NCPA - National Center for Policy Analysis

Wealthy People Are Not the Greatest Threat to Poor Neighborhoods

February 23, 2015

Gentrification is not to blame for the economic woes in America's poorest urban areas. Examining data taken from population and income changes in 16,000 census tracts from 1970 to 2010challenges the notion that wealthier people moving into poorer neighborhoods add to the plight of impoverished residents.

Rather, concentrated poverty creates cycles of decline where new residents are difficult to attract, investments and new jobs are absent and the cost of public services is too high to maintain.

Because of this, there is a gradual decay in population in habitually high-poverty neighborhoods. Since 1970, the population in high-poverty urban areas has decreased 40 percent.

Studying small, reasonably stable subdivisions near central business districts from all 51 American metropolitan areas shows:

  • The number of people living in high-poverty from 1970 to 2010 has increased from two million to over four million.
  • The number of high-poverty neighborhoods increased from 1,100 to 3,100 during the 40-year period.
  • 66 percent of neighborhoods identified as high-poverty in 1970 had not escaped high-poverty by 2010.
  • 91 percent of high-poverty areas in 1970 were unable to rebound to levels of poverty below the national average in 2010.

Contrary to many arguments, high-poverty areas do not suffer when gentrifiers move in. In fact, data suggests poverty is most likely to rebound when urban areas see a significant population increase. Perhaps what is most evident in gentrified urban cities is the discrepancy between wealth and poverty.

Source: Lost in Place: Why The Persistence and Spread of Concentrated Poverty—Not Gentrification—Is Our Biggest Urban Challenge, City Report, City Observatory, December 2014.

 

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