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Thursday, April 9th, 2009

Job Sprawl and Other Midwest Miscellany

A lot of articles this week on the Brookings Institution study on “job sprawl”. That is, they surveyed cities and calculated the percentage of jobs within certain radii of the CBD. A number of the cities I cover made the list.

Notably, Detroit had the most job sprawl in this study, with 77.4% of its jobs greater than 10 miles from the CBD. Chicago was #2 with 68.7%. I think this goes to show one of the challenges of the study, namely that it punishes “unbalanced” metros whose CBD’s abut a border. Detroit’s CBD is on an international boundary and only the US jobs are counted. Similarly, Chicago’s CBD is on the lakefront and which limits development to the east. I saw a graph someone did of Detroit with jobs within a 10 mile radius of the population center of the region, and most of the major jobs centers fell within the ring.

Still, I think this is a useful study. It harkens back to my post “Could Marion County Implode” about Indianapolis. A ten mile radius from downtown Indianapolis is basically the core county. And most of the job growth is now outside of that. From 1998 to 2006 the percentage of jobs outside of the 10 mile ring increased from 27.8% to 33.6%, falling into the “rapidly decentralizing” category. This is Not Good. Forget the loaded term “sprawl” for a minute. Consider only that the jobs and associated economic and tax base growth are now outside the city/county and you can see where this is headed. Last year about half of all new office space constructed in the metro area was in the suburb of Carmel. The city is battling a slow but inexorable attrition in its share of regional economic and demographic activity.

In the greater Midwest I talk about, Louisville actually ranked as one of the top ten most concentrated metros in this study. The challenge for Louisville is that, IMO, this ranking is due primarily to its smaller size versus others, and once Jefferson County is “full” in 10 years or so, it will start to see the same effects.

In other news, Carol Coletta gives her report from the Global Cities conference in Dubai. My absolute favorite part was the Tweet summary she gave of one presentation, “Every city has a rich history or it wouldn’t be a city. Therefore, ‘rich history’ is no brand differentiator”. There is more great wisdom in this tweet stream than I’ve seen in a while. It goes straight to the BS strategies most cities try to use to improve themselves.

The New York Times asks guest bloggers what to do with abandoned malls.

Ed Glaeser argues that competition saved New York.

An interesting commentary on “failure and risk” from the Global and Mail.

The Detroit city council voted to approve demolishing the long vacant Michigan Central Depot and billing its billionaire owner for the expenses. I guess they got tired of it being on the standard “ruins of Detroit” tour.

Borderline NSFW site viceland.com has a hauting photo series on Detroit called “School’s Out Forever“. (The series photos are fine, but I can’t promise for the rest of the site).

Remember how I talked about how the Indianapolis Museum of Art had a great strategy? Here’s another data point as the New York Times features their launch of the Art Babble site. There are at least five mentions of “Indianapolis”. When was the last time that happened in the NYT outside of the sports page?

I notice that Ed Morrison has a wiki site up called “Map the Mess” about Cleveland.

More Midwest

Chicago
Chicago’s Magnificent Mile Hits a Rough Stretch (WSJ)
A $6 billion hole in the ground (Tribune)
RTA outlines plan for unified fare system (Tribune)

Detroit
Detroit: A city in crisis (Toronto Globe and Mail)
Selling off America’s manufacturing might, one factory at a time (Charlie LeDuff @ Detroit News)
Can Detroit be retooled (Time)
Officials hope Final Four will bring lasting benefits to Detroit (Washington Post)
Area roads need repairs after just 10 years (Detroit News)
Take high road and build two bridges (Free Press)

Indianapolis
New web site hopes to attract young professionals (press release)
High end local restaurants make a new farmer’s market (Indy Star)

Kansas City
Project aims at congestion at I-70 and I-435 (KC Star)

Milwaukee
Senator tries to cut off I-94 expansion (Daily Report)

Twin Cities
Road cones about to sprout all over Minnesota (Star-Tribune)

17 Comments
Topics: Economic Development, Regionalism

17 Responses to “Job Sprawl and Other Midwest Miscellany”

  1. CARR says:

    I wasn’t to quite surprised that Louisville was in the top 10. We are a relatively small city, and out largest employer UPS (15k employees) is fairly close to the CBD.

    However, I don’t expect out ranking to change that much even as the outer counties continue to grow. The main reason is that one of our largest employers Humana is about to add an additional 400-500 jobs, and all of those will be in the CBD. Louisville has done a pretty decent job of attracting and trying to attract jobs to the CBD.

    I’m surprised that Indy didn’t do a little bit better. I thought being a state capitol would help to balance the exodus of jobs.

    russellneighborhood.blogspot.com

  2. The Urbanophile says:

    CARR, I wouldn’t be so sanguine about Louisville if I were you. The pattern seems to be universal. The good news is, Louisville has time to get fit for the race and make sure Jefferson County remains a premier place to live, work, and do business.

