It didn’t take long at her new job for Yvonne Hao to pick up on a big difference between working in the private sector and in government.
When Hao worked for PillPack and Bain Capital, the metrics for success were simple: EBITDA, revenue, shareholder value. In contrast, as she wraps up her first year as Governor Maura Healey’s economic development secretary, Hao knows successful outcomes in state government don’t fit so easily into a spreadsheet.
But there’s at least one data point that keeps Hao up at night: the number of people decamping from Massachusetts for other states. And on that front, she has some reason to celebrate.
When she first took the job, the number that worried Hao more than any other was the 57,000 more people who left Massachusetts than moved here during the 12-month period ending in June of 2022. Eleven hundred a week. It was one of the highest domestic outmigration totals of any state, attributed at least in part to the rise of remote work during the pandemic. She joked about getting an “1,100″ tattoo, to serve as a constant reminder. Her biggest fear was that 2023 would look a lot like 2022 — that the trend, like a tattoo, would become permanent.
In December, we got promising news from the US Census Bureau. The state’s population grew for the first time since 2020, rising back above the 7 million mark. One big reason, per the UMass Amherst Donahue Institute’s Susan Strate: net international migration reached its highest point in at least the past three decades. What about domestic outmigration? Progress there as well. Massachusetts “only” lost 39,000 people to other states in the 12 months that ended in June 2023.
That 1,100 weekly figure — the one that caused Hao to fret all year — was down to 750.
That’s not to say Hao’s work is done here. Far from it. Massachusetts still loses thousands of people each year to places that are warmer, less expensive, or both. We’re also still exceeding our traditional levels of net outmigration — usually under 30,000 a year. And only four states saw larger exoduses, again. They were the usual suspects, each of them, like Massachusetts, known for high costs of living: California, Illinois, New Jersey, and New York.
Hao studied economics at Williams and at the University of Cambridge. She realizes the Healey administration can’t take too much credit for this change. These trends are largely driven by forces outside a governor’s immediate control, after all. Plus, this particular period only covers six months of the Healey administration’s tenure. But Hao believes some of the administration’s economic accomplishments helped move the needle, or “put some points on the board,” as her basketball-playing boss might put it. She cites the $1 billion tax relief package that the Legislature passed, and Healey signed into law in October, which included increases in child and family tax credits and estate tax reform, along with a grocery list of other less expensive adjustments.
Hao cites other points on the board: winning a hub for ARPA-H, the new federal medical research agency that opened up in Cambridge; the landing of nearly $20 million in federal funds to establish a microelectronics hub for the Defense Department; the launch of the MassTalent program, to make it easier for employers to find the right workforce training programs.
All that said, to switch sports metaphors, it’s still early innings. If the policies from the first year do make a significant impact, that won’t be seen in the migration numbers until the next Census report in December. It’s also too early to know the impact of the new income tax surcharge — the voter-approved “millionaires tax” that raised fears it could chase away many high earners.
And Hao spent many months crafting a new blueprint for economic growth in Massachusetts; filed in December, this plan will serve as a springboard for the Healey administration’s first broad economic development bill in the coming weeks.
Hao and Healey have been somewhat circumspect about the content of that bill, although some broad contours have become clear. They will seek to recapitalize the state’s life sciences funding, and they’ll aim to supercharge the climate tech sector. Tourism will be a big focus, particularly with plans underway to celebrate the 250th anniversary of the events that led to the American Revolution. Hao would also like to focus on artificial intelligence, advanced manufacturing, and robotics.
The Healey administration also wants to tackle the high cost of housing, perhaps the biggest threat to the state’s economic competitiveness. On that front, Healey is promoting a separate $4 billion bond bill, loaded with policy changes, that she hopes will unlock more construction and boost funding.
As Hao sees it, Massachusetts doesn’t need to grow its population by some ginormous number. There’s so much talent here already, including the tens of thousands of students here for college. The key is retaining that talent — young adults in particular — and attracting enough newcomers to help employers meet their needs.
That’s a challenge for almost every industry, and a reason the migration issue remains top of mind in the business community. Brooke Thomson, the new chief executive of Associated Industries of Massachusetts, lamented to her membership this month about how entrepreneurs and other wealthy individuals have left for more favorable business climates. Meanwhile, Greater Boston Chamber CEO Jim Rooney noted in an address to chamber members how he learned firsthand last year about leaders in Raleigh, N.C., working to poach Massachusetts businesses and workers; like Hao, Rooney has a number he’s focused on: 122,000 more residents moved away to other states than moved here over the past three years.
Hao welcomes feedback like this. In fact, she seeks it out at every turn.
But she doesn’t need a reminder about the migration data.
Hao has got a new number in her sights now: 750 a week. She says she won’t be happy until that gets significantly smaller. By one important way of keeping score, at least, this game isn’t close to being over yet.