Urban Decline

Bracing article from the New York Times.

An excerpt.

“On the last day of February, Glen Lee, the chief financial officer of Washington, D.C., issued a warning to the mayor and members of the District of Columbia Council, who are undertaking such costly ventures as free bus service and expanded affordable housing.

“The Covid-19 pandemic,” Lee wrote, “has brought about significant changes in the District’s population and economy, with potential long-term implications.” Revenue estimates, he said, have “been lowered due to 1) a more pessimistic economic outlook; and 2) a deteriorating real property market.”

“In Lee’s view, there are still more danger signals:

“Recently completed preliminary real property tax assessments, which is the basis for FY 2024 real property tax revenue, are lower than anticipated, and year-to-date revenue collections through January for deed and unincorporated business taxes, both of which are gauges of strength of the real estate market, are drastically lower than last year.”

“Washington is not alone. Most of the nation’s major cities face a daunting future as middle-class taxpayers join an exodus to the suburbs, opting to work remotely as they exit downtowns marred by empty offices, vacant retail space and a deteriorating tax base.

“The most recent census data “show almost unprecedented declines or slow growth especially in larger cities,” William Frey, a demographer and senior fellow at Brookings, emailed in response to my query.

“From July 1, 2020 to July 1, 2021, “New census data shows a huge spike in movement out of big metro areas during the pandemic,” Frey writes in an April 2022 paper, including “an absolute decline in the aggregate size of the nation’s 56 major metropolitan areas (those with populations exceeding 1 million).”

“This is the first time, Frey continues, “that the nation’s major metro areas registered an annual negative growth rate since at least 1990.”

“The beneficiaries of urban population decline are the suburbs.

“Frey writes:

“The combination of domestic migration, immigration, and natural increase led to a different outcome in the suburban counties of major metro areas. There, domestic migration increased through mid-decade to a fairly constant level from 2015 to 2019. It rose after that, especially dramatically during the prime pandemic year of 2020-21, in large part due to an increase in city-suburb movement.

“Even more damaging to the finances of major cities is the fact that the men and women most likely to move to the suburbs are among the highest-paid key sources of income and property tax revenues: workers with six-figure salaries in technology, finance, real estate and entertainment. Those least likely to move, in turn, are much less well paid, working in service industries, health care, hospitality and food sales.

“There is a striking interaction between the Covid-driven exodus from the cities and changing racial and ethnic urban populations. From 2020 to 2021, the nation’s 56 largest metropolitan areas saw a 900,000-person cumulative decline in their white populations, Frey reports.

“In an August 2022 essay titled “White and youth population losses contributed most to the nation’s growth slowdown,” Frey writes that, of the metropolitan areas with populations in excess of one million, “43 saw absolute declines in their white populations. Sixteen saw absolute declines in their Black populations, and six saw declines in Latino or Hispanic and Asian American populations.”

“In the period 2020-21, the white population of the New York-Newark region fell by 222,530, compared with a 39,363 decline among Hispanic Americans, 53,763 among Black Americans and 11,485 among Asian Americans. There were very similar patterns in Los Angeles-Long Beach, Chicago-Naperville-Elgin and Philadelphia-Camden-Wilmington.

“In the decade before that, 2010-20, the minority population of big cities grew substantially, driven by a 1.5 million increase of Latinos and a 1.2 million increase of Asian Americans, while the Black big-city population declined by 129,807, according to Frey. The population of whites in big cities grew over those 10 years by a modest 239,378.

“The question facing large cities, especially the older “legacy” cities in the North, is whether they can break what urban experts now call an “urban doom loop.” The evidence to date suggests that things are not improving much.”

About David H Lukenbill

I am a native of Sacramento, as are my wife and daughter. I am a consultant to nonprofit organizations, and have a Bachelor of Science degree in Organizational Behavior and a Master of Public Administration degree, both from the University of San Francisco. We live along the American River with two cats and all the wild critters we can feed. I am the founding president of the American River Parkway Preservation Society and currently serve as the CFO and Senior Policy Director. I also volunteer as the President of The Lampstand Foundation, a nonprofit organization I founded in 2003.
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