North Texas’ center of economic gravity is shifting to the suburbs, particularly Collin and Denton counties, as “income migration” reshapes the region.
Dallas County lost about 10,000 households filing income tax returns to Tarrant, Collin, and Denton counties between 2020 and 2021, net of movers in the other direction, based on an analysis of IRS data on mailing address changes by tax filers over the last 10 years. This amounts to 1% of Dallas County’s total tax-filing households.
But the impact is more pronounced than this data suggests. Outbound migration to Tarrant, Collin, and Denton counties resulted in a larger percentage loss in total taxable income in Dallas County – $960 million, or 1.1% of the county’s total, according to the IRS release.
Average income of people leaving the urban core – Dallas and Tarrant counties – for Collin or Denton counties was considerably higher than that of people moving in the other direction. Households leaving Dallas County for Collin County, for instance, had average taxable income of $85,000 while those moving from Collin to Dallas County averaged $76,000.
This pattern runs counter to a common narrative that productive, high-income people are returning to core cities while core-to-suburban migrants are mostly less wealthy people moving for cheaper housing. Recent facts point to the opposite conclusion for North Texas. People are resorting in ways that widen the lead of Collin and Denton counties over the region’s core counties in income terms.
North Texans are moving from core cities to suburbs for simple reasons: attainable housing, good schools, low crime rates, and superior economic opportunities.
Similarly rapid migration from core to suburban counties is happening across the United States. We looked at 111 counties in the 20 metros among America’s 100 largest that have seen the fastest net in-migration since 2010 and the 20 experiencing greatest net out-migration. Among these counties, 68 suburban counties added 6% to tax-filing households relative to the 43 core urban counties in these metros between 2011 and 2021. Taxable income in the suburban counties rose 12% relative to the core counties. Suburban counties also increased their large lead over core counties in absolute income levels.
Collin and Denton counties saw tremendous net in-migration from the region’s core urban counties between 2020 and 2021. In booming Collin County, net in-migration from Dallas, Tarrant, and Denton counties added just over 4,000 tax-filing households, amounting to 1% growth, and over $300 million to total taxable income. Denton County was the region’s biggest winner, gaining 5,000 tax-filing households from the other three counties, or 1.4% growth, and $765 million in total taxable income.
Tarrant County, meanwhile, has performed significantly better than Dallas County. Inflows to and outflows from the other three counties were nearly even between 2020 and 2021 in Tarrant County, with net in-migration of just 824 tax-filing households and a very slight loss of taxable income.
Migration numbers between North Texas counties and the rest of the country tell a similar story. Dallas County lost 0.3% of its tax-filing households from net out-migration to places other Tarrant, Collin, and Denton counties – not as large as the outflow to nearby counties, but at odds with the story that countless people are moving to Dallas.
By contrast, Tarrant, Collin, and Denton counties all performed extremely well in attracting people and income from beyond the region. Net in-migration from places beyond the four counties led to taxable income growth of 4.1% in in Tarrant County, 3.7% in Collin County, and 4.6% in Denton County
These migration trends are consistent with longer-term trends. Between 2011 and 2021, Dallas County lost 29,000 tax-filing households to net out-migration, or 4% of total tax-filing households as of 2011. In income terms, Dallas County lost almost $3 billion, 4% of the county’s 2011 total. In-migration added 12% to taxable income in Tarrant County, 18% in Collin County, and 32% in Denton County over the decade.
The region’s core-to-suburban shift, moreover, accelerated between 2011 and 2021. Dallas County’s inflows and outflows approximately offset each other between 2011 and 2016 but then turned to significant net outflows in more recent years. In Collin and Denton counties, annual inflows of tax-filing households ran twice as high between 2016 and 2021 as they did during the previous five years. Income inflows accelerated even more.
If these trends continue, they will dramatically reshape the economies of both North Texas and the United States. Many core cities will see their population shrink and their taxable income shrink even more, while the center of economic gravity will move decisively to suburban communities. These trends are playing out faster in the Dallas-Fort Worth area than in virtually any other region – making North Texas a harbinger of demographic change across America.
