JPMorgan Chase CEO Jamie Dimon warned that New York City and other cities with high taxes and regulatory burdens run the risk of losing businesses and workers to locales with more hospitable business climates.

Dimon released his annual letter to shareholders on Monday in conjunction with the firm’s 2025 annual report and said that companies need to weigh the benefits of operating in places like New York City against areas with lower taxes on businesses and individuals.

“No matter who you are, you need to deal with reality and the truth. The truth is that while New York City has much going for it, particularly for financial companies (because of extraordinary local talent), it also has the highest city and state corporate taxes and the highest individual income and state taxes,” Dimon wrote.

“People often make this a moral or loyalty issue, but it is not. Companies need to remain competitive in this very tough, fast-moving world. And higher taxes lower returns on capital and less competitiveness by their nature,” he said.

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JPMorgan Chase CEO Jamie Dimon said that cities and states have to compete to keep businesses in their jurisdictions. (Alexander Tamargo/Getty Images for America Business Forum)

Dimon said while companies relocating their headquarters or significant aspects of their operations to states with more favorable tax and regulatory regimes may be easier to track, those shifts happen at the employee level as well and can amount to significant moves for the workforce.

“Additionally, individuals vote with their feet – you can already see a fairly large exodus of people and jobs out of some states with high taxes and high expenses (often due to high taxes and regulatory burdens). Sometimes you see companies leaving states, but migration also shows up in shifts of employees out of certain states,” Dimon wrote.

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JPMorgan Chase has expanded its presence in Texas while its headcount has declined in New York City. (Tim Clayton/Corbis via Getty Images)

He explained how that dynamic has played out at JPMorgan, which has expanded its footprint in a low-tax state like Texas and will probably continue to do so.

“For example, while New York City is still our company’s global headquarters, we have shrunk our headcount in the city, from 30,000 a decade ago to 24,000 today, and increased our headcount in Texas, from 26,000 in 2015 to 32,000 today. This trend will likely continue,” Dimon said.

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The JPMorgan CEO said that he has seen an exodus of corporations out of New York City before that was driven in part by the business climate, adding it can pose significant problems for city governments.

“Sometimes this can be a disaster for a city. I am reminded that in the 1970s, nearly half of the 125 Fortune 500 companies based in New York City left,” he wrote. “While mergers accounted for some departures, the price of doing business in New York City accounted for most: cost of taxes, office rents, labor and so on.” 

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“No city – or company or country – has a divine right to success,” Dimon added.