By: Ted Dabrowski and John Klingner
Wirepoints yearly out-migration research shows Illinois’ net loss of households to other states occurs in every single income and age bracket the IRS tracks (see appendix). What often gets the most attention is the flight of older, wealthier residents to other states. Their exodus has the biggest immediate impact on Illinois’ tax base. We’ve covered those losses extensively in our out-migration work linked here.
But what’s most concerning is the hollowing out of the state’s future – the loss of Illinois’ young, wealthy, upwardly-mobile, taxpaying millennials. A Wirepoints analysis of the latest IRS migration data from tax year 2022 shows Illinois was the 2nd-biggest loser nationally of households aged 26 to 35 with incomes greater than $200,000.
More than 1,300 such households fled the state, on net (3,141 households out, 1,818 in). That’s a loss of 4% of Illinois’ young, high-earning households in just one year. California was the biggest loser, with a net loss of over 3,200 households.
Unsurprisingly, zero-income tax states Florida and Texas were the big winners of the upwardly-mobile millennials.
Illinois has been bleeding this cohort for more than a decade, but the acceleration of losses in recent years is even more concerning. And it’s not just the loss of the talent that matters. This cohort is taking significant wealth out of the state. The average income (Adjusted Gross Income) for those leavers in 2022 was $435,000.
Loss of prime-age wealthy
Predictably, the losses of wealthy Illinoisans continue into the next age bracket, those of prime age (35 to 45) making more than $200,000. It’s the same story as above.
Illinois is in the bottom five nationally for losses in this bracket, and the flight of households is accelerating. What makes it more painful is the average AGI for these leaving households jumps to nearly $700,000.
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This above data flies in the face of the state’s cheerleaders who deny Illinois’ population loss and who talk often about growing tech jobs and “workforce development.”
It also shows just how absurd the idea of more tax hikes are. Chicago Mayor Brandon Johnson is searching frantically for whatever taxes he can hike, while Gov. J.B. Pritzker likely still longs for his progressive income tax hike. More hikes will only worsen the state’s exodus.
Appendix.
Read more from Wirepoints:
- Does Chicago Public Schools CEO Martinez deserve praise for taking on Mayor Johnson?
- Mayor Johnson’s spending decisions, falling revenues mean Chicagoans likely to get hit with 2025 property tax hike
- It’s not racist to call Chicago the nation’s murder capital. The Chicago Sun-Times has 617 reasons to call it that.
- Illinois’ Gov. Pritzker delivers Democrats’ national economic pitch at DNC. A look at his own record is revealing.
Audio and summary 
If this bill passes, say goodbye to local control over all Illinois parks and expect to see open drug and alcohol use, needles, no sanitation and fire hazards, but no ordinary park users.
Um, if it’s happening across all income levels, maybe there are factors here besides tax burden? Household income level for in and out migrants would be more informative using median than average, which is going to skew high and provide shock value but less insight on who is moving.
As an IL refugee now living in TN, I’m enjoying the benefits of a zero income tax, low property tax state. I’d be interested in this data summarized on a cumulative basis over last 5 – 10 years. The aggregate AGI loss and related income tax loss must be staggering.
YES, DOWN STATE IS BIG MESS ALSO.
The reason for this is, and I can speak from experience with these people, is college educated couples who met in Chicago but return ‘home’ or to some other favorable after having children to be with other family. They enjoy the city life but it’s a terrible place to raise children. The alternative is to move to the suburbs, but let’s be honest here, the Chicago suburbs (outside a handful of truly exceptional uber-wealthy areas) are pretty boring, and only getting worse. If a family wants to live in the suburbs, why live in the Chicago suburbs? Move to a… Read more »
Your observations are not completely accurate. The Chicagoland problems are irrefutable and there is no solution on the horizon, but there are still some nice suburbs with a high quality of life and booming restaurant scenes.
I was raised in one of the very nice suburbs (Lake County) and while I was poor I obtained an exceptional education and was very lucky to have lived in one of the handful of apartments in town. It remains a very good place to live, even with high property taxes. Really no crime. I would not describe the town as having a booming restaurant scene but the next town over does have one. I was constantly outdoors and found the Lake County Forest preserve system excellent, far beyond what one would expect in a relatively featureless area. The weather… Read more »
Many Chicago suburbs used to be nice when they were built but now it seems like a majorhave are turning into Waukegan. I used to drive all around Chicagoland for my job. I witnessed the decline on a near daily basis. During COVID I turned into a desk jockey and I rarely leave my suburb. But it looks like in the near future my job will be going back to driving around quite a bit. I expect to be shocked at the decline. I know the other day I drove through my hometown in Cook County, about 30 mins from… Read more »
My wife and I left IL in April 2023, for all the reasons that your publication has been illustrating. We are retired and could no longer stomach the high taxes and where and how our tax dollars were being spent. The crime was spilling into our western suburb with car thefts and car jackings. My nephew works for Citadel who has been temporarily relocated to NYC and will ultimately end up in Miami. The attitude of Mayor Lightfoot and Governor Pritzker of “don’t let the door hit you on the way out” was very disturbing. Citadel employed over 1,200 employees… Read more »
FL and Miami will appreciate them for sure. Miami is off the hook – so much discretionary income there it seems.
Democrats do not seem to care about any of this brain drain or tax drain – they deny it even exists. Nope. Democrats, from Pritzker to Pelosi to Biden/ Harris, main concerns 1) Maintain power at all cost, even if it ruins IL and America 2) More spending for favored donors 3) Grifting
What happens if current Illinois trends continue for another decade, or even worse, if they accelerate? Illinois residents don’t think about the long-term consequences of wealthy taxpayers leaving and the arrival of low skilled, undocumented labor straining public resources. It’s a recipe for financial disaster. Alternatively, consider the fate of the red states, with the former wealthy blue state earners and retirees settling down and adding to the red state tax base. The growing tax base will be used to increase police protection, build roads, modernize schools, and maintain a rainy-day fund when the next recession hits. The discrepancy between… Read more »
For the time being, blue states are arguably wealthier, for at least some classes of people, and they still have desirability for the laptop class. Illinois’s collapse has started but won’t go into full swing until there is an exodus of larger corporate employers to leave. Sure some larger companies have moved their smaller HQ’s (Morton, Cat, Boeing, etc) but only when larger local employers make the decision to run will the collapse truly come. It’s coming, and it won’t be long before major employers like McDonald’s, Allstate, State Farm, Aon, Abbvie, Mondalez, CME, IL Tool Works, Motorola, Chase has… Read more »
Well, the traffic on Lake-Cook Road will improve when Discover reduces staff in Riverwoods, still, glad I don’t work there anymore.
I drove on lake-cook road several months ago, from roughly 94 to 53 and I was shocked at the number of vacancies in those office buildings all along the way. It seemed like nearly 2 out every 3 building was completely vacant, with FOR LEASE signs in front, and zero cars in the parking lots on a Tuesday at 3 pm. I don’t know the exact number, but I would imagine the vacancy rate of the Lake-Cook corporate office submarket must be shockingly high. How will these buildings ever become occupied again? There just isn’t enough job growth in the… Read more »
If they ever implement the “LaSalle Street Tax” to soak “The Rich,” you will see the trades and the people who trade disappear from IL within 12 months (sooner, but quietly). That will be the inflection point down.
Ehh, carnival barkers. But why did they leave? Taxes? Is it due to another issue that can be addressed to stem the outflow? No state income tax could be a bonus prize and not the reason they are leaving.
Nothing to here. Illinois is evening things out by replacing the young native born with potential with dependant illegal aliens.