Following the Money into and out of Baton Rouge
BR By the Numbers takes one more look at IRS migration data to figure out where the highest average income earners are both coming from and going to
[Part 3 in a BR By the Numbers series on Capital Region migration patterns]
Income serves as an important indicator for understanding which skills are highly valued in the labor market. Doctors generally make more than retail workers because the skills held by doctors are more highly valued by employers than those held by retail workers. Because BRAC is working hard to better retain our region’s talent, including those with the most highly valued skills, understanding where our region’s most well-compensated talent both comes from and goes to can help us be more strategic in our talent recruitment and retention efforts.
In the final installment of this BR By the Numbers series on Capital Region migration patterns, we return to IRS migration data to look at average adjusted gross income flowing into and out of the Capital Region. Two weeks ago we looked at the number of households moving into and out of the Capital Region based on the number of tax returns filed. Another valuable data point provided by the IRS is the sum of adjusted gross income (AGI) flowing from one county to another. This is determined by summing up the incomes reported on tax returns for those migrating from “County A” to “County B.”
BR By the Numbers took these figures a step further so that we could rank counties and parishes by a) which ones are supplying Baton Rouge with highly valued talent, and b) which ones are attracting Baton Rouge’s highly valued talent. Taking the sum of adjusted gross incomes for particular counties and dividing by both the number of returns and exemptions1 filed for that same county, we can determine each county’s average income per household and per individual. These rankings are helpful for understanding where highly valued talent in the labor market is going to and coming from. Our findings are organized into four tables in the following order:
Highest Income Households Moving to Baton Rouge
Highest Income Households Leaving Baton Rouge
Highest Income Individuals Moving to Baton Rouge
Highest Income Individuals Leaving Baton Rouge
More high-income households come to Baton Rouge from Cook County (Chicago) than Jefferson County (Beaumont)
Many of the households with the highest average incomes moving to Baton Rouge come from outside Louisiana. Households from Fort Bend County, a suburban county southwest of Houston, moved to the Capital Region with, on average, $86,570 in household income. Large urban Texas counties are featured here (Harris and Dallas) as are several suburban Texas counties (Fort Bend and Collin). Louisiana parishes are highlighted in the tables below.
Baton Rouge appears to be a popular destination for high income households moving from Cook County. More households moved to Baton Rouge from Chicago’s central urban county than from half the counties included above. Surprisingly, more households moved to Baton Rouge from Cook County (238) than from Bossier Parish (202), which ranks just below Dallas County with an AGI/return of $54,109.
Perhaps the most important takeaway from this table is the sheer amount of income that movers from Harris County (Houston) bring with them to Baton Rouge, especially when compared to other counties with high average income emigrates. Households arriving from Harris County brought with them over $165 million in adjusted gross income over the six years studied. Tangipahoa Parish was the only county that brought in a higher total AGI ($187 million), but it took them more than twice as many households to do it (4,595).
Popular destinations for high AGI households leaving Baton Rouge include Houston, North Carolina, and Florida
Households leaving Baton Rouge for Montgomery County (The Woodlands) north of Houston earned, on average, $126,672 annually. Four of the ten counties that attracted the highest average earners from Baton Rouge were in the Greater Houston area, while just one Louisiana parish (St. Tammany) ranked among the top ten.
Comparing high AGI households moving to Baton Rouge versus those leaving, it’s clear some trends emerge. High AGI households moving to Baton Rouge typically come from urban and suburban counties from nearby Texas metros (Houston, Dallas, Beaumont) or from urban counties from other nearby major metros (Atlanta and Memphis). High AGI households leaving Baton Rouge find new homes across the Greater Houston metro as well as in Florida (Tampa and Pensacola) and in other popular, growing metros (Charlotte, Nashville, and Raleigh).
Baton Rouge attracts large numbers of high-income individuals from some of the nation’s most populous counties
Almost 1,000 individuals from the two most populous counties in the nation (Los Angeles and Cook) moved to Baton Rouge from 2014 to 2020, bringing with them some of the highest average incomes when compared to other counties/parishes. Similar to households discussed above, individuals from nearby Texas metros (Houston, Dallas, Beaumont) moved here in large numbers and often brought higher AGIs with them.
Three Louisiana parishes rank in the top ten for high AGI individuals moving to Baton Rouge compared to just two Louisiana parishes in the top ten for high AGI households moving to Baton Rouge. These trends make it clear that both households and individuals with high incomes moving to Baton Rouge are more likely to arrive from out-of-state.
Metros with national appeal are likelier destinations for high income individuals leaving Baton Rouge
Some of the most popular metros for young professionals in the country are high on the list for high AGI individuals leaving Baton Rouge including Charlotte, Nashville, Washington D.C., Denver, and Seattle. Three Houston counties are included here as is one Louisiana parish.
High income individuals leave Baton Rouge for counties in the Greater Houston area in much larger numbers than other counties across the nation. Regardless, this data supports the narrative that some of the most sought-after talent in the labor force is leaving Baton Rouge for a select group of metro areas across the country.
That’s a wrap (for now) on migration
This post wraps up our series on Capital Region migration patterns. Underlying this series were a few key data points. Baton Rouge has:
32,163 job postings (May 2022)2;
13,152 unemployed workers (April 2022)3; and
55,000 college students enrolled in regional 2- or 4-year institutions (Fall 2021)4
This series taught us a couple important things. People from other Louisiana parishes move to the Capital Region in high numbers. People from the Greater Houston area and other Texas counties also move here in high numbers, often bringing with them higher incomes. Baton Rouge is also a draw for higher average income individuals moving from urban counties in large cities like Chicago and Los Angeles. These are important facts to understand as our region attempts to better target future talent attraction efforts and fill some of Baton Rouge’s tens of thousands of open jobs.
BRAC’s holistic talent recruitment and retention strategy involves continued improvements on a range of issues affecting us all, from primary and secondary education to quality-of-life initiatives. After a successful legislative session in which BRAC contributed to significant progress in areas like traffic alleviation through funding for a new Mississippi River bridge and K-12 computer science education, it’s clear our community is already working towards solutions that will help our region recruit and retain crucial talent.
Guidance from the Internal Revenue Service indicates that the number of “returns” filed can be used to estimate “households” and the number of “exemptions” can be used to estimate the number of “individuals.”
EMSI Labor Analytics
Bureau of Labor Statistics
BRAC analysis of enrollment numbers for Capital Region higher education institutions