Knoxville Is Growing Richer, Less Affordable at the Same Time

The same growth that the drives a local economy can, at the same time, price out the people who built it.

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March 11, 2020, was a watershed moment that, for most Americans, marked the beginning of the pandemic era. That morning, the World Heath Organization declared COVID-19 a global pandemic. By afternoon, the NBA had suspended its season after Rudy Gobert of the Utah Jazz tested positive for the virus. By evening, President Donald Trump was addressing the nation from the Oval Office, announcing sweeping restrictions on travel from Europe to the United States.

What no one could have known was that day also marked the beginning of a mass reshuffling of the American population that would, over the coming years, reshape the nation’s geography. As remote work severed the link between employment and geography, a steady stream of workers and families began leaving the country’s largest metros for smaller, more affordable ones—drawn by lower costs, more space, and a better quality of life. Knoxville was among the most popular destinations. And ever since, longtime residents and policymakers alike have wondered: Who, exactly, is moving here and from where?

New IRS and Census migration data help answer that question.

Knoxville Is Leading the State in Net Domestic Migration

Knox County recorded the largest net migration gain of any county in Tennessee from 2020 to 2025, according to Census data. The county has sustained above-average population growth for several consecutive years, expanding at more than twice the national rate, with an average annual growth rate of 1.1% compared to 0.5% nationwide. That growth was driven entirely by net migration, not natural population increase, as Knox County for several years has recorded more deaths than births.

The composition of that migration is as notable as its volume. Recent growth was driven by younger residents: Gen Z and Millennials together accounted for approximately two-thirds of Knox County’s net migration gains from 2020 to 2025, with Gen Z alone accounting for more than one-third of all new arrivals. While a large share of that increase is attributable to enrollment growth at the University of Tennessee, data suggest Knox County is also attracting young professionals and early-career workers at a rate that seemed unlikely a decade ago.

But the headline numbers are only illustrative to a degree. What matters as much as how many people arrived is who they are—and what they brought with them.

Knoxville Is Attracting Higher-Earning Migrants

Since 2020, Knox County experienced a significant net gain in adjusted gross income (AGI), or taxable income, through domestic migration—evidence that, on average, those moving to Knoxville are bringing more income with them than those leaving.

The typical newcomer reported an annual AGI of $72,324 in 2023, slightly above the county’s median household income of $70,265 in 2023. Those leaving, by contrast, reported an average income of $66,655.

Knox County is gaining higher earners while losing comparatively lower-income households, predominantly to surrounding counties.

Aggregated across thousands of households, the economic impact is substantial. Driven by both a net increase in households and the wage differential between inbound and outbound movers, Knox County saw a total outflow of $878 million in taxable income from 2022 to 2023 compared to an inflow of $1.06 billion—a net gain of more than $180 million attributable to migration alone.

The picture looks different when narrowed to in-state migration. Within Tennessee, Knox County experienced a net outflow of $52 million in AGI, along with declines in both households and individuals, driven by an exodus of lower- and middle-income households.

The population growth driving Knoxville’s economy is, at the same time, pricing out the people who built it.

That is the central tension of rapid growth. When higher-earning newcomers compete for a housing stock that hasn’t kept pace with demand, prices rise. And when prices rise, the households with the least equipped to absorb those costs—longtime renters, working families, fixed-income residents—are the first to go.

Growth of this kind is rarely unambiguous. At a basic level, more income flowing into Knoxville means more income earned and spent locally—on homes, services, and small businesses. That spending then recirculates through the economy, creating what economist refer to as a multiplier effect: a new resident hires a contractor, who pays employees, who spend their wages at local restaurants and shops, which hire more workers to meet growing demand. Each round of spending generates another, amplifying the original impact and, over time, raising the ceiling for local wages and investment.

But benefits also come with tradeoffs. The same inflow of higher-income households also contributes to affordability pressures—most notably in the housing market, where increased demand and competition from higher-earning newcomers has pushed home prices and rents beyond what many existing residents can afford.

Over the long term, these pressures tend to moderate. Higher demand encourages new construction, expanding supply and easing upward pressure on prices. In practice, however, that process is slow. Housing takes time to build, and in the interim, the burden of higher costs falls disproportionately on renters and first-time buyers—those least equipped to absorb rising costs.

The benefits of growth accrue gradually over a period of years; the pressures arrive immediately.

That’s the disparate reality of growth in a place like Knoxville. In the short run, growth feels pernicious and destabilizing. Over the long term, however, it produces a larger, more dynamic economy with higher wages and more job opportunities.

Where Knoxville’s Newcomers Are Coming From—and Where Others Are Headed

Knox County’s population growth has consistently outpaced the national rate for more than a decade, driven entirely by net migration. In recent years, nearly half of all new residents arrived from a different state—a notable shift from the 2000s and 2010s, when in-state movers made up an overwhelming share of the county’s growth.

