% State and 25% local and pays little or no state and local income tax.
Where would they go? Nobody wants that ideological infestation next door.
Mish you have part of it wrong:
“Residents who earn $100,000 or more make up 80 percent of New York City’s income-tax revenue. That personal income tax, in turn, accounts for 22% of the city’s overall tax revenues. “
What you wrote doesn’t make any sense “The study also states 80% of those living in the city make $100,000 or more, and that translates to 35.2% of all residents.”
Also, people on Staten Island have been miserable since the bridge went up. Nothing new there.
Thanx for the clarification.
This is the question I posed two comments back.
“44 Percent of Six-Figure Earners in NYC Have Considered Relocating”
44% x 0.8 = 35.2%
Second grade math, but it may require fourth grade reading comprehension.
I live in Manhattan. The only plus is that Social Security and Pension income are not taxed by the city or state. That and 50% discounts for MTA busses and LIRR means healthy seniors can live OK without a car and with a Summer escape Home on Fire Island reachable by LIRR and Ferry once the covid scare goes away.
That’s a pretty big plus.
Nearly every city and State Democrats control are places people want to leave because democratic policies do not work. They literally turn nice places into toilets as anyone in San Francisco can tell you. Democrats destroy everything they touch.
Also working the GIG life may not work out so well in cheaper suburbia wher e there are less customers available.
Jobs In The Pandemic: More Are Freelance And May Stay That Way Forever
September 16, 2020
Your big paycheck might decline if you leave the expensive cities!
No Exit: VMWare Joins Growing Group Of Tech Cos Threatening To Cut Employees Wages For Leaving San Francisco
Fri, 09/11/2020 – 15:09
So many white collar jobs can now be done remotely, it’s one less reason to live in a big city “where the jobs are.” I just hired someone in AZ to be on the team “in” OR. Why not?
Just don’t go visit him between May to Oct when 100°F+ days are de rigueur.
“80% of those living in the city make $100,000 or more, and that translates to 35.2% of all residents”
So who are all the people earning >100,000 that somehow live in the city without being residents?
In the wake of WWII marginal rates got as high as 94% on incomes above $200,000.
Rates have generally been falling since 1964 when the top rate was lowered to 70%.
Dark days for America surely. I well remember the bread lines and economic devastation of the 1950s and early 60s. It’s amazing corporate American was even able to function with CEOs only making an (inflation adjusted) 1.2 million vs 12 million today. Good things those dark days are behind us.
I have two grown kids in NYC. They’ve hung in there, but the gig economy has dried up and they don’t have a lot of work. They did have savings, and they can weather the storm for a while….but they are both jazz musicians by training and inclination, and that world has changed. Both of them worked at the Village Vanguard until COVID. It’s been closed for six months I think.
I also have two others in Chicago, which does not seem to be quite so hard hit. Both of them are artists, All these kids are in their 30’s really just getting into the swing of life…..they will get through this, but it doesn’t make it any easier…in world that has already been pretty tough on them.
My friend just listed his condo in the financial district – he’s pricing it 10% higher than his cost from 2006. It’s $4K per month in taxes and common charges, which is a lot but, and this is the issue for NYC, I’ve seen much higher.
The population of Rome declined from more than 1 million to around 20,000 after 475 A.D.
There is no rational reason to expect anything other than similar results here.
Let’s get one thing straight. The mayor doesn’t control the nyc income tax rate. It gets set in Albany. Same with the sales tax. This 90% rate ain’t happening. You’re silly to discuss it. NYC controls the real estate tax and that’s it
Let’s get one thing straight.
I know the mayor cannot taxes. That was a “what if kind of thing”. and yes he would if he could.
And progressive nutcases across the board would if the could.
And it is not nuts to discuss it. Because that is what they all want.
Are you drunk?
Are you
Other than state income tax and a few others, doesn’t the local city/county commission set property tax rates and additional sales tax to fund local schools and such?
New York must seek permission from Albany to raise the income or sales tax. Only the real estate tax is fully under its control. i think they can control fines, like for speeding or double parking
As a New Yorker I’m used to these stories. We get them every few years but a few things are worrisome.
Incompetent mayor. More homeless etc
Rising costs for people in high rise apartments. Insurance, tax and labor costs all increasing at rates far above CPI.
companies allowing remote workers mean you can live someplace cheaper. If you are working from home and the kids are there too that small apartment is now more of a problem
People employed in restaurants, travel, entertainment etc are not making money. If there’s one thing worse than rising expenses it’s a declining income
“We get them every few years but a few things are worrisome. “
Now it’s worrisome but silly to discuss.
Get sobber.
“sober” i was going to ask you that question. maybe a dictionary?
Oh…and besides a lower cost of living, much better access to better healthcare in Cuba. Don’t know about Venezuela though on that front.
Maybe they should consider moving to Venezuela or Cuba. Except for illegal U.S. sanctions and threats of illegal military invasion & attacks & regime change, cost of living is super cheap. Telecommute to work and live at 1/1000th the cost.
Illinois rates were not progressive. Lower incomes were actually paying more per dollar. Looks like they are about to reverse it so that higher incomes pay more.
It will be interesting to see where all these people end up. Can Florida or Texas handle a population of 35-40M ? I’m actually glad people are leaving California because I think there is an upper bound on the number of people who can live here based on how many forests there are and how much traffic. I grew up in Texas when there was quality of life there. Now there are too many people already but more are moving there everyday. Property taxes in Texas keep rising to make up for lack of an income tax. They keep building more low quality housing as far as the eye can see because the terrain does not limit anything. Everything seems possible until it isnt.
I believe the upper bound for CA is water. There is plenty of land, but only so much water. Tapping into essentially irreplaceable aquifer water is a bad idea.
Take out the mountains and forests and the land is limited. No one will keep living close to forests to the point their abodes repeatedly burn down. Houses on sides of hills are also at risk.
I too grew up in Texas…in a time that was so different than now…..that it seems like another world. It was another time, back when we had small towns and local businesses.
I’m still here, but I gravitated to Austin in the late 80’s and I’m pretty dug in. The taxes are getting pretty sucky, but there is plenty of high quality housing here….and people moving from the west coast generally leverage their equity into a much nicer place.
Apple is still building their new campus. Tesla is building a factory out by the airport. I expect that we will blow through the 35M population mark in Texas before I take the dirt nap…..no problem.
I will sell my house in a few years to some lucky Cali transplant for 4X what I paid for it and move out to the lake, most likely.
Illinois rate are indeed progressive. If you take any number of deductions from your income the state allows you, then you also get multiple $1000’s in standard deductions for you, your spouse, etc…..you wont pay any tax on those amounts. THEN there is one rate across all taxable income. So if you are a low income, or retiree, and take any number of deductions the state wants you to spend money on….you will pay a lower EFFECTIVE rate than someone in a higher income situation. Granted, its not as “progressive” or steep as some liberals would want, but it is progressive to a degree.
Also, the change they are trying to make to the constitution to allow multiple rates requires a 60percent on the question or 50percent of all ballots cast to pass….its not going to. If the Illinois assembly would have paired this with an amendment to reform the pension systems in the state….it would have passed easily. Without the pension reforms, Illinois is a zombie state and only getting worse…..tax increase or no.
I for one will leave if this thing passes…. That will be the last straw for me. Plenty of red states that are more tuned into their citizens, and dont look at them as tax pigs going to daily slaughter.
Texas could become another California with higher taxes, traffic and homeless if people keep moving in droves.