    As for Indianapolis, unless Marion County changes course, a 1/3 to 1/2 chance it’s all over. Just my opinion, of course.

  3. Alon Levy says:

    The Brookings data is at odds with those of Virginia Tech’s Robert Lang and Jennifer DeFurgy who, writing for Fannie Mae, found that Chicago had the second most concentrated job distribution among large US metro areas, after New York.

  4. Paz says:

    How are Phoenix’s/Salt Lake’s/Las Vegas’ numbers so good? Is the CBD spread out over a larger area? If so, shouldn’t they have compensated for this somehow?

    Also, this was a great post. Excellent amalgamating.

  5. Anonymous says:

    When/if the east end bridge is built it will open up 20% of the metro area that is not easily accessible. That will contribute to further job sprawl. Whether Jefferson County/CBD are able to hold their own/grow will be interesting to see.

    The net/net is likely to be substantial job growth in the metro area because:
    1) CBD is strong and getting stronger
    2) East End Bridge opens up large chunks of southern Indiana for development
    3) East end Ky suburbs will continue to grow
    4) Airport area continues to grow
    5) Ft. Knox expansion serves as growth engine for southwest burbs.

  6. thundermutt says:

    There are some holes in this study. Cleveland is counted as “rapidly” decentralizing when the share of jobs beyond 10 miles increased by only 2.5% over an 8-year period. That doesn’t seem rapid to me, compared to the 8.5% change in Phoenix.

    Further there’s a “first premise” problem: the study measures share of jobs, not absolute growth. For example, Indianapolis’ total jobs “inside 10 miles” is still growing. Growing slowly (1.6% over the study period), but still growing.

    Damaging to Aaron’s “potential for implosion” argument is that the highest job-growth areas of Marion County (Park 100/Intech Park and Lawrence/Ft. Harrison) are just outside the 10-mile ring but well inside Marion County.

    The examples of “implosion” or “ripe for implosion” would be the metros who have actually lost jobs AND share inside 10 miles. And yep, here they are: Cleveland, Dayton, Detroit, Greenville SC, Lansing, New Orleans, Sarasota, Syracuse, Worcester MA, Youngstown.

    And this one, too: San Jose.

    (I don’t think we’d say Silicon Valley is “imploding”; it’s obviously some kind of special case. And even though New Orleans implosion has something to do with natural disaster, it does have a significant man-made component to it: people are not reestablishing jobs there because of the risk. Different kind of risk than Detroit, but the resulting implosion is the same.)

    I think this study is a better after-the-fact documentation of implosion than a predictive tool.

    A better predictive tool, IMO, would be a different manipulation of the raw data behind these numbers: actual growth rates in jobs for each ring. Once a ring tops out and goes negative, there is probably a window of opportunity to reverse the problem before decline becomes irreversible. And that takes a while, so the window might be big.

    Detroit and Cleveland have gone through long (30-50 year) declines with some “bear rallies” before reaching the edge of implosion. So nothing is inevitable.

  7. Donna says:

    “Every city has a rich history or it wouldn’t be a city. Therefore, ‘rich history’ is no brand differentiator.”

    This is absolutely true, though I find it painfully ironic that this statement was made while standing in the middle of DUBAI.

  8. Alon Levy says:

    Thundermutt: Silicon Valley looks exactly the opposite of any other metro area, with San Jose being a bedroom community to Palo Alto, Mountain View, Sunnyvale, and other major high-tech cities. The CBDs of Silicon Valley are all located in edge cities rather than in a traditional downtown, which makes radius-based computations of centralization difficult.

  9. Anonymous says:

    It is true that each city may have its own history…however, it is also very true that very history can be a differentiator.

    Applying this to the USA…where the history, while rich, is not on the same planet vs European or Asian cities…

    Of todays major metro’s how many were considered major 200 yrs ago? 100 yrs ago? 50 yrs ago?

    I think Boston’s history is a huge differentiator for it vs say Las Vegas or Phoenix or any city that was not considered ‘major’ prior to 1900.

  10. Alon Levy says:

    Anon: of course, cities like Boston and New York make use of their relatively old history. But there are many equally old cities that are urban footnotes. Charleston was the 4th largest city in the US in 1790, but is now ranked 77th by metro size and has nothing of special interest to urbanists. Salem, Massachusetts celebrates its history with witchcraft references, but is still a small suburb of Boston. And Cincinnati is the oldest major city in the Midwest, but still has none of the bohemian and artist cultures that have sprung up around everything in Manhattan older than 120 years.

