December 28, 2023
Here’s Why The South Is Leading In Economic Freedom
Black Americans’ continued dominance in the South is deeply catalyzed by their personal and cultural ties.
Are you seeking economic freedom? Data show that the “promise” of northern cities is rapidly diminishing as the economic gains of the South have finally eclipsed it.
Personal and cultural ties deeply catalyze Black Americans’ continued dominance in the South. In recent years, Black Americans who migrated to the South, especially those settling in economically thriving areas—the central southern magnet states of Texas, Georgia, and North Carolina–have been disproportionately young and well-educated. According to a report published by Bank of America, the region’s lead will continue to soar after decades of strong population and economic growth in the South.
Whether you want to migrate to a new city or region, look at these five economic activities in the South.
BLACK-OWNED BUSINESSES ARE MULTIPLYING
From Buckhead to Midtown, Atlanta ranks “peachy keen” with the highest % of Black-owned businesses at 7.4%. This is partly possible because of the multitude of programs and initiatives to support Black-owned businesses, including the Atlanta Business League, which provides resources and support to Black entrepreneurs, following “Hotlanta,” Washington, D.C. (7.0%), and Virginia Beach (6.8%).
“THE NEW GREAT MIGRATION” IS A KEY DRIVER TO POPULATION GROWTH
The 16 states that make up the southern region represented 39% of the entire U.S. population as of 2022. The South also has the highest birth rate of the U.S. Census Regions. Between July 2021 and 2022, Florida, South Carolina, and Texas were among the nation’s fastest-growing states by population. The volume of renewed Black migration to the South is notable, as are the changes they bring to the region about youth and human capital. Young Black people of all calibers are drawn to education and networking opportunities.
THE JOB MARKET IS GETTING HOTTER
The South has the highest job openings rate at 5.6% and the lowest unemployment rate of any region. The South also led all areas in hiring workers, with a rate of 4.1%. For example, as of 2020, almost 60% of the Black labor force (11.8 million people) is accounted for in the South, McKinsey & Co. reported. Additionally, Atlanta has 10 HBCUs providing education, training, and mentoring for future Black business owners. Georgia and North Carolina have the second-most HBCUs.
BETTER BUSINESS TAX CLIMATE AND LOWER BURDENS
Data supports the Northeast states’ worse business tax climates and higher tax burdens. The average rank for Northeast states is 38, while the average for the six-state South is 17. This is a huge benefit for Black-owned businesses. According to the Tax Foundation, the average state and local tax burden in the Northeast is 12.4% of net state product. The rate is 29% lower in Texas, Florida, Georgia, Tennessee, and the Carolinas.
GROWING GROSS DOMESTIC PRODUCT (GDP) SURPASSES NORTHEAST
As reported in Bloomberg, the combined GDP of Texas, Florida, Georgia, Tennessee, and the Carolinas surpassed the GDP of the Northeast region, including Washington, D.C., and the 11 states from Maryland up to Maine. In 2022, the national GDP in the South was 23.8%, while the Northeast’s was 22.4%. The South fell short over a decade ago.
Although it is unclear what satisfies migrants or residents in the South, the Bank of America report suggests that people are intensely interested in their finances.
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