Aaron M. Renn

All Things Aaron

Population Transformation in Pittsburgh and Chicago

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Out of the 53 metro areas with more than a million people, only four lost population last year. The two biggest losers were Pittsburgh and Chicago.

Both cities are ones where a significant cadre of local boosters brush off population loss, arguing that a closer look shows that they actually are undergoing a demographic transition that is actually putting them in a stronger position. So let’s take a look.

In Pittsburgh’s case, you have a city that was devastated by the steel collapse, lost a generation of people, and now skews very old. Pittsburgh is the only metro area in the country with natural decrease in population. That is, more people are dying than being born. Pittsburgh’s natural decrease last year was -3,825. Pittsburgh also has net domestic outmigration, last year to the tune of -8,633. However, a good chunk of these are likely retirees; the top net migration destination for Pittsburgh is Florida.

However, Pittsburgh’s share of young people with degrees has been surging. It added over 50,000 of them since 2000, an increase rate of 52% that was tops in the Midwest. Their share of young adults with college degrees increased by over 14 percentage points. This is a big contrast to regions like Detroit and Cleveland, which in addition to their poor headline demographics, had low growth in young adults with degrees. Pittsburgh’s international migration isn’t particularly high at 4,359, but I believe is mostly highly educated immigrants.

Folks like Christopher Briem and Jim Russell have already written voluminously on Pittsburgh so I won’t say more.

Chicago is another interesting case. Chicago’s population problems seem to be driven by three factors, which are different from Pittsburgh:

  1. The continuing loss of black population, especially in the city but also in the region.
  2. A collapse in Mexican immigration (which had been Chicago’s biggest source of new immigrants).
  3. A significant migration loss from people making less than $75,000 per year, and especially less than $25,000 per year.

None of these forces appear to make the upscale classes of Chicago sad. You certainly don’t hear anyone sounding the alarm about black population loss, and saying that the city needs to do something about it. In fact, the city’s ineffective policing would appear to be a contributor to driving blacks out, meaning black population decline is de facto public policy.

Likewise, the community seems blasé about the collapse in immigration. We are constantly assured that a steady flow of immigrants is a necessity for urban success. Back when the immigrant flow was positive, you’d hear local boosters talk about how Mexican immigration saved Chicago, and well as the frequently cited (as it turns out) poorly substantiated claim that 26th St. was the busiest retail strip in the city apart from Michigan Ave. But now that the Mexicans aren’t coming anymore, all of a sudden it’s no longer a big deal civically.

As for the loss of lower earning population, the Chicagoland Metropolitan Agency for Planning (CMAP) published a recent study on this. Interestingly, it was timed with the census estimates release, but does not really draw on them for its conclusions on this point. It would appear that they had some of this analysis in the can, and were anticipating that the census data would be bad news. Here’s their chart:

Again, I’m not hearing people shed a lot of tears over this.

As the CMAP study indicates, Chicago has been attracting a large number of high end earners and highly educated people, especially to the North Side of the city. This part of the city is booming.

Pete Saunders has described the situation in Chicago as “one-third San Francisco, two-thirds Detroit.” (Interestingly, author Andrew Diamond appears to have jacked Pete’s formulation by calling it “a combination of Manhattan smashed against Detroit.”) The surge in high education, high income residents, combined with black population loss, a collapse in low skill immigration, and a bleed off of lower education, lower income residents should shift the ratio in the city over time, maybe towards 50% San Francisco, 50% Detroit.

That kind of demographic shift would give the city of Chicago a composition closer to those of coastal elite cities, which is probably one reason it is tacitly desired by many locals. (Increasing tax rates actually fuels this transition as well, so the fiscal mess will be an accelerant).

Beyond troubling questions of equity – see this Atlantic piece on Chicago’s divide – it’s unclear whether this is something Chicago can actually pull off successfully. For one thing, it is almost entirely a city phenomenon. Most of the positive analysis on Chicago focuses on the city proper, or even subareas of it. It’s harder to generate great stats on the region.

