Places with the most opportunity used to attract the most new residents, in a cycle of fast-growing cities and rising prosperity. But no more


The places that are booming in size aren’t the economic boomtowns — the regions with the greatest prosperity and highest productivity. In theory, we’d expect those metros, like the Bay Area, Boston and New York, to be rapidly expanding, as people move from regions with high unemployment and meager wages to those with high salaries and strong job markets. 

That we’re not seeing such a pattern suggests that something is fundamentally amiss. The magnets aren’t working.

The metro areas that offered the highest pay in 2000 have grown by some of the slowest rates since then, while people have flocked to lower-wage metros like Las Vegas, Phoenix and Charlotte, N.C. Similarly, the metros with the highest G.D.P. per capita are barely adding workers relative to much less productive areas. 


The population growth that is occurring in these metro areas is fueled almost entirely by  immigration, as Ryan Avent points out in “The Gated City,” where he makes a similar argument to Mr. Schleicher. If we consider only domestic moves, about 900,000 more people have moved away from New York than to it since 2010. On net, about 47,000 have left both San Jose and Washington, D.C., while Boston has lost a net 36,000. 

If these places remain magnets for immigrants, the high cost of housing is now repelling current residents, in addition to keeping away more potential new ones. That should worry everyone, the Obama White House warned last year, as severe housing shortages in a handful of places worsen income inequality across the country and stifle the nation’s productivity. 

To think about it another way: If these highly productive metros would build enough housing, Mr. Schleicher believes that would do more to improve the prospects of American workers and buoy the nation’s economy than proposals like lowering corporate taxes contained in the tax bill the Senate passed last week.

“And it’s not even close,” Mr. Schleicher wrote in an email. “A policy that aimed at reducing barriers to locational choice would outperform anything in the tax reform bill.”