Section » Michigan Cities
One of the questions I’m now asked most frequently is “how is Michigan doing compared to other states in retaining and attracting recent college graduates?” Good question and encouraging that it is being asked more frequently. Folks seem to be understanding that where recent college graduates choose to live after college matters to Michigan’s future economic success.
To answer the question we gathered data from the American Community Survey from the Census Bureau on where 25-34 year olds with a bachelors degree or more lived in 2011 (latest available) and 2006. We collected the data for each state, metropolitan areas with a population of one million or more and their central city(s). Here is what we found:
- Michigan ranks 13th in the number of 25-34 year olds with a bachelors degree or more (for the rest of the post we refer to this cohort as young professionals) compared to 9th for total population. The state’s share of the nation’s young professionals is 2.5% compared to 3.1% of the total population.
- Michigan ranks 32nd in the proportion of young professionals with a four year degree or more. Compared to 34th for adults 25 and older with a four year degree or more.
- Most worrisome, Michigan is one of only four states to have fewer young professionals in 2011 than 2006. Declining from 346,000 to 333,000. By far the largest numerical decline. 25-34 year olds with a bachelors or more grew nationally by 13.9% from 2006-11. In Michigan the decline was 3.6%.
Nationally young professionals are concentrating in big metropolitan areas anchored by a vibrant central city (in a few metros more than one). Forty two percent of young professionals live in the 10 regions with the largest concentrations of young professionals. And in those top ten regions 35% live in their central cities.
Michigan’s low ranking is primarily caused by neither of its big metros or their central city being a talent magnet. The nine county Detroit CSA ranks, out of 54, 15th in the number of young professionals with a four year degree or more compared to 12th for total population. It is 30th in the proportion of 25-34 year olds with four year degree. The City of Detroit has 11,000 young professional residents. (Chicago by comparison has 250,000.)
The seven county Grand Rapids CSA ranks, out of 54, 48th in the number of young professionals with a four year degree or more compared to 43rd for total population. It is 34th in the proportion of 25-34 year olds with four year degree. The City of Grand Rapids also has 11,000 young professional residents.
New York Mayor Michael Bloomberg in a column for the Financial Times makes the case that talent is what matters most to economic growth. And that place –– particularly vibrant central cities –– is the key to attracting talent. The column is entitled “Cities must be cool, creative and in control”. Worth reading!
Bloomberg writes: “Many newly successful cities on the global stage – such as Shenzhen and Dubai – have sought to make themselves attractive to businesses based on price and infrastructure subsidies. Those competitive advantages can work in the short term, but they tend to be transitory. For cities to have sustained success, they must compete for the grand prize: intellectual capital and talent. I have long believed that talent attracts capital far more effectively and consistently than capital attracts talent. The most creative individuals want to live in places that protect personal freedoms, prize diversity and offer an abundance of cultural opportunities. A city that wants to attract creators must offer a fertile breeding ground for new ideas and innovations. In this respect, part of what sets cities such as New York and London apart cannot be captured by rankings. Recent college graduates are flocking to Brooklyn not merely because of employment opportunities, but because it is where some of the most exciting things in the world are happening – in music, art, design, food, shops, technology and green industry. Economists may not say it this way but the truth of the matter is: being cool counts. When people can find inspiration in a community that also offers great parks, safe streets and extensive mass transit, they vote with their feet.”
Place attracts talent. Talent = economic growth. Hard lessons for Michigan policymakers to learn. But if we want a prosperous Michigan we had better learn them quick.
One Michigan elected official who gets it is Ann Arbor Mayor John Hieftje. In a recent speech to the Ann Arbor/Ypsilanti Chamber of Commerce covered by AnnArbor.com: “One of the gaps weʼve had in Ann Arbor for years and years is we have University of Michigan students who are here but then leave town and then we have people 40 and over raising families,” Hieftje said. “But we need to attract young families and people who are starting their careers here in town.” He goes on to talk about the importance of transit and downtown living to attracting young talent.
The good news is that Ann Arbor is starting to get it. That attracting young talent matters. The not so good news is that Ann Arbor is still uncomfortable with creating high density neighborhoods. In his speech Hieftje expresses this continuing ambivalence Ann Arbor has about higher density. A key to creating the kind of neighborhoods that young professionals –– particularly before they have kids –– want to live in. As I have written before unless Ann Arbor gets over its opposition to high density neighborhoods –– in more than just the downtown –– it is going to continue to struggle to attract young talent at any scale. And as Mayor Bloomberg makes clear, that means less economic growth.
