The Mobility Myth: Why Moving for Opportunity Isn’t What It Used to Be

For generations, the American narrative was simple: if you didn’t like your prospects, you moved. From the Dust Bowl to the Great Migration, from the Gold Rush to the Sun Belt surge, mobility was the escape hatch from dead-end economies. But that hatch is rusting shut. Research from the Federal Reserve Bank of Richmond reveals that interstate migration rates have plummeted from roughly 20% annually in the mid-20th century to just 7.8% today. The American Dream, once defined by the freedom to chase opportunity across state lines, has calcified into a geographic lottery: your life chances are overwhelmingly determined by where you were born, not where you could go.

This isn’t a temporary blip caused by remote work or pandemic disruptions. It’s the culmination of decades of economic forces that have quietly transformed mobility from a pathway to prosperity into a privilege for the affluent. Housing costs have disconnected from wages. Labor markets have fissured into contract gigs. Corporate consolidation has killed the job ladder. The result: America now has lower rates of economic mobility than most advanced economies, and the once-reliable strategy of “moving for a better life” has become a financial impossibility for millions.

The Great Slowdown: When America Stopped Moving

The decline in American mobility is staggering in both speed and scale. As recently as the 1980s, nearly one in five Americans moved annually, most in pursuit of better jobs, cheaper living, or simply a fresh start. Today, that number has been cut by more than half. The Richmond Fed’s analysis shows this decline is universal—every age group, every region, every demographic is moving less . Even young adults (25-34), historically the most mobile cohort, have seen their migration rates collapse.

This isn’t happening because people suddenly prefer staying put. It’s happening because the economic math no longer works. The traditional migration equation was straightforward: move to a high-wage area, absorb some cost-of-living increase, and still come out ahead. But two structural shifts have broken this model. First, regional wage differences have narrowed dramatically—meaning the financial upside of moving has shrunk . Second, housing costs in opportunity-rich cities have exploded, creating a barrier that swallows any wage gains.

Consider the cognitive hubs—cities like San Francisco, Seattle, and Boston—where high-skill workers and innovative companies cluster together. These agglomeration economies should theoretically pull in talent from across the country. But restrictive housing policies have made these cities affordable only to the already-wealthy. As a result, workers who could be more productive in these locations are trapped elsewhere, and U.S. GDP growth has suffered dramatically—research estimates housing restrictions alone reduced GDP growth by 36% between 1964 and 2009 .

The Anatomy of Immobility: Why Americans Stay Put

Economic models of migration assume rational actors weighing costs and benefits. The problem is that the costs have soared while the benefits have flatlined. Let’s dissect what’s actually happening:

1. The Housing Cost Trap

The 2024 working paper cited by the Richmond Fed reveals a critical shift: households have become dramatically less responsive to high housing costs in their current area, choosing to stay even when it makes financial sense to leave . This isn’t irrational—it’s rational adaptation to a rigged game. When every desirable destination has equally unaffordable housing, moving offers no escape.

This “mobility freeze” is particularly severe for older, less-educated, and working-class homeowners. They’re trapped by underwater mortgages, lack of buyer interest in their current homes, and the inability to qualify for mortgages in high-cost destinations. The housing market, once the great enabler of mobility, has become its prison.

2. The Wage Suppression Engine

Even if housing were affordable, wages no longer provide the necessary pull. Equitable Growth research highlights how monopsony power—employers’ ability to set wages—has intensified dramatically. Studies show that employer concentration alone suppresses wages for 10% of the U.S. workforce by 2-7%, with wage markdowns ranging from 7% to 58% depending on the industry .

This wage suppression is compounded by the “fissuring” of labor markets—where companies outsource essential functions to contractors who pay less and offer no career ladder. Add the collapse of union density since the 1980s, and you have a labor market where switching jobs no longer guarantees a raise. In fact, workers are increasingly afraid to leave, with 16% staying in unwanted jobs primarily to avoid losing health insurance .

3. The Broken Job Ladder

The old path—start at the bottom, work your way up, move to a better job in a better city—assumed functional job ladders existed. Those ladders have been systematically dismantled. Large firms now reserve their best opportunities for external hires from elite universities, not internal promotions. Non-compete clauses lock workers in place. Gig work offers flexibility but no upward trajectory.