Weak population dynamics also affect things like the housing market. Chicagoland has more underwater mortgages than New York and LA combined. Chicago’s housing market was dead last in appreciation among major markets last year – even worse than Cleveland. Demographics will be a drag on the region in ways like this.

A more elite city in a demographically declining region and state also has downsides. Those elite sectors of the city will be called on to pay the bills for everyone else, just as happens in California and New York. Can the Greater Loop and North Side of the city generate enough wealth to pay the freight for the rest of a sclerotic Illinois? It’s hard to say.

So like Pittsburgh, Chicago is not just in demographic decline, but also in part in demographic transition. Where that leads is a question only the future will tell.

 

Comments

  1. There’s been a slight uptick in shipping and manufacturing in the southeast corner of Chicago, which has excellent multimodal freight infrastructure, and a minor pickup in warehousing and downtown-bound short-haul logistics on the West Side. But beyond that and other relatively healthy transportation hubs, I can’t imagine how Chicago would ever substantially recover our (non-municipal) working-class communities in large swathes of the city, and gentrification is bearing down on the rest.

    Brownfield construction is more expensive than greenfield construction anywhere, and the soil on the South Side is particularly contaminated. In the areas affected by absolute household loss rather than changes in household size, small ventures and single-lot home builders can’t get financing or insurance due to redlining. The schools are awful and the political and economic climate is inhospitable. Chicago is, quite frankly, used up for people of ordinary means.

    Short of Marshall Plan-scale intervention or dumping a massive captive population of refugees on the South Side, the only way I can think of to resuscitate working-class Chicago is to let parts of it go full Detroit and turn a benevolently blind eye to what goes on there, letting small holders build homes and businesses unmolested by code enforcement. But unlike Detroit we still have a patronage class of inspectors and enforcers and a gentry class to fund them, so the exodus will continue until we can no longer field them.

    • I always tell people Chicago can essentially be broken into 3 distinct segments: (1) the inner core North and Northwest-side neighborhoods; (2) the bungalow belt; and (3) the west and southeast side.

      For now, it seems the bungalow belt has held fairly steady, fueled by the City’s requirement that any employee live within city limits. The North Side (outside of what people would classify the bungalow belt) has exploded in growth, and there has been massive growth in property value (at least in terms of SFH and 2 bed 2 bath condos), and it’s hard to believe much of anyone in this area could still be underwater on a mortgage. That leaves the west and south side (again outside of bungalow belt areas), which I’d imagine have to make up almost all of the mortgages underwater identified in this post. At best, the current pace of gentrification will spill over a bit into those areas, with areas like Bronzeville, East Garfield Park, and some of the other boarder neighborhoods to the booming areas also gentrifying. BUT I agree that the other areas have a severe uphill battle, and it’s apparently a battle most current politicians don’t even want to try and fight.

      That leaves us in what seems to be pretty strange territory. Given how out-of-sight and out-of-mind the west and south side can be (I know people that have lived in Chicago for years and have never gone south of 35th Street or West of Central Park Ave.), it’s hard to imagine any of it changing anytime soon. It seems to be the elephant in the room that no one wants to talk about that lives here.

      • On its current path I think Chicago’s revitalization/gentrification will only extend as far as the city’s boulevard system on the west and south sides. Basically it will only extend as far as maybe Kedzie/Homan on the West Side, Western on the Southwest Side, and Garfield Boulevard/55th Street on the South Side. I think it’s partly because the housing stock and transportation amenities that people want are strongest in those areas, and far less so further out (the bungalow belt hasn’t hit the hipster radar and may never hit it). But it’s also partly because Chicago hipster types are still reluctant to venture into unknown neighborhoods.

        • That’s my thought too, but I’d add that urbanists are always drooling over South Shore (from a distance anyway) and there’s a pretty concerted and rather obvious effort to “take back” Woodlawn. For a while we were seeing some feverishly over-ambitious proposals for the old South Works site in South Chicago, but last I heard of that they’d settled on a more realistic manufacturing operation (for prefab housing).

          Austin on the West Side actually has pretty good bones and two L lines running through it, and I timed out once that you get to State and Lake faster from Central on the Green Line (5600 West) than where I live near Bryn Mawr on the Red Line (5600 North), but man is it a project.

