FILE: With the Interstate 5 bridge in the background, a person walks a dog on Feb. 13, 2024, in Vancouver, Wash. The city welcomed nearly 2,000 new residents in the year leading up to last July.
Jenny Kane / AP
Portland’s population went down by more than 4,000 residents between July 2022 and July 2023, according to recent U.S. Census Data.
But that doesn’t mean people are abandoning the Portland metro region altogether — though, it could mean they are leaving Oregon. Vancouver, Washington, gained nearly 1,950 residents during the same time period.
Portland and Vancouver are inextricably linked economically and have been for decades, say economists who study the region. The relationship is somewhat unique, though, because the cities reside in two different states with different tax policies.
People living and working in southwest Washington are able to minimize income taxes, according to Oregon State Economist Josh Lehner, and they are able to soften the impact of sales tax by shopping in Oregon.
“Such a stark difference in tax policy is pretty rare across the nation, especially within a large population area,” Lehner wrote in a recent analysis of the two cities. “While taxes, or public policies more broadly, are rarely the only motivating factor for businesses and households, they clearly play a role in our lives and our behavior.”
Jim Vleming is a regional economist for the state of Washington, and he agrees with Lehner’s analysis. Vleming’s research area includes Vancouver and Clark County as a whole. He said tax policy may play into some people’s motivation to move across the river — but, similar to Lehner, he said that’s not the whole picture.
“We’ve seen a whole dynamic shift with work from home and people moving around and being a little bit more flexible,” Vleming said. “Some of the stuff, I think, that plays into economics is the psychology of it — and you really don’t know what people’s decision making process is about where they want to live or work.”
He said while city and state officials may be concerned about the reshuffling or shrinking of tax revenue, the migration between Portland and Vancouver could be a boon to other parts of the economy.
“Both areas offer a pretty skilled workforce,” Vleming said. “That’s always something that a company is looking for, to have access to a skilled workforce.”
Vleming said multiple factors play into people’s decision making process, including hard to calculate things. He said while many folks may be moving to Vancouver to enjoy city life, even more are moving to other parts of Clark County, which welcomed 4,413 new residents from July 2022 to July 2023. Those decisions may be less about tax policy, Vleming said, and more about whether someone prefers suburban, city or rural living.
In Oregon, while Portland lost residents, some of the surrounding counties saw population growth, showing a move away from city centers to the suburbs. People appear to be moving to places like Milwaukie, Happy Valley and Woodburn.
Vleming points out that while the arrival of new people can increase tax revenue for counties, it also means having to provide services for the influx of residents. The biggest strain is likely on transportation infrastructure — namely roads and bridges, which already have a reputation for congestion in the area.
“As time goes on, I think we’re going to just deal with a lot of infrastructure [constraints] and accommodating a lot more people,” Vleming said, “because this is a desirable area for all the outdoor opportunities and the natural beauty. It just brings a lot of people in, and I think that’s going to continue.”
