Pandemic in-migration made Colorado richer, but Denver lost money
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Colorado's mountain counties became richer during the pandemic, as Denver took a hit.
Driving the news: From Routt south to San Miguel down the Continental Divide, counties saw their taxable income increase significantly with the in-migration of people from the Front Range and out of state, according to the analysis of tax data by the Economic Innovation Group, shared first with Axios.
- San Miguel, home to Telluride, and Pitkin, home to Aspen, saw adjusted gross income rise nearly 30% from 2020 to 2021, more than all other localities.
Why it matters: Income taxes are a major source of revenue for the state and some localities.
- But even places that don't have a local income tax depend on residents' incomes to support the local housing market, retail sales and the tax base.
By the numbers: In dollars, the largest gains came in existing rich counties.
- Douglas saw taxable income increase by $471 million, and Boulder County jumped by $287 million.
Yes, but: At the same time, Denver saw a population decrease and its taxable income tumble 2.3%, or $372 million.
- It's the largest decline in Colorado.
The big picture: When millions of Americans rethought their living situations during the pandemic, their moves changed the geography of where money is made in the U.S., Axios' Neil Irwin writes.
- The data quantifies the reasons some of America's biggest cities are struggling to rebuild their economies post-pandemic and shows a surge in income that arrived in many rural and exurban places and in popular vacation destinations.
- Not only did people leave the biggest cities, but those who did disproportionately had high incomes, meaning the hit to those local economies was larger than migration numbers alone would imply.
What they're saying: "The scale of urban income flight is a lot larger than I thought it would be," said Connor O'Brien, who conducted the analysis at EIG.
- "It's very likely that the last couple of years in superstar cities, high earners have become more mobile, while everyone else has been stuck."
What's next: The data only runs through 2021 — but, based on other evidence, the trends may have eased but not reversed, O'Brien said.