          • Austin and East/West Garfield Park could each be helped by their place between gentrifying West Loop to their east and Oak Park to their west.

  2. Pittsburgh with the exception of downtown and Oakland area is very depressed and I for one am not buying the mantra that the city is “booming” and the excuses that the decline in population doesn’t matter.As pointed out above, Pittsburgh is just old demographically. It may emerge 10 years from now as a younger place but it will be significantly smaller and with the reality of where tech/finance/meds are going (who knows?) it is a crap shoot at best to think the city will be viable. I would much rather stake my claim in Raleigh or Nashville where there is real growth and there is no question as to a better demographic.

    • It sounds like you haven’t been to Pittsburgh in a decade or more. Oakland has come along nicely but is not heralded as one of the boom neighborhoods. That title clearly belongs to Lawrenceville, which had home values go up 6 fold in the past decade. People were comparing it to Brooklyn for a while but even that is old news now. East Liberty is now full of luxury condos instead subsidized apartment towers. Literally, entire blocks of ghetto high rises were torn down and the whole area has been rebuilt.

      15 or 20 years ago people in Pittsburgh wondered if it could remain “viable”. That hasn’t been the mindset for a long time. Now everyone is more concerned about economic growth making housing affordable. In terms of population, other cities are outpacing Pittsburgh. But in terms of desirability and vibrant economy, Pittsburgh is doing phenomenally well.

  3. So, successfully off-loading the old and less productive is a useful development strategy. This certainly flies in the face of those calling for ‘inclusive growth.’

    • Maybe, but only if Social Security and SSDI (disability) and SNAP and Section 8 and the rest of the safety net are properly funded.

      That might require raising or eliminating the cap on Social Security tax, while capping benefits, as well as raising income tax above $200K or so.

      The 1% might be okay with that approach, but the rest of the two top income quintiles might not be.

      • Those are state and federal level activities. I meant “useful” for municipalities and metros.

          • How does Chicago pushing the poor to leave and move down south or back to Mexico depend on social security continuing to exist?

  4. Couldn’t the arguments about Chicago be extended to Pittsburgh? How can one really resuscitate Braddock? Plus, the climate sucks, the topography makes movement challenging.

    • Hence my comment on a previous thread about Pittsburgh learning to be “The Capital of Northern Appalachia”. Again.

      Chicago figured out how to be the capital of the Midwest: finance and logistics and c-suites. But there are other large metros and universities in the region to contribute people and businesses.

      There are not other large metros and only a couple of big universities in Northern Appalachia outside of Pittsburgh. (WVU, Penn State, and a host of smaller former teachers colleges In the PA system.) UPMC has become the dominant healthcare delivery system in the region. Meds but not eds so far.

      • The problem with this notion of Chicago as the capital of the Midwest is that it really isn’t tangible beyond lip service these days. At least not in the same sense that Atlanta is the cultural and economic capital of the South, or Boston is the same for New England, and so on. In its global aspirations, Chicago has effectively distanced itself from its surrounding home region, rather than seeking to renew or reaffirm old ties running throughout it and bringing the whole region online along with them.

        I’d argue that cities like Minneapolis-St. Paul and Columbus, Ohio actually have a comparatively stronger pull and influence on their surrounding regions than Chicago does now over the Midwest as a whole. Neither of them need Chicago today as much as they might have once depended on it, and the resulting effect of this is the gradual reorientation of the region around these new de facto capitals and away from the remnants of the old Chicago hub-and-spoke order.

        Even Pittsburgh will be increasingly less able to stand on its own as a regional capital now and in the future as Columbus continues to draw away greater amounts of business and migrants from West Virginia and Western Pennsylvania–Pittsburgh’s regional watershed of influence. In a sense, Pittsburgh will join Cleveland, Cincinnati, and Detroit in becoming spokes for Columbus as an emerging de facto “Eastern Midwest/Great Lakes” capital.

        • This is wishful thinking.

