State Income Tax Differentials and High-Skilled Labor Mobility in The United States: A Time Series Analysis

This study has addressed uncertainty surrounding whether state income-tax differentials influence high-skilled labor mobility or operate jointly with employment, affordability, career, remote-work, and residential considerations. Its purpose has been to evaluate how perceived state income-tax burden, expected after-tax income advantage, employment opportunities, cost-of-living considerations, professional advancement, remote-work flexibility, and quality-of-life conditions shape interstate relocation intentions among high-skilled professionals in the United States. A quantitative, cross-sectional, multiple-case-based design has been applied across high-tax, low-tax, and no-individual-income-tax state environments. From 360 distributed questionnaires, 326 have been returned and 312 valid responses have been retained, yielding an 86.67% usable response rate. Participants have represented information technology, healthcare, engineering, finance, higher education, research, management, consulting, law, and knowledge-intensive occupations. Data have been collected through a five-point Likert-scale questionnaire and analyzed in SPSS using descriptive statistics, Cronbach’s alpha, Pearson correlation, multiple regression, one-way ANOVA, post hoc comparisons, and diagnostic tests. Reliability has been strong, with construct alpha values ranging from .79 to .89 and an overall coefficient of .91. High-skilled labor mobility has recorded a mean of 4.06, while expected after-tax income advantage has achieved the highest predictor mean of 4.12. The regression model has explained 64.8% of mobility variance, R² = .648, adjusted R² = .639, F(7, 304) = 79.95, p < .001. Expected after-tax income advantage has emerged as the strongest predictor, β = .27, followed by perceived tax burden, β = .24, employment opportunities, β = .20, professional advancement, β = .18, remote-work flexibility, β = .16, cost of living, β = .13, and quality of life, β = .11. Mobility has differed significantly across state categories, F(2, 309) = 12.84, p < .001, η² = .077, with the highest mean in high-tax states, 4.22. The findings imply that retaining skilled workers requires coordinated tax, employment, housing, career, flexibility, and quality-of-life policies.