Blog #92 Massachusetts economy crashes as state loses domestic residents, gains migrants
By LANCE REYNOLDS | lreynolds@bostonherald.com
UPDATED: February 14, 2025 at 2:24 PM EST
A Boston-based think tank says the state economy is crashing as the Massachusetts population records “historically high” gains in “low-skilled migrants, many lacking legal status” while domestic residents flee.
The Pioneer Institute has warned state officials to be wary when looking at last year’s Census Bureau estimates that showed Massachusetts’ population had its largest growth in over half a century.
The institute has released a report pointing to the Bay State’s population growth of 69,000 in 2024 – the largest increase in 60 years – driven by a change in census methodology “designed to better capture the influx of humanitarian migrants.”
Massachusetts gained 69,603 residents between 2023 and 2024, but an “astounding” 90,217 international migrants helped offset a “loss” of 27,480 domestic residents, according to Census estimates. The figures also include a gain of 6,718 residents from natural population changes, in births and deaths.
The UMass Donahue Institute issued a report on the Census data last month, but the Pioneer Institute has claimed its analysis is a “more nuanced look at the data, including how a change in the Census Bureau’s methodology significantly impacted their 2020–2024 estimates.”
In a release this week, Pioneer highlighted how state Secretary for Economic Development Yvonne Hao reacted to the Census data positively, expressing “great confidence that we are heading in the right direction.”
Pioneer Executive Director Jim Stergios is urging caution with that mindset.
“State leaders should not read too deeply into trendlines drawn from estimates, which are in turn based on changed definitions of Census data,” Stergios said in a statement. “For years, Massachusetts was recognized nationwide as a magnet for capital and talent. Now we are not, so we need our leaders focused on addressing the reasons why wealth and talent are heading for the exits.”
The Census Bureau shifted its estimate approach, incorporating “Office of Homeland Security Statistics and U.S. Refugee Admissions Program administrative data on border encounters and Refugees to supplement the ACS.”
In the past, the bureau “relied primarily” on the American Community Survey which “asked foreign-born respondents if they lived abroad a year ago.” Data is a year behind and surveys struggle to pick up “humanitarian migrants: refugees, asylum seekers, and others who are on humanitarian parole or are in the country illegally,” the Pioneer Institute states.
The methodology switch led to a “historically high net international migration estimate for 2024” and “significant upward revisions for the 2020-2023 estimates.”
Bureau officials recorded a difference of 54,000 in 2023 and 2024 estimates for the 2022 and 2023 calendar years. From 2020 to 2024, the Bay State took in 255,102 new immigrants, more than double the average for all states.
“Unfortunately, the revised estimates aren’t as positive as they appear,” said Aidan Enright, author of the Pioneer report issued this week. “In terms of economic impact, humanitarian migrants can’t make up for the domestic out-migration of residents who tend to be younger and more affluent.”
In particular, Massachusetts’ overall population grew by 22,000 in 2022, but “the IRS still found that Massachusetts lost nearly $4 billion in adjusted gross income from net out-migration that year.”
Enright pointed to how “net international inflow is likely to revert back to historical norms in the coming years” with President Trump’s crackdown on illegal immigration.
Business coalition Mass Opportunity Alliance, which Pioneer is part of, provided results to a survey of 498 former Massachusetts residents who now live in Florida or New Hampshire on what caused them to relocate.
Tax policy proved to be the most-cited factor causing out-migration while “a vast majority of respondents” said their current quality of life is better than in the Bay State. Two-thirds of those who moved said Massachusetts became too costly with housing, taxes, groceries and other expenses.
“While there have been some ‘bright spots’ of progress,’” Enright wrote in his report, “Massachusetts’ policy environment over the last decade has left a lot of room for improvement.
“A short-term surge in low-skilled migrants,” he added, “many lacking legal status or the ability to work in regulated sectors, is no reason for policymakers to think they have solved the out-migration crisis, which has always been about losing wealth to invest here and the talent that makes economic success possible.”
Originally Published: February 14, 2025 at 5:56 AM EST