The Midwest is Booming – Just Not Where You Think

This piece originally appeared at The Daily Beast.

The Midwest is booming, but not where you might think. Kansas City, Minneapolis, Indianapolis, Columbus, Grand Rapids, and Des Moines are the fastest-growing cities in the Midwest—lapping bigger hubs like Detroit, Cleveland, Buffalo, Pittsburgh, St. Louis, and even Chicago that are still suffering from stagnant economies and slow or even negative population growth. Read more

Suburbs Could End Up On The Cutting Edge of Urban Change

This article first appeared at The Orange County Register.

Over the past decade, the old urban model, long favored by most media and academia, became the harbinger of the new city. We were going back to the 19th century, with rising dense urban cores, greater densities and thriving transit systems.

That paradigm now lives on in myth and media, but not so much in reality. As the census data this year, and indeed since at least 2012, suggests, Americans continue to do what they have done for at least a half century – spread out, innovate and, in the process, re-create the urban form.

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What the Census Numbers Tell Us

Population growth in New York, L.A., and other big coastal centers lags that of more affordable midsize metros, where Americans are moving.

The most recent Census population estimates revealed something that the mainstream media would prefer to ignore—the slowing population growth of big cities, including New York. The New York Times, for example, trumpeted Gotham’s historically high population yet failed to mention that the city’s growth is not only dramatically slowing but also, in the case of Brooklyn, declining for the first time since 2006. New York’s rate of growth, impressive earlier in this decade, now ranks among the nation’s lowest, mostly because of rising domestic out-migration. In 2017, nearly three times as many domestic migrants left the city as in 2011. This may be one reason why rents, which have soared for a decade, have begun to flatten, though they remain at a level many potential newcomers may still find difficult to afford. <!– more –>

New York’s population slowdown is hardly unique. Many of the largest U.S. metropolitan areas have seen domestic out-migration surge over the last few years. The highest-percentage declines were found in Los Angeles, Chicago, New York and, remarkably, tech-heavy San Jose, which ranked worst among 53 metropolitan areas with populations above 1 million. Last year, the San Francisco Bay Area’s seven metros experienced out-migration more than ten times higher than the annual average since 2010. This includes the “boomtown” San Francisco metropolitan area, which attracted domestic migrants from 2010 through 2015 but saw strong net out-migration last year. At 0.60 percent, San Francisco’s 2017 population growth was half its post-2010 average. In 2017, population growth in Los Angeles was among the lowest in the nation, and at 0.19 percent, down two-thirds from its annual average since 2010.

The trend of people moving to metros with the densest urban cores—a mainstay of media coverage—is clearly over. The nation’s two megacities, New York and L.A., are shedding domestic migrants far faster than smaller metropolitan areas. Over the last year, the two coastal giants have lost domestic migrants at a rate of 0.95 percent—five times faster than metropolitan areas between 5 million and 10 million residents. Meanwhile, metropolitan areas with between 2.5 million and 5 million residents added domestic migrants at 0.14 percent, while those with 1 million to 2.5 million people grew through domestic migration at a rate of 0.33 percent. The major surprise was in the often-overlooked medium-size metropolitan areas—those with between 500,000 and 1 million people. These metros gained 105,000 net domestic migrants, far outpacing the negative 165,000 net domestic migrants for those with populations greater than 1 million.

Last year’s growth leaders among the large metros were located heavily in the dispersed metros of the Sun Belt and intermountain West—Austin, Las Vegas, Dallas–Ft. Worth, San Antonio, Raleigh, Charlotte, Tampa–St. Petersburg, Orlando, and Jacksonville. Among metros with more than 500,000 people, Seattle is the only one in the Top 25 located on either the West Coast or the Northeast—and it comes in at number 25.

