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Connecticut lost $1.1 billion in wealth to other states in 2018

Connecticut ranked 6th in the nation for loss of wealth to other states between 2017 and 2018, with a net loss of $1.13 billion in adjusted gross income as people moved out, according to figures released by the Internal Revenue Service.

Where is all the money going? Florida, mostly. The Sunshine State has been drawing Connecticut residents consistently for years and, over the course of 2017, accounted for $922 million of Connecticut’s total loss of gross income.

Connecticut also saw a net loss of $157 million to Massachusetts and $149 million to North Carolina. 

Connecticut did gain more than $1 billion in wealth from New York as people moved across state lines, but it was not enough to prevent the overall loss, which amounted to .7 percent of Connecticut’s total adjusted gross income.

According to the U.S. Census Bureau, Connecticut experienced a net loss of 29,517 people in 2018, with a significant increase in the number of individuals moving to Florida.

Connecticut has seen an overall population loss to other states consistently since 2013, and studies show those moving out have higher earnings than those moving into the state, but 2017’s loss wasn’t nearly as bad as some previous years.

2015 saw a net loss of $2.6 billion, largely from high-wealth individuals leaving, with $1.8 billion of that wealth going to Florida, according to the IRS.

Between 2016 and 2017, Connecticut saw a net loss of $2.1 billion, according to IRS figures

The largest groups of people leaving generally consist of retirees and college students, and retirees make up a large portion of the income and wealth loss. But Connecticut’s sluggish economic growth may be driving people seeking jobs out of state as well.

The 2018 moving survey by United Van Lines ranked Connecticut 4th in the country for more people moving out than moving into the state. The primary reason for moves was job related, followed by retirement.

The 2018 United Van Lines survey showed that 51 percent of the people moving out earned over $150,000 per year, while 42 percent moving in had similar earnings. The latest 2019 survey shows similar results.

United Van Lines 2018 Survey

Florida has attracted some of Connecticut’s most wealthy individuals, including Paul Tudor Jones, Barry Sternlicht, Edward Lampert, C. Dean Metropoulos and Thomas Peterffy. Florida has no state income tax and actively tries to poach investment companies from Fairfield County.

The causes of Connecticut’s outmigration and population loss is a common subject of debate, ranging from the weather to the state’s tax burden, but the loss does have implications for the state’s fiscal future.

Lawmakers expect Connecticut’s revenue to continue increasing, and last year’s income tax receipts showed growth, but the year-over-year loss of high earning individuals for those earning less may complicate the math in the future.

Gov. Ned Lamont and the legislature closed a $1.5 billion budget deficit in 2019 with a mixture of small tax and fee increases and maintaining taxes that were meant to sunset. But the state now faces a $28 million deficit this year, when it was expecting to see a $141 million surplus.

The Office of Fiscal Analysis, however, projects budget deficits ranging from $757 million to $1.2 billion between 2022 and 2024, largely due to escalating fixed costs that are growing faster than revenue.

Fears of a recession for both the state and the country are somewhat tempered given Connecticut’s growing Rainy Day Fund, which is projected to grow to $3 billion by 2021.

New York, Illinois and California all saw large outflows of wealth, losing as much as 1.3 percent of their total AGI to other states, according to Wirepoints.org.

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(10) Comments

  1. Mark Witt

    January 21, 2020 1:11 pm

    Connecticut has found itself in a death spiral concerning its finances. With the stock market reaching new highs and record low unemployment , you would think that CT’s economic climate would begin to right itself. The Democrats in our state capitol seem to be more concerned about Trump’s activities then the welfare of its citizens. The tax and spend mentality in Hartford, has resulted in lower standards in both education and healthcare as the state can no longer afford to subsidize its larger towns and cities. States such as Florida and Texas, will continue to benefit from our current anti- business mentality. Gov. C Baker (R-MA) has set the example for Northeastern states in adopting a pro- business, pro-jobs agenda… Perhaps we should….. Never, Connecticut will double down on its few remaining citizens… We Tried…

  2. FlaBound

    January 21, 2020 12:21 pm

    When GE left the state government tried to make you believe they wouldn’t be missed.
    And they were making a mistake.
    It only foreshadowed the the exodus to follow.
    The wealth that left the state when all the senior executives from GE departed can’t be overlooked.
    These same people were friends, socialized and interacted in business together…. You and your friends don’t stay where you’re not wanted.

  3. Jeff Benvenuto

    January 18, 2020 9:24 am

    They vote the expecting different results …
    Not happening.

  4. Ron

    January 15, 2020 7:18 pm

    Yes Connecticut taxes are horrible yes Connecticut is badly run by a democratic structure I pay over 70k in taxes. The winter can be rough ,ice ,snow ,rain wind cold . yes you have to pay for heat and snow removal Yes the people here can be rude. Yes Connecticut has its problems but Florida ? Send you kids out in the yard to play and their legs will be missing from fire ants . The cockroaches? well you can ride them. My neighbor has teeth ,is not roasting a pig every month in the yard with his above ground pool leaking into his other neighbors yard. Cars on blocks, cloths lines everywhere. termites that will destroy anything of wood. Oh and tell me how that dip in a lake turns out. Florida heat is worse than Connecticut’s cold. Keep Florida.
    Connecticut is safer, prettier, cleaner. Litchfield hills yes I will die here.

    • Ralphy

      March 27, 2020 1:59 am

      You are in a totally different income level then someone like me that has to be aware of costs. Good luck to you and keep paying.

  5. Bob White

    January 12, 2020 1:11 pm

    Next summer will mark the 18th anniversary of our move from Connecticut to Florida. As a friend of mine is fond of saying, “Never a bad day in Florida.” No ice. No slush. Don’t have to shovel the heat off of my sidewalk. Don’t have to scrape the humidity off of my windshield. It’s very flat so the roads tend to be straighter – don’t have to worry about curvy, hilly roads and there’s no ice on the roads even if they did curve.

  6. James

    January 12, 2020 4:17 am

    Well what do the politicians expect when they keep doing the same thing again and again forever ?
    Don’t we ever learn from mistakes in this state 🙁

    • Pam L

      January 13, 2020 1:56 pm

      When will people stop voting for Democrats who keep jacking up taxes??? When will people DEMAND an audit on where the money coming in is spent??

  7. John R. McCommas

    January 11, 2020 6:03 pm

    Florida is certainly on my list. I lived there while I was in the navy and I profoundly regret coming back.

  8. Thad Stewart

    January 11, 2020 7:33 am

    Somebody needs to send the clue to the bozo gubment officials, that We the People of the State of Connecticut do our fare share in paying taxes. It is now time for them to tighten their belts, make the necessary cuts across the board and put SEBAC in the dumpster where it belongs. Things only work when it is a two way street, not the one way the dumbo crats would like it to be.

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