  11. CARR says:

    Urbanophile,

    The pattern is universal, but one thing Jeff Co. and Louisville have going for it is it’s relatively small size. A 10 mile radius from the CBD covers a ton of area in Louisville/Jeff Co.

    Concerning the East End bridge and the development that it will spur. I’m not even sure they will build the damn things. They’ve only been talking about it since the 60′s and 70′s. I will be surprised if it happens in the next 10 years. If it does happen then you will see a steady exodus of jobs out of the county, but I don’t think to a very large degree.

    Oldham county has experienced a ton of residential growth, but the businesses have yet to follow in any great numbers. I know that will change as more and more burbs are built, but I think it will take another 5+ years before you see a substantial number of large businesses follow.

    Bullet Co. has a large number of factory/warehouse jobs right off of I-65. I can see that trend continuing, but the city is planning on adding more warehouse space next to the airport.

    Eventually, it will happen. More jobs will move further and further out. I just don’t think it’s going to happen at the rate that it is happening elsewhere.

  12. thundermutt says:

    Alon, I agree: the San Jose “metro” is pretty artificial, made up of a string of edge cities. Whether it is truly a separate “metro” is a matter of some debate; likewise, whether there are really three separate metros in the Bay area.

    I think the California mega-metros (Bay Area and SoCal) are so diffuse that any attempt to divide them into separate metros, or to measure sprawl from a “center”, is doomed to failure. They are the very definition of long-term car-culture sprawl.

    I think this study “measures” a “DUH” phenomenon: growth of US metros is largely at the edges. Even in Portland.

  13. Lynn Stevens says:

    Regarding “unbalanced” metros, major waters/international boundaries could also favor the numbers by protecting job sprawl from fanning out in the direction of the boundary.

    Not that I’m an advocate for any kind of sprawl, but job sprawl could be a function of city success(businesses are priced out), and/or city failure e.g. a failure of an urban school system (residents move out, businesses move out to accommodate a CEO or to attract employees with a shorter commute).

    With study focus on radius from CBD, we have to recognize distinctions. City is not the county, nor the metropolitan area, nor necessarily the population center.

    Detroit is a relatively large city geographically (“8 Mile” of movie fame is 8 miles from CBD and the northern edge of city boundary, and there are other areas within the city further than 8 miles from CBD) yet has only about 20% of the MSA’s population. The city is not the population center.

    Similarly, much of Chicago’s troubled, underutilized south side is greater than 10 miles from CBD.

    Sad to learn of the plans to demolish Michigan Central. It’s still beautiful in its ruins. In fact, Detroit might capitalize on such ruins as tourism!

    Was in Detroit area over Final Four weekend. At least there was something to be excited about with State in the competition!

  14. Alon Levy says:

    Lynn: there are ways of distinguishing the two kinds of sprawl. Jane Jacobs suggests looking at residential space per capita (or commercial space per job). A neighborhood that loses people or jobs because of high prices or overcrowding will see no reduction in total residential/commercial space, leading to higher space per capita. A neighborhood that loses people because of a crisis will see a lot of its buildings demolished or remain vacant, so the amount of space per capita will not increase.

    Other ways of comparing the two forms of population/job loss is to look at rents or housing prices, or at average incomes. If the jobs that are pushed out are those that can’t afford to pay the higher rents then we should see a higher share of upscale jobs.

  15. thundermutt says:

    Alon, I don’t think that works out exactly. In the Rust Belt, many older factories are located near the urban core. There’s a lot of square feet per job in such manufacturing facilities.

    Some of those plants do relocate to greenfield sites because they’re inefficient. Others simply wither and die as their owners milk them, since even a greenfield site can’t compete with China in some basic processing industries.

    Ultimately the relatively high-wage manufacturing jobs are replaced (often in the same building) by clerical and administrative jobs. Payroll on the site might not change even though population density of workers increases. In other words, average wage per job decreases even as total payroll remains constant.

    In sum, while this is a local-space issue, it is not divorced from macroeconomic forces. That sometimes leads to counterintuitive results, such as average-wage declines on old-factory sites near the urban core.

  16. Alon Levy says:

    You’re right that the space per capita computation doesn’t work so well for manufacturing as for residences and offices. But you can still use other metrics, like average income. The case where high-paying manufacturing jobs are replaced with low-paying clerical jobs is a very widespread problem of deindustrialization; the places that do well are those that can add new high-paying work instead.

  17. Anonymous says:

    I actually think the CBD is useful in a Chicago sense. You talked in your CTA proposal about focusing funds on Chicago proper. But, the CBD suggests that jobs are growing out in the burbs, thus Metra is quite important also, especially in the reverse-commute sense. If jobs weren’t growing out in the burbs, then focusing funds on Chicago proper seems more justified.

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