The City That Businesses Are Fleeing

A great deal has been made about the relocation of millions of Americans since the start of the COVID-19 pandemic. Many people moved because they could work from home. Others moved because they wanted to live in cities less expensive than those they left. Still, others moved for lifestyle reasons. Less well understood is the movement of entire companies. These movements showed that certain cities were the target of corporation migration. None was hurt more than Cambridge, Massachusetts, home to Harvard and MIT, two of the most highly rated universities in America. (These are the 50 best college towns in America.)

Hire A Helper’s “2023 Study: Corporate Relocation at Highest Rate Since 2017” report showed that about 9% of American companies have changed their headquarters locations since the start of 2022. About one-fifth of relocations were within the same city. About a third moved to another city within the state where they were previously located.

The researchers offered a theory about Cambridge’s problem: “This famous college town next to Boston, MA has long been a mecca for many biotech and pharma firms, which seemingly doesn’t leave room for previous industry giants.” Throughout the period 2022 to 2023, the net headquarters movement of Cambridge was −40%, when companies that left were compared to companies that moved to the city.

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Financial statement data sets published by the U.S. Securities and Exchange Commission were the source of most of the data for the study. The yardstick used was changed based on the term “business address.”

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Here are the top 10 cities where outbound movement topped inbound movement on a percentage basis:

  • Cambridge, Mass. (−40.0%)
  • Seattle, Wash. (−37.5%)
  • San Jose, Calif. (−25.0%)
  • San Francisco, Calif. (−21.9%)
  • Chicago, Ill. (−20.0%)
  • Miami Beach, Fla. (−17.4%)
  • Fremont, Calif. (−16.7%)
  • Greenwood Village, Colo. (−16.7%)
  • Menlo Park, Calif. (−16.7%)
  • Santa Monica, Calif. (−16.3%)

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