Marion County lost nearly $490 million when people left during COVID

Migration out of Marion County between 2020 and 2021 caused a nearly $490 million drop in adjusted gross income — while surrounding counties saw a simultaneous increase.

• The biggest winners were Hancock County, which had a 4.4% or $76 million increase, and Boone County, which saw a 3.4% increase amounting to $69 million, according to a new analysis of tax data from the Economic Innovation Group, a nonpartisan think tank.

Why it matters: Nearly half of Marion's tax revenues come from income tax, according to a city analysis.

• Plus, the economy depends on residents' incomes to support the local housing market and retail sales.

The big picture: When millions of Americans rethought their living situations during the COVID-19 pandemic, their moves changed the geography of where money is made in the U.S.

• The analysis quantifies why some of America's biggest cities are struggling to rebuild their economies post-pandemic.
• Not only did people leave the biggest cities, but those who left had disproportionately high incomes — meaning the hit to the local economies was larger than migration numbers alone might imply.

Between the lines: Monroe County, where Bloomington is, and Vanderburgh County, home of Evansville, also saw drops in income during the same time period, while their surrounding areas also saw increases.

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.