Perhaps even more surprising has been the resurgence of some, though certainly not all, Midwestern metros. It may be hard for big-city elites to believe, but Des Moines, Columbus, and Indianapolis, and others are now growing much faster than New York, Los Angeles, or Chicago. One big reason: in terms of domestic migration, these areas are gaining far more new residents than are the biggest metros.

Along with the shift to medium-size metros, the Census estimate confirms a trend that, in some circles, is hard to accept: people are moving “back to the suburbs.” In 2017, the core counties lost nearly 440,000 net domestic migrants, while the suburban counties gained more than 250,000. This trend is true even in New York, where the city dominates the local economy and offers urban amenities that easily outshine those of typical urban cores. The day before the new population estimates were released, the New York Times wrote eagerly about the decline of New York’s suburbs and exurbs. But, if the editors had waited for the 2017 data, they would have stumbled on another, less-welcome statistic: in terms of domestic migration, New York’s suburbs gained five people for each one who moved to Gotham over the last year. This is a far cry from earlier in the decade, when the city routinely added more population than the suburbs.

This trend is, if anything, more pronounced in other large metros. In Los Angeles, the core-county growth rate was a thin 0.13 percent, well below the national average of 0.72 percent. By contrast, much faster growth took place in Riverside-San Bernardino, part of the Inland Empire—though much disdained for its “sprawl,” its postwar suburban development has been slightly denser than that of New York—which grew at 0.47 percent. This is especially remarkable considering California’s draconian, and profoundly anti-suburban, planning regime.

The reasons for this shift in migration patterns are varied. One likely factor is the aging of the millennial generation. As members of this large cohort enter their thirties and look to buy houses and raise families, they seek out suburbs and more affordable metropolitan areas. Many of the metros with the fastest growth are those where buying a home remains feasible for middle- and even working-class families.

Entering their retirement years, the baby boomers are also having an effect. Among areas with more than 500,000 people, Florida accounted for six of the top ten metros for domestic migration last year. Metros like Las Vegas and Boise—hotspots for retirees from California—also make the short list.

The Trump administration’s economic policies appear to benefit many Southern, Midwestern, and intermountain West metros, and may be driving population growth in those areas. Energy and manufacturing jobs are important in these areas, and policies on trade, oil, and gas development make a significant difference. Though the Bay Area and New York economies remain relatively strong, they no longer pace the nation. The Top Ten job-growth leaders in 2017 came primarily from Sun Belt metros, led by Riverside-San Bernardino, Austin, Nashville, Orlando, and Jacksonville. Other large metro economies, notably Los Angeles and Chicago, lag far behind.

These developments, though disturbing to big-city boosters, are largely positive. It’s doubtful that most residents of the Bay Area, Los Angeles, or New York want to see the continuation of breakneck population growth, with its attendant consequences of higher housing prices and rents, increased congestion, and strains on public services. Growth in Midwestern and Southern metros represents a welcome shift away from concentration, and it is sparking not only suburban expansion but also, in places like Columbus and Indianapolis, lively development of the urban core.

The new Census estimates could represent both a return to the patterns of the previous decade and the suggestion of a healthier diffusion of urban growth. One of America’s great strengths, noted Alexis de Tocqueville, lies in the vitality of its many urban centers, which allows “intelligence and power” to be “dispersed abroad.” A country dominated by a handful of expensive coastal cities might be appealing to academics, the mainstream media, and some real estate interests, but for a great continental nation, a wider distribution of growth seems far more beneficial—for the emerging metros, the overheated coastal megacities, and the people who live in them.

Landless Americans Are the New Serf Class

While home ownership remains the dream of most Americans, fewer and fewer people here can afford to own one.

For the better part of the past century, the American dream was defined, in large part, by that “universal aspiration” to own a home. As housing prices continue to outstrip household income, that’s changing as more and more younger Americans are ending up landless, and not by choice.

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The New Opportunity Boomtowns

Excerpted from an article that first appeared on Chief Executive.net.