          What’s in Columbus, other than OSU? It’s a tiny city — growing, yes, but not sustainably. Give it a few years and Columbus will be spent. There’s no core of infrastructure and institutions being built. Its little boom is being squandered.

          Minneapolis is larger and more important, being the home of Target, but so far removed from every major interior population centre that it’s still largely irrelevant. Denver will dominate west of the Mississippi.

          Chicago, Pittsburgh and Detroit will be the major players in the Midwest-lakes region for the foreseeable.

          • I’m curious what institutions and infrastructure you think Columbus should be building.

          • This is just resentment. In the eastern Midwest, Columbus is seen as a spoiler that has sucked up the grads and investment from real honest hardworking places like Cleveland and Pittsburgh. It’s a scapegoat for the region’s problems, instead of an example of how the region can succeed.

          • There is lots of empty space between KC or Omaha and Denver. Not so much between those cities and Chicago, MSP, and St. Louis.

          • Columbus is in the same metro size class as Nashville, Las Vegas, Portland, and Austin, and the largest city in a highly urbanized large state. The city proper is large relative to the metro. Not “tiny” at all.

    • Re c-suites: Chicago has poached from other Midwest states. Mead-Johnson and Hill-Rom from Indiana, ConAgra from Nebraska are the most recent.

      Pittsburgh’s base of HQs has been merged and rolled up. What’s left is all legacy (PNC, PPG, Alcoa, US Steel, half HQ of Kraft Heinz, the remains of Westinghouse).

  5. I think the remarks about Chicago being “blasé about the collapse in immigration” were emitted in a rather offhand manner. In fact, I think it’s near baseless and perhaps the opposite of reality. Maybe it’s what you *wish* were true?

    There has been strong pushback at the local policy and podium level–especially from Chicago–against federal deportation forces, deporting naturalized residents, imprisoning children and pregnant women indefinitely and federal policy initiatives that aim to reduce both high and low skilled immigration.

    More specifically, every Chicago booster I encounter has said positive things about African immigration to the north shore, Indian and Chinese immigration and laments the decrease in Mexican immigration.

    • Agree with this.

      I do agree with Aaron that the Chicago “elite” has probably been a bit quiet, and perhaps even celebrating, the de-migration of black people away from the city and region.

      But he is way off on the immigration thing. The slowdown in immigration is very much a concern. Local media actually celebrates ethnic communities and their growth (just today’s Tribune talks about the growth in Asian/Indian businesses in Naperville) and there has been a slew of articles talking about the growing Chinese communities in the SW side and in Bronzeville.

      Nobody is Chicago is celebrating the slowdown in Mexican immigration. Immigrants are viewed nearly across the board as a good thing.

      • Mexican immigration is now a problematic savior for various reasons. Unfortunately, there is no longer the same massive line of Mexicans waiting to get into the US as there once were. In fact, I understand that many people “crossing the border” into the US are actually from Central American countries. Mexico is still a poor country overall, but the standard of living there has evolved greatly in the last 30 years. Cars, TVs, etc are all commonplace now. The new Central American folks never evolved strong networks in Chicago as the Mexicans did, so they are heading to other cities where they can land more comfortably.

        Meanwhile, Chicago’s Mexican community, largely cut off from a fresh flow of poor folks “fresh off the boat”, is slowly becoming wealthier, assimilating, and suburbanizing. It’s hard to see this because the middle-class Mexicans that worked their way up are now making their housing decisions in parallel with white folks, there’s not much clustering. They’re buying big new houses out in Plainfield and their kids in their 20s are renting apartments in Humboldt Park and Avondale.

        I’m not sure what Chicago can do to capture a greater share of other growing immigrant flows from Asia or the Middle East. Much of this is obviously out of the city’s control, governed by national policies and politics.

  6. I don’t know about the proper fraction or percentage to assign, but I think Chicago is also Queens in the NW side and Los Angeles in the SW side.

    To be fair, some elites might be blase even cheery because of the fact that the 2 strongest (by %) challenges to Emmanuel came from Mexican-american pols. Also factor in the payback that many wanted against the HDO (Hispanic Democrat Organization) once their patron Daley was out of office.