There has been good news on transit for metro Detroit. M1 –– the light rail line from downtown to midtown –– is going to be a major catalyst for future development of greater downtown Detroit. Thanks to the leadership of the Kresge Foundation and Dan Gilbert and Matt Cullen of Quicken (and other philanthropic and business leaders) its going to happen despite all sorts of barriers put up by state and local government along the way. And the Regional Transit Authority is another big step in the right direction. Particularly encouraging is the appointment of Paul Hillegonds (a Michigan Future Board member) as chair.
That said, there is a long way to go. Primarily breaking through the decades long resistance to rail transit for the region. There are two prime reasons given for no rail transit in metro Detroit. (Lets hope we are beyond race which was the major reason we didn’t get a regional rail transit system in the Seventies despite big funding commitments from President Ford and Governor Milliken.)
- There isn’t enough density for rail. Give me a break! Phoenix had density? Most of the regions that have made big investments in rail transit have done so to get density, not to serve density. (For example read this Atlantic Cities article on how rail transit is creating density in Denver.) Buses –– even bus rapid transit –– are primarily to move people. Rail is to stimulate development. High density development. It is the single most powerful lever available to create the kind of high density, mixed use, walkable neighborhoods that every region in American wants because it is where young mobile talent is increasingly concentrating.
- We can’t afford it. Of course we can, if we choose to do so. No region which has embarked on rail transit the last several decades –– and that includes nearly every big metro in the country that didn’t already have a rail transit system –– could afford it with current public revenues. But because their business and political leadership understood that rail transit was an important –– if not an essential ingredient –– to future economic growth, they sold the public, their state and the federal government on the wisdom of new revenue.
What is missing here is widespread regional business and political leadership that understands and is willing to fight for the need for a regional rail transit system. As I asked in my last post the relevant question to ask metro Detroit’s regional and political leadership as well as those state leaders who tell us that the state can’t work unless Detroit works is “how can metro Detroit compete for talent and businesses without a regional rail transit system when their counterparts across the country think rail transit is a central ingredient to regional competitiveness?”
At the same time that I was reading press reports that the powers that be have decided on bus rapid transit on Woodward from Detroit into Oakland County, Atlantic Cities ran an article on the success of the Phoenix light rail system. You read that right, no-real-downtown, sprawl-city Phoenix has made light rail a centerpiece to their regional economic growth strategy, and Detroit hasn’t. What is wrong with this picture?
The Phoenix light rail story is detailed in Alan Ehrenhalt’s The Great Inversion and the Future of the American City. Highly recommended! He writes: “In December 2008 Phoenix opened the light-rail transit system that Mayor Gordon and the business community had persuaded voters to approve by referendum earlier in the decade: a twenty mile, $1.4 billion Valley Metro train network.” The referendum approved a sales tax increase. And the region is now working on a more than six mile expansion of the already 20 mile rail system.
Phoenix and Arizona can hardly be written off as a high tax, wasteful government spending, anti-business costal city and state. The normal characterization of cities that have made a big investment in rail transit. And therefore, so the story goes, places metro Detroit shouldn’t use a model. In Phoenix, as Ehrenhalt describes, the light rail system and the tax increase that it required were anything but anti business. Business leadership was at the center of those who made the case for the centrality of rail transit to the region’s future success.
And Phoenix is not an outlier. Detroit is! Across the country –– in every region and in both red and blue states –– big metros have made rail transit a key component of their development strategy. The following is a list of metros with rail transit systems either operating or under construction. Some are on both lists. It comes from the Transport Politic. Worth checking out. I tried to edit the list and take out those who have a small center city only rail line, like the proposed M1 in Detroit and only list those who have a real regional rail system.
Its a long list. Sorry. But that is the point.
North American metros with heavy rail:
Atlanta | Baltimore | Boston | Chicago | Cleveland | Los Angeles | Miami | Montréal | New York | Philadelphia | San Francisco | Toronto | Vancouver | Washington
North American metros with light rail:
Austin | Baltimore | Boston | Calgary | Charlotte | Cleveland | Dallas | Denver | Edmonton | Houston | Hudson County (NJ) | Los Angeles | Minneapolis | Norfolk | Oceanside | Philadelphia | Phoenix | Pittsburgh | Portland | Sacramento | St. Louis | Salt Lake City | San Diego | San Francisco | San Jose | Seattle | Trenton
North American metros with rail transit under construction:
Atlanta | Calgary | Dallas | Denver | Edmonton | Honolulu | Houston | Los Angeles | Montréal | Minneapolis | New York City | Orlando | Philadelphia | Phoenix | Portland | Salt Lake City | San Francisco | Seattle | Toronto | Vancouver | Washington
These are the places that metro Detroit is going to compete with for both talent and business investment going forward. They all have and are making big public investments in regional rail transit systems. In nearly every case they have passed tax increases, with active business and political support from across the region, not just the central city.