Top Origins of Inbound Movers

Florida and California are the top origin states. Together, they account for nearly 10 percent of all newcomers, representing 4.9% and 4.4% of inbound movers, respectively. While newcomers from both states have higher incomes than the overall average, the differences in income levels and household size illustrate how Knox County—and Tennessee more broadly—is attracting starkly different demographics.

Newcomers from California report average incomes roughly 34% above the overall inbound average and tend to have larger household sizes, suggesting a disproportionate share of newcomers are families relocating for work or seeking relief the Golden State’s notoriously high cost-of-living. Florida’s newcomers, by contrast, tend to be smaller households earning closer to—or even below—the average, indicating that a disproportionate share of newcomers are retirees or near-retirees living on fixed incomes.

These patterns extend beyond California and Florida, too. Fulton County, Georgia—the core of the Atlanta metro area—offers another example. It is younger, more highly educated, and significantly higher-income than most origin counties and sends newcomers whose average incomes are roughly 59 percent above the typical inbound mover, despite having a smaller average household size. It mirrors a broader migration pattern: higher-earning, working-age households leaving expensive metros—some relocating, some returning home—to more affordable cities like Knoxville.

Top Destinations of Outbound Movers

Equally important is where residents go when they decide leave. Unlike inbound movers, a majority of outbound residents—roughly 54%—remain within Tennessee, taking with them $458 million in adjusted gross income. These moves reflect a sober economic calculus: households seeking marginally lower costs of living.

The income profile of those leaving reinforces that point. The typical outbound mover reported an annual income of $66,655 in 2023, compared to $72,324 for those moving in. Among those relocating elsewhere in Tennessee, incomes are lower still—averaging $64,607, or about 3 percent below the overall outbound average.

And yet, even this pattern masks important variation. Households leaving for Blount County reported average incomes of $63,089—consistent with families seeking affordable, workforce-oriented housing in areas like Maryville and Alcoa. Those heading to Loudon County, by contrast, reported $108,768—a gap that reflects an entirely different kind of mover, one drawn to the higher-end, amenity-rich communities around Tellico Village and the surrounding lakefront

Taken together, these patterns suggest outbound migration from Knox County is driven by a multitude of factors. And increasingly, that sorting reflects an unfortunate reality: for many residents, staying in Knox County is becoming less a matter of choice than of means.

Left unchecked, the pattern carries consequences that extend well beyond any one household’s decision to move. As lower- and middle-income residents are priced out, the region risks hollowing out crucial parts of its workforce—teachers, police officers, firefighters, and others—that no city can function without.

There are fiscal implications, too. From 2022 to 2023, Knox County experienced a net loss of roughly $52.8 million in adjusted gross income due to out-migration to surrounding counties in the Knoxville metro area alone. That figure overstates the short-run impact as many of those households will continue to work in Knox County, bringing their labor and spending back across county lines each day. But the longer arc is concerning.

In a similar vein, the out-of-state destinations of those moving away from Knox County offer a revealing lens on the region’s ability to retain talent—particularly graduates of University of Tennessee, Knoxville. Moves to places like Fulton County, Georgia (Atlanta) and Harris County, Texas (Houston)—where average wages are appreciably higher—suggest that many of Knoxville’s well-educated young professionals are leaving for larger, more dynamic labor markets in search of opportunity Knoxville can’t yet provide.

But the story is not uniformly one of upward flight. Moves to Chicago, Los Angeles, and Charlotte—where average incomes fall to $48,333, $61,781, and $59,302—suggest Knoxville is not simply losing labor talent to higher wages, but to the broader appeal of larger cities with dense industry concentration that draw younger, more mobile young professionals, even when the financial tradeoffs may be less favorable.

In that sense, the challenge is not just economic. Retaining talent requires more than competitive pay and career opportunity—it also requires building a city where educated workers actually want to live.

Conclusion

The data is clear about what is happening. Knoxville isn’t just growing—it’s attracting a particular kind of growth, one that is economically additive but doesn’t always reach everyone. On one hand, the inflow of higher-earning migrants is a genuine sign of strength. But it is also, in the absence of sufficient housing supply and wage growth, a source of pressure that falls hardest the types of workers the county and its economy can’t function without.

Growth and the extent of its benefits are path dependent, shaped by past choices that laid the groundwork for what Knoxville is already experiencing—and, most importantly, by the decisions we make today. There is a reality in which Knoxville gets things right: where the growth that is reshaping the county allows residents to benefit from the city they helped build.

Such decisions are not easy. Their benefits are diffuse and long-term, their costs visible and immediate. That asymmetry is the challenge: it why so many of our nation’s greatest challenges—from the national debt to aging infrastructure to the affordable housing crisis—remain nagging and unresolved. The political incentive structure almost never points in the right direction.

That’s is why, in this environment, the most consequential policy decisions require elected leaders to act against the path of least resistance—to make decisions whose benefits will be felt years from now by people who may never know who made them. That is a hard thing to ask. But it is also, at this moment in Knoxville’s history, exactly what is required.