    Recent police deployment changes have sort of ramped down on the black-on-black “Englewood/Austin” kind of crime, but there has been a noted rise in carjacking and armed robberies in traditional low crime areas.

    • I’ve tried to explain Chicago’s loopy politics and scattershot demographic and economic indicators, and the best I can come up with is “Imagine if they jammed Boston, Minneapolis, Cleveland, Detroit and El Paso into the same city…” But that doesn’t cover everything either.

  7. Have to say this is one of the better write-ups I’ve seen on the issues facing Chicago in relation to population loss, and how the City has dealt with it (or more accurately not dealt with it). For whatever reason Chicago media itself dances around the issue, though the numbers coming out not back up what people could see anecdotally just by looking around.

    Parts of this City are booming, while other parts are slipping even further behind. 50% San Francisco/50% Detroit is pretty accurate, and it’s increasingly hard to argue it’s not by design from the political elite in this town.

  9. I think Chicago and Detroit are on similar paths, or converging, but the stories play out differently in each city. In Detroit people are celebrating the city’s downtown rebound but are wary of what’s next for the city’s neighborhoods. In Chicago people love the Loop and north lakefront, but wonder why its boom hasn’t touched more of the city. I’m beginning to believe both will follow a similar trajectory that most will later discover to be truly Rust Belt-ian in character:

    1) Booming and growing new economy cores and inner neighborhoods;
    2) Collapsing and emptying outer neighborhoods, formerly housing (mostly black) manufacturing workers

    Stretch this trajectory out. Chicago, Detroit and Rust Belt cities like them will ultimately be smaller and whiter, maybe not with a white majority but with a plurality. They’ll also be noted for having a “no man’s land” between the booming and collapsing areas. Why? Because there’s always going to be some trepidation about moving into “sketchy” areas in Rust Belt cities that surpasses that of the coastal cities, and people facing that choice would prefer to either build up the strong areas (YIMBYism) or move into depopulated “sketchy” spots.

    • I don’t necessarily disagree, but Chicago’s boom isn’t limited to just the Loop and a handful of inner-ring neighborhoods. The boom pretty much encompasses 1/3 of the City. The bungalow belt areas, which are doing fine, represent another 1/3. That leaves you with about 1/3 that is extremely depressed, with little to no chance of revival, with 2/3 of the City either doing well or being extremely prosperous. Detroit is at best a reversal of those figures (and I think saying even 1/3 of Detroit is booming is being extremely generous). I think Chicago is going to end up feeling like NYC or San Francisco felt 20 years ago—extremely wealthy areas, with extremely dangerous areas. The problem with that is it feels like we’re the only major city moving towards that dynamic rather than away from it.

      • Converging. I see Chicago and Detroit as moving toward a similar demographic profile but from different starting points. That’s good news for Detroit, but actually bad news for Chicago.

        You’re right to say that it would be generous to say 1/3 of Detroit is booming; a tenth is more likely. But it’s trending upward. You suggest that beyond the 1/3 in Chicago that’s booming, another 1/3 is OK while the last 1/3 is struggling. I’d say the middle 1/3 in Chicago is doing less than OK. They’re in transition, trending downward, and are closer in profile to the struggling areas than the booming ones.

        Using Aaron’s formulation above, if Chicago looks like “50% San Francisco/50% Detroit” in 20 years, and Detroit does the same, which one looks like the economic winner over that period?

        • None of this is an exact science, but I see little chance that Detroit gets to 50% San Francisco-level prosperity in 20 years. Nor is Chicago likely to see 50% of itself turn into the type of Detroit-level depression we’re actually discussing.

          I’d disagree that the middle 1/3 in Chicago is on a decline, and I’d go as far as arguing a good chunk (especially areas on the North Side like Jefferson Park, Portage Park, etc.) are actually seeing decent growth in property values. Maybe there’s some slippage in the South Side belt areas, but I’d still say it’s doing OK as a whole even in those areas. The bungalow belt areas are well funded in terms of services, and have decent schools, so as long as Chicago keeps a residency requirement for municipal workers, those areas (which feel like suburbs) are going to keep chugging along I think.

