Cities and states have long doled out economic incentives to businesses that promise to bring jobs to their community. Now some places are taking that to the next level by offering incentives to people to move there. It’s because they believe their labor force is insufficient.
Jobs at the paper mills and safe manufacturers on this stretch of the Great Miami River mostly dried up by the early 2000s, leaving behind closed factories and an abandoned downtown.
Today, a spruced-up waterfront, loft apartments and help-wanted signs give the appearance of economic renewal. All that’s missing are workers—and that has prompted a novel experiment.
Relocate to Hamilton, [Ohio] and the city promises $5,000 to help pay student loans. Pack up for Grant County, Ind., and claim $5,000 toward buying a home. Settle in North Platte, Neb., and the chamber of commerce will hold a ceremony in your honor to present an even bigger check.
In this new phase of the U.S. economy, one marked by a shortage of workers rather than jobs, civic leaders in Hamilton and elsewhere are asking themselves: Why not pay people to move here?
I will acknowledge that many places face some legitimate structural demographic challenges. North Platte, NE is a remote town of 24,000 people. They are going to have a tough sell for people who aren’t already familiar with their community or Nebraska generally.
But Hamilton, Ohio is a suburb of Cincinnati. Labor force is not an issue because they can draw from a metropolitan population of over two million. (JD Vance’s Middletown is another suburb in the same general area). Cincinnati is not a boomtown, but is a growing major American region that is a serious draw in many ways. Middletown has simply not been competitive for residents within their region.
The article describes Hamilton as having a revived downtown. I haven’t been there in quite a while, but while it’s likely there have been some improvements, it’s unlikely the community has been fundamentally transformed given that I can’t cite any examples of that happening in the Midwest in recent years.
A lot of these communities were factory towns that never historically invested significantly in place. What they did have in quaint downtown districts significantly decayed over time. It will take a very long time to change that, and the community’s reputation in the market.
Unfortunately, the go to lever for states and localities has been incentives. This bribing people to move to your city is yet another example of the subsidy mindset. At some point, communities need to figure out how to break out of that treadmill.
Update: Some people associated with Hamilton were not happy with my article and wrote a response that you can read for yourself.