A century ago Detroit was a boomtown and Los Angeles a sleepy refuge for sun-seeking Midwesterners. A half-century later, L.A. was the fastest-growing big city in the high-income world, while Detroit was beginning its long tailspin. In the ’70s, New York was the “rotten apple” and seemed destined for further decline. But for the past 20 years it has enjoyed an enormous surge of wealth, as have many of the countries’ dense, culturally creative cities.

In other words, when it comes to the death and life of American cities, things change, often in unpredictable, once unthinkable ways. Now, high prices and a lean to the left in the nation’s coastal metropolises could spell new opportunity for more business-friendly, less costly regions like Dallas-Fort Worth and Salt Lake City. If current trends continue, there may be new hope not only for Midwestern cities like Columbus, Indianapolis and Kansas City, but even for some long down-on-their-luck metros, like Detroit and Cleveland.

Read the entire piece at Chief Executive.net.

Joel Kotkin is the Roger Hobbs Distinguished Fellow in Urban Studies at Chapman University and executive director of the Houston-based Center for Opportunity Urbanism. His newest book, The Human City: Urbanism for the rest of us, was published in April by Agate. He is also author of The New Class Conflict, The City: A Global History, and The Next Hundred Million: America in 2050. He is executive director of NewGeography.com and lives in Orange County, CA.

Homepage photo credit: Salt Lake City, by Garrett via Flickr, using CC License.

Autonomous Cars Are About to Transform the Suburbs

This excerpt is from an article that first appeared at Forbes.com

Suburbs have largely been dismissed by environmentalists and urban planners as bad for the planet, a form that needed to be eliminated to make way for a bright urban future. Yet, after a few years of demographic stultification amid the Great Recession, Americans are again heading to the suburbs in large numbers, particularly millennials. Read more

Getting On the Road to Republican Resurgence

This article first appeared at The Orange County Register.

In his bitter attack on the new budget agreement, Sen. Rand Paul, R-Kentucky, stumbled on the reality of his party’s grim identity crisis. Since the Reagan era, the GOP represented a convergence of corporate interests, social conservatives and free market libertarians. Like Paul and the tea party, all three of these groups have lost power and influence under Trump. Read more

A Year Into Trump’s Peasant Rebellion

This article first appeared at The Orange County Register.

A year into office, Donald Trump remains something of an unlikely figure: a self-promoting and well-heeled demagogue who leads a bedraggled coalition of piratical capitalists, southerners, and people from the has-been or never were towns of Middle America. His fiercest opponents largely come from the apex of our society: the tech oligarchy, a rabidly hostile press and the cultural and academic hegemons. Read more

The Screwed Millennial Generation Gets Smart

This article first appeared at The Daily Beast.

It turns out that kids today want the same thing their parents did—a home of their own that they can afford to raise a family in.

It’s been seven years since I wrote about “the screwed generation.” The story told has since become familiar: Millennials, then largely in their twenties, faced a future of limited economic opportunity, lower incomes, and too few permanent, high-paying jobs; of soaring college debt and structural insecurity (PDF). The Census Bureau estimates that, even when working full-time, they earn $2000 less than the same age group made in 1980 (PDF). More than 20 percent of people 18 to 34 live in poverty, up from 14 percent in 1980 (PDF). Read more

The Cities Where African Americans are Doing the Best Economically 2018

This article originally appeared at Forbes.

The 2007 housing crisis was particularly tough on African-Americans, as well as Hispanics, extinguishing much of their already miniscule wealth. Industrial layoffs, particularly in the Midwest, made things worse.

However the rising economic tide of the past few years has started to lift more boats. The African-American unemployment rate fell to 6.8% in December, the lowest level since the government started keeping tabs in 1972. Although that’s 3.1 percentage points worse than whites, the gap is the slimmest on record. A tightening labor market since 2015 has also driven up wages of black workers, many of whom are employed in manufacturing and other historically middle and lower-wage service industries. Read more