Categories
Data Releases

IRS: Davidson County among national leaders in attracting residents from out of state

Davidson County was among the leaders nationally in attracting residents from out of state in 2017-2018, according to new data from the Internal Revenue Service (IRS).

Nearly 17,000 households representing an estimated 25,000 people (see methodology below) moved to Davidson County from other states in 2017-2018, accounting for the majority of all US-based moves to the county (61%). Davidson County’s net gain, or inflow-outflow, of an estimated 3,358 households from out of state ranked 16th among the 100 largest counties in the country. Maricopa County, AZ (Phoenix) had the largest net gain in households at 21,267, followed by Clark County, NV (Las Vegas) at 15,628, and King County, WA (Seattle) at 10,718. Denver and Wake County (Raleigh) rounded out the top five.

Since nominal change tends to favor large counties—i.e. more people, more moves—it can be helpful to normalize the data to account for differences in total population. Looking at net migration of households from out of state relative to total population, Davidson County jumps up to #7 (Denver is first). In other words, people moving to Davidson County from out of state are having a more significant impact on the size of the overall population here compared to the impact of out-of-state migration in most other large, growing counties.

Where are people coming from?

In terms of migration the top “donor” states to Davidson County ranked by inflow of households (with a minimum of 500) in 2017-2018 were:

  1. Florida 1,206
  2. California 1,152
  3. Texas 847
  4. Illinois 761
  5. Georgia 611
  6. New York 598
  7. Alabama 547
  8. Kentucky 508

In net terms (inflow-outflow) Davidson County gained the most households from Illinois (446), California (367), and Florida (337).

The top ten donor counties to Davidson County were:

  1. Rutherford County 2,183
  2. Williamson County 2,045
  3. Sumner County 1,239
  4. Wilson County 1,022
  5. Shelby County 606
  6. Montgomery County 481
  7. Cook County (IL) 465
  8. Los Angeles County (CA) 437
  9. Robertson County 364
  10. Cheatham County 344

The top ten donor counties from out of state were:

  1. Cook County (IL) 465
  2. Los Angeles County (CA) 437
  3. Fulton County (GA) 239
  4. Harris County (TX) 201
  5. Dallas County (TX) 197
  6. Jefferson County (AL) 181
  7. New York County (NY) 166
  8. San Diego County (CA) 160
  9. Maricopa County (AZ) 158
  10. Kings County (NY) 158

Nearly one out of every five households moving to Tennessee from other states went to Davidson County, followed by Shelby County (13%) and Montgomery County (8%).

Methodology

The IRS publishes annual data showing the number of tax returns, exemptions, and total adjusted gross income reported in each state and county and then matches addresses in consecutive years of filings to identify migrants. Analysts use these returns to estimate households and exemptions to estimate people, but they are not matched 1:1.

For example, multiple returns can be filed from the same address, and not all exemptions are people. Generally, returns are a more accurate proxy for households than exemptions are for people, which is why most analysts focus on returns when reporting the data. Time periods are expressed in hyphenated years (e.g., 2017-2018) due to tax filing deadlines. The 2017-2018 data set includes reported income earned in Tax Year 2017 only but could reflect a move in 2018 during the filing period for most returns, January-April 15, 2018. Since a move could occur at any time between when the Tax Year 2016 return was filed and when the Tax Year 2017 return was filed it must be expressed as two hyphenated calendar years.

Finally, not everybody is required to file a tax return, meaning the IRS data does not reflect the total population. Please see the user guide posted on the IRS website for a more detailed explanation of data limitations and appropriate interpretation.

Categories
Data Releases

Health care added nearly $11 billion to Nashville economy in 2018

The health care industry added nearly $11 billion to Nashville’s economy in 2018, according to newly available county-level statistics from the Bureau of Economic Analysis (BEA).

Nashville’s health care industry accounted for $10.996 billion in value-added to Davidson County’s gross domestic product (GDP) in 2018, according to my analysis of BEA’s data, or about $1.50 out of every $10 in total economic value. Health care is 15.3% of total GDP in Davidson County, which ranks first among the largest 100 county economies in the U.S., followed by Bronx (15.1%), Nassau (14.8%), and Kings (13.0%) in New York.

Health care’s inflation-adjusted growth rate of 2.8% in 2018 trailed the Nashville economy overall (4.6%), but the industry’s real value has more than doubled since 2001. Of counties with a health care industry valued at $10 billion or more, only Maricopa, AZ (Phoenix), and Santa Clara, CA, surpassed Davidson’s real growth rate (105%) during 2001-2018.

County-level GDP data is an important milestone for federal statistics programs, especially for counties, like Davidson, belonging to very large metropolitan statistical areas (MSAs), where parsing county-level trends is difficult. Jobs data has been available at the county level for a long time but provides only one indicator of local economic activity. Analysts have been lobbying for publicly available, county-level GDP data for quite some time.

