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The Downsides of the Back-to-the-City Movement

A tale of winners and losers.

Don Ryan/AP

The back-to-the city movement is a cause for celebration for some who see it as reviving previously fading cities and ushering in an era of denser, more innovative and sustainable urban growth. At the same time, it is a source of considerable concern and consternation for others who see gentrification as the main force that’s making many cities less affordable and more unequal.

But what, and who, are really behind the back-to-the-city movement? And what do the outcomes it’s ultimately producing mean for different groups or classes of people?

A new study by my University of Toronto colleague Nathaniel Baum-Snow and Daniel Hartley of the Federal Reserve of Chicago takes the deepest dive into this issue yet, tracing the back-to-the-city movement across U.S. cities and metros. Their research tracks the transformation of downtown neighborhoods (focusing on those within a four kilometer radius of the central business district) of 120 U.S. metros between 1980 and 2010.

The study generates three big takeaways that help inform our understanding of the driving forces behind, and the winners and losers of, re-urbanization.

Moving to U.S. urban centers picked up near the turn of the millennium

The back-to-the city-movement is a very recent phenomenon, having accelerated greatly since the year 2000. U.S. cities and urban areas began to decline in the 1950s and the 1960s, largely as a consequence of white flight to the suburbs.

By 1980, the study points out, downtown areas were the poorest, had the lowest education levels, and the smallest shares of white residents of any urban areas near the central business district. Over the next 20 years, gentrification was a relatively limited phenomenon, occurring mainly in cities such New York, Boston, Washington D.C., San Francisco and several others, as Hartley’s earlier research shows. In fact, during this time, both affluent and less affluent residents continued to leave cities, including educated and working class whites. This dynamic only began to change sharply after 2000, when Americans began flowing back to urban centers.

Amenities and jobs have drawn the affluent, educated, and white to the urban core

It’s clear that the back-to-the-city movement has been overwhelmingly driven by affluent and highly educated whites. In 1980, only two metros—New York and Santa Barbara—had large shares of affluent, highly educated whites living in and around their downtown. By 2010, many more cities, such as Washington, D.C., Chicago, Houston, and Atlanta, had large shares of affluent, educated whites living downtown. Between 2000 and 2010, the share of high-income, highly educated white households living in downtowns increased in roughly two-thirds of the U.S. metros the study tracked. Since 2000, affluent, educated U.S. whites have been packing themselves into areas in close proximity to downtowns, especially those within two kilometers of the central business district. The great inversion is really an inversion of affluent whites, the study points out.

Several dynamics were behind this flow of affluent, educated whites back to the urban core. One is access to the large concentration of higher paying knowledge, professional, tech and creative jobs that are located there. Another is the growing tendency for the affluent to want to locate closer to work to avoid long commutes, a concept that lines up with another recent study by the Columbia University economists Lena Edlund and Michaela Sviatchi, and Cecilia Machadoof of the Getulio Vargas Foundation.

The most important factor driving the re-urbanization of affluent, educated U.S. whites, according to the study, is access to amenities, things like libraries, museums, restaurants and cafes, a pattern documented in another recent study by the economists Victor Couture and Jessie Handbury. Re-urbanization has enabled affluent whites to simultaneously reduce their commutes, locate in closer proximity to higher paying economic opportunities, and to have privileged access to the amenities that come along with urban living.

Still, even with this back-to-the-city incursion of the educated and affluent, urban neighborhoods remain less affluent and less white than the suburbs. “White share and household incomes in central areas of cities remain well below those in the suburbs,” the study notes. Urban centers are now on par with the suburbs in terms of the share of college-educated people living there.

The people who leave or are pushed out drive demographic changes as much as, if not more than, the people moving in

As these more advantaged types have come in, lower-income, less-educated racial minorities have moved out—or been pushed out—of these areas, mainly as a result of rising housing prices. In fact, the study finds that “gentrification” is at least equally the consequence of lower income residents moving out of downtown neighborhoods as it is the affluent whites moving in. As the study points out, “while some of the gentrification in central neighborhoods has to do with population growth, most of it has to do with shifts in the composition of a declining population.”

This outflow of the less affluent is especially troubling because urban centers offer both better job opportunities and greater levels of the kinds of amenities that can help boost their wages and increase their prospects of economic mobility. The end result is growing inequality and spatial segregation as the less advantaged are pushed out of the urban core and into either suburbs or less advantaged and more economically isolated areas of the city.

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