          Conversely, the very depressed areas, like Austin, West Garfield, Englewood, North Lawndale, large swaths of the south east side outside of Hyde Park/Kenwood, are clearly getting worse—both in terms of crime increasing, and jobs disappearing. The weird thing with Chicago is that because it’s so segregated, it’s entirely possible to visit Chicago, see all the boom, and veer even realize those areas are as depressed as they are. Until recently, even with the extreme crime numbers, you saw minimal spill over into prosperous areas of the City. When you did start seeing spillover in 2016 to present, the City finally started taking it seriously, and has gotten the numbers down to a degree.

          • OK, admittedly a little hyperbole about Chicago and Detroit’s futures over the next 20 years. We can’t say with any certainty whether either future is likely, but both are possible.

            I don’t think residents of Chicago’s prosperous core really know how bad the worst places are, or how tenuous is the existence of the ones in the middle. Conversely, I don’t think Detroiters realize how quickly revitalization could ignite and spread, given the right economic catalyst.

            Consider both core cities. Chicago’s a city that’s reasonably intact and has had new economy growth for a generation, but people are still leaving because they haven’t benefited. Detroit’s a city with a newly blossoming core, an empty quarter and a struggling periphery. It’s entirely conceivable that the empty quarter becomes the blank slate that allows for a very fast spread of revitalization.

            It could happen.

    • This is absurd.

      What you are failing to take into account is that Chicago’s wealthy areas aren’t just stable. They are thriving. The city is getting richer and more educated.

      There is nothing that suggests that Chicago and Detroit are converging. A very incorrect read of present data.

      And while immigration has indeed slowed down a lot, Chicago still gets a lot of immigrants. WAY more than any other Midwest city.

      Will the slowdown last forever? A region of over 9 million may eventually return to historic immigration norms. But I guess we will see

      • I stand by what I say. But anyone’s perception of Chicago’s future depends on where you’re standing when you make that assessment.

        Chicago’s wealthy areas are indeed thriving. But they account for less of the city than most people think — a third of the population and households is probably accurate. Areas adjacent to the wealthy neighborhoods are stable, but in a tenuous position, and they’re another third of the city. And they’re in a tenuous position because the last third of the city is struggling massively; for the stable areas, it’s an open question as to whether they’ll become the next hot spot or the next to fall into the hole.

        As someone very familiar with both Chicago and Detroit, I get it that Chicagoans can’t find any reason to compare themselves to Detroit in any way. But suggesting that the divide between the two is vast simply overstates what’s happening in Chicago and understates what’s happening in Detroit.

        • And I stand by my statement that your suggestions are absurd.

          The only areas of Chicago that are struggling are the historically black areas.

          The central area and north side are performing exceptionally well. They are also gaining residents as a whole. But that’s not all.

          Asian areas are gaining residents.

          Hispanic areas are more stagnant, but they are facing gentrification.

          Black areas are in free fall, with a couple of exceptions.

          And HQ are moving downtown in droves. Chicago’s central area is becoming a city to itself.

          Now let’s look at Detroit:

          1. Nothing even remotely close to a sizable central area with 24-7 bustle

          2. It doesn’t even have a Latino population or huge Latino districts remotely the size of Chicago’s

          3. The city’s black districts ARE the majority of the city, and like much of Chicago’s are still in free fall

          4. Detroit doesn’t even have sizable Asian/Indian districts like Chicago does.

          Your whole argument is just delusional nonsense. Chicago now has the highest proportion of its residents with a college degree among the largest US cities. Chicago and Detroit are actually diverging, not converging.

  10. There are some wild and totally unsubstantiated claims and predictions here. Are we unable to have realistic and meaningful discussions about these things anymore?

    • You are doing no service to your arguments by calling people who differ from you “Chicago boosters”. It’s insulting, really. As if I have an agenda.

      Furthermore, what a Chicagoan doesn’t know about the dire conditions you are talking about? The media talks about industrial job losses, murders, and overall bad conditions on parts of the south and west sides every. Single. Day. We are aware. Nobody is celebrating this.