So, on behalf of local analysts and economic developers everywhere, thanks to BEA for this important contribution to our understanding of local economies.

Categories
Economic Development

Nashville: We need a common set of facts about equity and inclusive economic development

Equity is having a moment in Nashville. David Plazas is calling on business leaders to make a commitment to more inclusive growth and prosperity. Metro Council is passing symbolic resolutions. Mayor Cooper is promising a Nashville that works for everyone. How all of that goes from rhetoric to meaningful action remains to be seen, but declarative statements are a start. Two lines, in particular, caught my attention in Plazas’s piece:

“The prosperity of recent years has disproportionately benefited people with higher incomes, who own property, and who have technical or higher-level skills.”

“Meanwhile, wages have stagnated or fallen for long-term lower-skilled workers who have struggled to keep up, especially people of color.”

I’ve heard different versions of those points made many times since I arrived in Nashville two years ago. Anecdotal evidence abounds about where the benefits of “New Nashville” are accruing, and how growth is exacerbating the gaps between newcomers and existing residents, the “haves” and the “have nots.” But what does the data say? Are those claims accurate? And do they tell the entire story?

To be clear, I hope that Plazas and advocates continue to push our elected leaders to keep equity front and center of debate about economic development in Nashville. When Metro and its various stakeholder groups decide they are ready to have a serious policy, and not just tinker around the edges, I hope that equity will be its cornerstone. There are many good examples from other cities to draw from, including what we adopted in Austin.

But if and when that day comes we’ll need more than testimonials and anecdotal evidence. Clearly articulating goals, developing strategies, and evaluating progress will require data and a serious commitment to open dialogue, transparency, and accountability. As with any public endeavor, everybody gets a say; all experiences are valid. But Very Serious People should not go unchallenged publicly because of what I’ve heard described as “Nashville Nice” or some distorted view of defining “politics” as one’s inalienable right to dissemble when facts are readily accessible. This was part of our motivation behind launching the resident survey and publishing the data on Metro’s open data portal. I hope the Cooper administration and new Metro Council continue down that path.

So, in that spirit, let’s take a look at Plazas’s points. We’ll combine them here since they are somewhat related and restate the issue as follows: Are the benefits of Nashville’s economic growth disproportionately accruing to people equipped with the tools (i.e. education, skills, etc.) to take advantage of it? And, if so, is that exacerbating inequality? I can’t say for sure how Plazas would define or measure “benefit[ed],” but since he used terms such as income and skills it’s probably safe to assume that he was thinking, at least in part, about workers. Which means the question becomes: Have wages “stagnated or fallen” for workers with lower levels of educational attainment compared to those with higher levels?

Here’s a table showing growth in inflation-adjusted (real) average earnings for workers age 25+ in Davidson County by educational attainment and race/ethnicity for 2011-18. The data is from the Census Bureau’s Longitudinal Employer-Household Dynamics program.

Average earnings for workers in Davidson County with no postsecondary education grew faster than any other cohort during that time period. In fact, average earnings for workers with no high school diploma or GED grew about three times faster than average earnings for workers with a bachelor’s or advanced degree, according to Census estimates. Clearly, Nashville’s recent period of economic growth has produced gains for workers across the spectrum of education and skills, not just at the top of it.

But I don’t think that’s what Plazas was really trying to say. I think his point was directed more toward issues of equity and affordability–and, in that context, he’s absolutely right. Housing experts tell us that we should spend no more than 30% of earnings on housing costs to be considered affordable. Do that calculation using the 2018 figures in the table above and Plazas’s argument comes into focus. For example, average earnings for Black workers in Davidson County are equivalent to about $1,000 in total monthly affordable housing costs. The average rent in Nashville now exceeds $1,400 per month.

It’s the same story for Hispanic workers in Davidson County, as well as workers with no completed postsecondary education, on average. And the gaps are growing. Inflation-adjusted average rent in Nashville increased by 40% in 2011-18, compared to average earnings growth of only 5% for Black workers in Davidson County.

This is where the debate about inclusive economic development in Nashville, or any fast-growing city for that matter, should start. What combination of policies and strategies are going to effectively address these challenges resulting from economic success? In fact, we had a similar conversation in Austin this week with a group from Grand Rapids.

As any of my former students can attest, I feel very strongly–and very likely annoyingly so–about the importance of a call to action when developing a strategy. It’s an often overlooked feature in practice. But if you don’t have a compelling call to action it can be really difficult to get people engaged and participating in a serious way.

I’ll offer this for Plazas’s next one:

In 1998, when Nashville was a much different place, Black workers in Davidson County earned, on average, about 66% that of White workers. Today, despite twenty years of economic growth and opportunity, it’s 59%.

