Massachusetts Exodus: 182,000 Residents Flee in Five Years Amid Tax and Housing Pressures
A steady exodus from Massachusetts has seen nearly 200,000 residents depart for other states over just five years, with analysts pointing to rising taxes, soaring housing costs, and a cooling job market as key drivers. A new report from the Pioneer Institute estimates that approximately 182,000 people left the Bay State between April 2020 and July 2025—a population loss equivalent to one-and-a-half times the city of Cambridge.
A Structural Problem, Not a Short-Term Blip
Researchers emphasize this trend is not merely a post-pandemic anomaly. For years, more people have chosen to leave Massachusetts than move in from other parts of the United States, creating a persistent gap that weighs heavily on the state's workforce and economic growth. The report, titled The Massachusetts Labor Force: Now and Beyond, concludes that domestic outmigration represents a structural problem, reflecting deeper affordability and competitiveness challenges.
Tax Burdens and Housing Affordability Concerns
Massachusetts imposes a 5 percent flat income tax, with income above $1 million subject to a 9 percent rate, alongside a 6.25 percent sales tax. In Boston, long considered one of the nation's most desirable places to live, property taxes have become a focal point of concern. Average single-family tax bills are projected to rise between 13 percent and 34 percent from 2023 to 2026, significantly increasing the cost of homeownership.
Earlier this year, Boston Mayor Michelle Wu proposed a multi-year residential property tax relief plan designed to mitigate these increases. However, the proposal ultimately stalled, leaving the projected hikes in place and exacerbating financial pressures on residents.
Economic and Labor Force Implications
While a recent surge in international immigration temporarily bolstered labor force numbers, the report cautions this trend may prove short-lived. It cannot indefinitely offset domestic outmigration. Massachusetts remains one of just four states yet to regain its pre-pandemic private-sector employment levels. Meanwhile, faster-growing states such as Florida, Texas, and North Carolina continue to attract workers and businesses with lower tax rates, reduced living costs, and warmer year-round weather.
Although the labor force expanded in 2024 and 2025, this growth was largely driven by international migration—a source projected to decline by nearly 90 percent from its 2024 peak by 2026 amid tightening federal immigration policy.
Broader Economic Indicators Show Fading Momentum
Broader economic indicators suggest momentum may be fading. The state's GDP growth has trailed the national average for five consecutive quarters. According to Moody's Analytics, Massachusetts is among roughly one-third of US states currently in or at high risk of recession. Inflation remains elevated, particularly in Greater Boston, eroding purchasing power, while wage and salary growth has slowed due to fewer job openings and more cautious hiring.
Economic growth and the labor force are intimately tied, the report states. Strong economic tailwinds create the conditions necessary for businesses to confidently expand and hire workers, while uncertainty and downturn can lead the private sector to pull back.
Longer-Term Demographic Challenges
Beyond near-term economic softness, the report underscores longer-term demographic challenges. Low birth rates, a shrinking youth population, and an aging workforce are slowing natural population growth and constraining the future talent pipeline. Boston's population aged 60 and older is rising rapidly, with projections suggesting as many as 130,000 seniors could reside in the city by 2030. As of 2025, more than 84,000 residents were age 65 or older.
Federal Policy Shifts and Research Funding Risks
Federal policy shifts could further intensify these headwinds. Higher interest rates raise borrowing costs for businesses, tariffs increase the price of imported goods and energy, and immigration restrictions limit the inflow of skilled workers and international students—populations on which Massachusetts' universities and STEM industries heavily rely.
The report also cautions that reductions in research funding from agencies such as the National Institutes of Health and the National Science Foundation could disproportionately affect Massachusetts, which receives more such funding per capita than any other state.
Strengths and Recommendations for Renewal
Despite these challenges, the authors emphasize that the Commonwealth retains many strengths. Massachusetts ranks eighth nationally in labor force participation and leads the nation in educational attainment. These strengths can support renewal, the report concludes, if paired with sound policy reforms.
To build a sustainable workforce, the report recommends improving programs that help immigrants enter and succeed in the job market. It also calls for expanding job training in high-demand fields, investing in vocational and technical education, and addressing the underlying economic challenges causing residents to leave. Without action, the authors suggest Massachusetts risks continued population loss, slower economic growth, and a diminished position in the national economy.