Meanwhile, the rate of new business formation has collapsed, eliminating the traditional escape route for entrepreneurial workers. Without small firms creating new opportunities, workers are stuck in corporate structures that offer little mobility even if you move across the country to join them.

The Geography of Stuckness: Where You Start Is Where You Stay

Perhaps the most damning evidence against the mobility myth comes from Raj Chetty’s Opportunity Insights research, which tracked 57 million children to map economic mobility by geography . The findings obliterate the notion that America offers equal opportunity to all comers:

• The Black-White Mobility Gap: Black families experience dramatically lower upward mobility from the bottom of the income distribution and higher downward mobility from the top than similarly situated white families. This gap narrowed slightly between 1978-1992, but remains vast .
• The Class Gap Widens: Among white children, the class gap has grown significantly, with low-income white children falling further behind their high-income peers—particularly in coastal opportunity hubs that have seen mobility decline .
• Opportunity Clusters: Some places—Salt Lake City, San Jose—maintain mobility rates comparable to the world’s most equal societies. Others, particularly in the Deep South and Rust Belt, have mobility rates lower than any developed country .

The cruel irony is that the places offering the best opportunities have become the most exclusive. Coastal cities that once pulled in strivers from across the nation now actively repel them through housing costs. Meanwhile, struggling regions can’t retain talent because they offer neither high wages nor affordable housing. The result is a sorting effect: the educated and affluent cluster in cognitive hubs, while everyone else is marooned in places with diminishing prospects.

The Consequences: When Mobility Dies, So Does the Dream

The mobility myth’s collapse isn’t just an economic curiosity—it has profound social and political consequences. When people can’t move to opportunity, opportunity doesn’t move to them. Instead, inequality hardens into a caste system.

Economic Stagnation

Immobility creates a vicious cycle. Workers trapped in low-wage regions can’t demand higher pay because employers know they have nowhere to go. Companies in high-cost cities can’t expand because they can’t afford to pay workers enough to live there. The result is a sclerotic economy where labor doesn’t flow to its most productive uses. The Federal Reserve Bank of Chicago notes that intergenerational mobility appears to have worsened sharply around 1980, precisely when inequality began its steep climb .

Political Polarization

When people can’t vote with their feet, they vote with their anger. The World Socialist Web Site argues that the “mobility freeze” creates a permanent underclass that can be easily exploited by political demagogues . Regions left behind don’t just lose population—they lose faith in the system that abandoned them. The result is a politics of resentment, where the promise of the American Dream is replaced by the reality of permanent decline.

Intergenerational Inequality

The ultimate tragedy is that immobility begets immobility. Children raised in places with low upward mobility are less likely to attend college, more likely to experience teenage pregnancy, and more likely to end up in prison. They inherit their parents’ zip code as surely as they inherit their eye color. As The New Yorker observed, even societies with “high” mobility aren’t that mobile—only 13% of people in San Jose’s bottom quintile reach the top, and Sweden’s elite remains dominated by the children of the rich . The American Dream has become the American Illusion.

The Path Forward: Can Mobility Be Restored?

The mobility myth won’t resurrect itself. Addressing it requires confronting the structural forces that killed it—housing policies, labor market regulations, and the concentration of economic power.

Housing Market Reform

The single most impactful change would be dismantling exclusionary zoning in high-opportunity cities. If coastal hubs built enough housing to meet demand, prices would moderate and the mobility engine would restart. This requires political courage to confront entrenched homeowners who benefit from scarcity, but it’s essential for both economic growth and equity.

Labor Market Rebalancing

Restoring worker bargaining power is critical. This means strengthening unions, banning non-compete clauses, and enforcing antitrust against labor market monopsony. When workers can demand better pay, moving becomes worthwhile again. Decoupling healthcare from employment would free millions to pursue opportunity without fearing medical bankruptcy.

Invest in Left-Behind Places

Finally, we need to bring opportunity to people, not just people to opportunity. This means federal investment in infrastructure, education, and entrepreneurship in declining regions. The goal isn’t to make every place equally prosperous, but to ensure that staying put isn’t a life sentence to poverty.