Why Smart Millennials are Now Moving West to America’s New Economic Hot Spots

“Washington is not a place to live in. The rents are high, the food is bad, the dust is disgusting and the morals are deplorable. Go West, young man, go West and grow up with the country,” said famous American newspaperman and politician Horace Greeley in 1865. 150 years later, Greeley’s advice to disgruntled D.C. civil servants might be more valuable than ever.

Cities west of the Mississippi are drawing educated, young workers and generating economic growth powerful enough to even break the records set before the crisis of 2008 put a chokehold on the nation’s wallet.

According to the research of Kenan Fikri, a senior policy analyst at Washington’s Brookings Institution, where the country’s economic future is concerned it isn’t the old northeastern powerhouses — historically focused on finance and manufacturing — that will carry the banner.

Fikri focuses on the so-called “advanced industries” sector, a collection of STEM-intensive areas with significant growth potential including aerospace, computers, and even the automotive industry.

In February, Fikri released data showing that of the nation’s top 20 large metro areas where advanced industry employs the biggest slice of the workforce, 13 were in the West, and only three (Boston, Detroit, and Connecticut’s Bridgeport) could be found in the country’s traditional industrial heartlands.

The trend appears due in no small part to the migration of millennials. Brookings’ analysis of U.S. Census data shows that among the top 10 cities with the largest annual net influx of residents 25-34 for the period 2010-13, nine overlap with those on Fikri’s advanced industries list. “The decline in manufacturing in the East, combined with an increase in service and technology jobs, is moving the country’s economic gravity westward,” Fikri recently told Bloomberg News.

Topping the 2010-13 list as a target area for young people was Houston, with an annual average of 12,400 new 24-34 year olds, but progressives San Francisco and Denver weren’t far behind, tied with 12,000 yearly, each.

Another enticement for areas with concentrated advanced industries are the wages. While general wage stagnation has long been a thorn in the sides of those wanting to assert that the economy has recovered, the advanced industries sector has routinely bucked this trend. Another recent Brookings report noted that the sector has shown an adjusted wage growth of 63% for the period of 1975-2013, contrasted with 17% outside of it. Furthermore, these high wages aren’t limited to those with higher education credentials — greater than half the workers in the sector possess less than a bachelor’s degree, and those with this level of education have earnings that far exceed their parallels in other sectors.

A general analysis of wage growth by state also bears out the western expansion trend. For 2009-14, Washington, California, Oregon, Texas, Utah, Colorado, Oklahoma and both Dakotas comprised the top 20% of states for wage increases enjoying rises between 3.61-11.45%. Of all the states east of this territory, only Massachusetts showed great enough gains to make it into their league.

While traditional power centers remain in their frontrunner positions economically — Boston, New York and Washington together support a $3 trillion dollar economy — they may come with liabilities more than just the weather to push young workers westward. As Fikri puts it, “Compared to eastern cities, those in the West don’t have the economic baggage that comes from an industrial legacy.” In the period since 2008, as cities like Portland and San Jose have enjoyed GDP growth of 22.8% and 20.3%, respectively, New York has only seen a gain of 6.3%.

While the Great Recession isn’t quite out of America’s rearview mirror and long-term trends aren’t yet set in stone, the immediate data indicates that young people are voting with their feet, and if the pattern continues, it could be landslide victory for that classic American tradition of packing up and heading west in search of success.