Iowa State University
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News Service

News Service:

Annette Hacker, director,
(515) 294-3720

Office: (515) 294-4777

02-23-09

Contacts:

David Peters, Sociology, 515-294-1122, dpeters@iastate.edu

Sara Kaplan, Sociology, 515-294-5154, sarak@iastate.edu

Dan Kuester, News Service, 515-294-0704, kuester@iastate.edu

Iowa out-migration stalls while income numbers drop, says ISU researcher

AMES, Iowa -- Over the last few years, Iowa has had roughly the same number of people move into the state as move out.

But lately, the people moving out have taken with them higher paying jobs.

David Peters, an assistant professor of sociology in Iowa State's College of Agriculture and Life Sciences, and sociology researcher and graduate student Sara Kaplan have examined Internal Revenue Service income tax return data from the last 15 years and used that information to track the flow of population and income in and out of Iowa.

Until recently, Iowa had been losing some people in good economic times and many more in bad economic times, Peters said. Lately that has changed.

"The net outflow of people has really stabilized," he said.

"In the late 1990s, when the economy was booming, we had sizable outflow of 5 or 6 thousand a year.

"In the last recession in 2001-02, Iowa really hemorrhaged people," he said. "We saw almost 10,000 leave in a single year."

Since 2004-05, the number of residents leaving Iowa has slowed to fewer than 2,000 annually. In 2006-07, Iowa had a net increase of around 500 people migrating in. This was the only year Iowa had a net gain during the 15 years examined by the study.

While the number of people coming and going has remained fairly constant, the disturbing trend is that the people leaving are those earning high wages.

"At the height of the technology boom, the average per capita income of each of those persons leaving the state was about $50,000 per year," Peters said.

"By 2007-08, even though we had only lost about 700 people, those people took with them over $300,000 in income per person," he said. "That is losing a lot of income."

As the current recession lingers, Peters will be interested to see if out-migration begins to increase as it did during earlier economic downturns.

With population remaining almost constant and a good deal of income leaving, there are implications for taxes and consumer spending, according to Peters.

"If the number of people and income leaving remains steady, the tax impact is minimized as state and local government can provide fewer services," he said. "However, if the number of people remains steady and more income leaves, then each person remaining has a larger tax burden as government still has to provide the same services but with a smaller tax base."

Most people moving into Iowa came from foreign countries and other states in the Midwest, with a lot of gains from Illinois. Iowa also had gains from Los Angeles and Colorado Springs, Colo. Many of these out-of-state newcomers settled in metro Iowa, especially in Des Moines, Cedar Rapids, Dubuque and Davenport, but they also settle in smaller, rural areas in Winneshiek and Jefferson counties.

Minneapolis and Phoenix were the most popular destinations for people migrating out of Iowa as well as locations in the South. Border counties around Sioux City and Sioux Falls, S.D., as well as Omaha, Neb., also gained from Iowa's out-migration. South Dakota has no personal income tax.

One county that gained from Iowa's losses was Berrien County, Mich., which contains no major cities. Kaplan thought it to be an odd place for former Iowans to settle. As it turns out, there may an explanation for it.

"We did a little bit of detective work, and found Whirlpool's Benton Harbor headquarters is located there," said Kaplan.

"The largest outflow of people to this area in Michigan was from Jasper County, Iowa, home of Newton and the old Maytag headquarters," she said.

In 2006, Whirlpool Corp. acquired Maytag Corp.

Upon request, the sociology department can run more specific reports for each county as a tool to better understand target demographic populations and help with possible recruiting efforts.

The complete report is at www.soc.iastate.edu/news/migration.html.

population map

income map

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Quick look

The number of people coming and going has remained fairly constant, but the people leaving are those earning high wages.

Quote

By 2007-08, even though we had only lost about 700 people, those people took with them over $300,000 in income per person. That is losing a lot of income.

David Peters