Pennsylvania’s Shrinking Population Problem
In The Office finale, Jim and Pam decide to pack up their family and move from Scranton, Pennsylvania to Austin, Texas. While Jim and Pam aren't real, their fictional trek to Texas is an all too common story. Persistently high taxes, overspending, and frivolous regulations are stifling job opportunities in the commonwealth, and driving people to other states.
For decades public officials have increased the size and scope of state government, believing it will improve the lives of Pennsylvanians. Instead, the growing burden of government has driven away present and potential entrepreneurs, making the state a less attractive place to live and work.
Don’t take my word for it. The Independent Fiscal Office (IFO) analyzed tax returns from the Internal Revenue Service (IRS), finding Pennsylvania lost a net total of 21,578 individuals to other states during the 2012 and 2013 calendar years.
The trend in the chart above is unmistakable. People are leaving Pennsylvania and moving to low tax states like Texas, Florida, and South Carolina. The commonwealth is also losing residents to border states like Delaware and Ohio, neither of which have a particualry low tax burden, but when compared to Pennsylvania, look enticing for people who want to run a successful business and keep more of what they earn.
In contrast, people living in New York and New Jersey are seeking refuge in Pennsylvania because the commonwealth’s tax burden is lower than the burdens in the Empire and Garden States. The movement of people from relatively high to relatively low tax states isn’t just a theory; it’s a documented trend.
The IFO report, bolstered by past research, is a timely reminder of why Governor Wolf needs to drop his proposal to raise income and energy taxes. His plan will drive away even more jobs, sending couples like Jim and Pam to pursue their dreams in low tax states.