Categories
Politics

My two cents for Mayor-elect John Cooper

Congratulations to Nashville Mayor-elect John Cooper, who won the runoff with nearly 70% of the vote last week. The word is he may be open to some input on what the priorities should be for the next four years. While, admittedly, my usually steadfast objectivity could be a bit compromised in this case, here’s my two cents for what it is worth to them.

First, when it comes to priority setting, luckily they don’t have to rely on my objectivity. In 2018 we launched Nashville’s first recurring, random-sample resident survey, a performance management tool most communities of this size have had in place for a long time. The survey collects data from 400+ households each quarter (MOE +/- 5 on a quarterly basis and +/- 2.5 on an annual basis) and results are posted on Metro’s open data portal for public use.

The usual suspects–public education, police, affordable housing, streets and sidewalks, and public transportation–are consistently represented as high priorities, but note some of the differences in rank order and value across groups. For example, respondents who have lived in Nashville for less than five years are nearly twice as likely to say that public transportation should be Metro’s highest priority compared to respondents who have lived here for twenty or more years. Despite making up the majority of WeGo ridership, only 6.0% of low-income (< $30,000) respondents and 4.7% of black respondents think that public transportation should be Metro’s highest priority. Affordable housing, by contrast, gets 26.6% and 32.6%, respectively.

None of that likely comes as a surprise to transit advocates or political candidates and campaign staff with access to expensive polling data. But polling data isn’t usually in the public domain and open to scrutiny; thus it can’t provide the common set of facts needed to openly debate and reach consensus on controversial issues. I’m hoping Mayor-elect Cooper is serious about pushing Metro, and the city, in this direction. Increasing Metro’s investment in the resident survey to get a large enough sample for council district breakouts would be a good start.

Second, there needs to be more public engagement in Metro’s budget process. There’s a question on the resident survey about satisfaction with Metro’s budgeting and stewardship of public funds. The campaign rhetoric from Cooper’s side painted a dire picture of majority, widespread discontent on that front. In reality, 41% of respondents are dissatisfied with Metro’s management of public funds, according to the survey. Now, while 41% is not a majority, it is significantly higher than the 19% of respondents who are satisfied, so, you know, well-played and all. But that leaves 40% who say they either don’t know or are neutral on Metro’s financial management–and that’s an information gap that shouldn’t be wide enough for politicians to exploit. But it was a smart strategy. The column in the table above marked Highly Engaged includes respondents who have contacted a Metro elected official and attended a public meeting in the last year. This gets to the difference between political polling focused on voters and performance management surveys focused on all residents, but it’s probably safe to assume that the Highly Engaged crowd generally maps to voters. They are 20% of the survey sample and 58% of them are dissatisfied with Metro’s financial management.

We need to reverse that trend. Engagement should yield more confidence in Metro’s budgeting and stewardship of public funds, not less. There are several approaches worth considering. The City of Austin, for example, starts holding community meetings several months in advance of the proposed budget. Check out this summary of Austin’s FY 2019 budget engagement process and consider how it compares to Metro’s standard approach. Other communities have experimented with participatory budgeting. Results are mixed, but it’s worth considering in Nashville. It would be a logical next step in the evolution of nonprofit direct appropriations and the Community Partnership Fund.

Finally, Metro and the city of Nashville need an economic development strategy. We touched on this in our meetings of the Tax Increment Financing Study and Formulating Committee, but it was a bit outside the narrow scope of that effort. To be clear, Metro’s economic development staff is, and has been, top-notch. They are professionals in every sense of that word. But we are deploying subsidies–the “tools in the toolbox”–without a clearly articulated, consensus position on what we are trying to accomplish. In strategic planning terminology, we are deploying strategies (the how) without clearly defined goals (the what), and we’ve entirely skipped over the call to action (the why).

We have to fix that by engaging the community to help develop clearly defined, measurable goals for inclusive, equitable economic development that improves living standards for residents. That should be the goal. I’d encourage Mayor-elect Cooper to check out Austin’s economic development policy. We revamped it about ten years ago to include a publicly available cost-benefit analysis of every proposed deal–a common set of facts–and multiple opportunities for the community to weigh in before a contract was approved. It even earned an award for transparency from a leading anti-subsidy advocacy group, Good Jobs First. Restoring trust starts with transparency.

Congratulations, again, to Mayor-elect Cooper and his team. Here’s to a more data-driven Nashville.

Categories
Fact Checks

The Music City is not adding 100 people per day

From CityLab yesterday on Why Nashville Can’t Quit Country Music:

“Thanks to a surging economy and an onrushing hot-city rep, the Music City has been gaining about 100 new residents a day.”

Not really.

The “100 people per day” is a wonderful talking point for realtors and others leveraging growth to serve a special interest or to support a political argument. But it’s not true, or, to be more accurate, it’s not defensible using publicly available data. Ditto, Austin.