Seems like its worth asking our state and regional business and political leadership why Detroit is not on this list. And why they think we can compete for talent and businesses without a regional rail transit system when their counterparts across the country think rail transit is a central ingredient to regional competitiveness.
Good news. Both Detroit and Grand Rapids are on Forbes list of 15 emerging downtowns across the country. Obviously good news for Michigan’s two largest cites. But, more important, its good news for their region’s and the state’s economy.
Why? Because as Forbes writes –– and we have noted repeatedly –– “One of the main factors businesses consider when deciding on where to relocate or expand is the available pool of college-educated workers. And that has cities competing for college-educated young adults. … And there’s one place this desired demographic, college-educated professionals between the ages of 25 and 34, tends to want to live: tight-knit urban neighborhoods that are close to work and have lots of entertainment and shopping options within an easy walk.” (Emphasis added.)
The reality is that the most prosperous places in the country, by and large, are big metros anchored by vibrant central cities. With the core characteristic of the central city being a high proportion of its residents with a four year degree. The all too prevalent Michigan belief that central cities are part of our past is simply wrong. As is the notion that cities are only where the poor live. College educated Millennials in particular are increasingly choosing to live in and around big city downtowns. Michigan needs it biggest cities –– Detroit primarily, but also Grand Rapids and Lansing/East Lansing –– to be talent magnets. If not, its hard to imagine Michigan being competitive in retaining and attracting the knowledge-based enterprises which are increasingly driving the American economy.
As Forbes recognizes, Detroit and Grand Rapids are making progress. But there is a long way to go. Its time for the state to make central cities a lynchpin of its economic development efforts.
The Detroit News published today an op ed I wrote about what is needed to recreate vibrant central cities in Michigan –– particularly Detroit. The op ed can be found here.
Its basic theme: “The purpose of the exercise: It is not simply to reduce the deficit, but to ensure prosperity. Solvency is vital, but it is not enough.” From That Used To Be Us by Thomas Friedman and Michael Mandelbaum.
As we enter the age of financial managers for Michigan’s major cities we need to follow the advice of Friedman and Mandelbaum. Balancing city budgets, certainly necessary, is not enough. The end game should be cities that are attractive places to live, work and play. That individuals and enterprises want to call home. And that requires adequate financing and the ability to provide basic services and amenities. Simply balancing budgets is not enough.
Getting this right matters most in Detroit. As we explored previously not just for the city but also for the region and state. If Detroit does not become a talent magnet its hard to imagine how either the region or state are prosperous in the long term.
In a recent Detroit Free Press op ed John Austin writes about a Michigan Future report he and I worked on entitled Revitalizing Michigan’s Central Cites: A Vision and Framework for Action. The report was published in 2003.
As John writes:
We said a grand political bargain needed to be made … The basic deal was this: City officials would need to make tough political decisions — namely, changing the way basic public services are delivered to be at the same quality and the same cost as those of their surrounding suburbs, and the development of a measurement system to hold them accountable; and regionalizing or incorporating many public services that could be managed more effectively or efficiently at the county, regional or state level (think transit and parks systems). In return for these changes, the state would establish Michigan’s urban cities as the priority for a variety of investments in infrastructure, housing, parks and public safety. In other words, the governor and state would wheel up some heavy financial artillery toward investing and building up core cities. They would also promise that regionalization of services and tax base had to be coupled with a tangible improvement in the quality of services provided to current residents of central cities — meaning any trade of “control” would be met with clearly enhanced services.
Obviously nothing like that happened in 2003 or in the years since. By and large actions at the state, regional and local levels have made things worse –– particularly in Detroit. Far too many central cities didn’t make the tough political choices to balance their budgets and reorganize to provide higher quality services at a competitive cost. And the state and regions didn’t make central cities a priority for public investment.
In fact state policy has made it harder to provide quality services and amenities the last decade –– particularly the last two years –– with revenue sharing cuts, transportation spending cuts and formulas that are anti urban/anti transit, property tax cuts and limitations, and the elimination of the brownfield and historic preservation tax credits.
So the predictable happened: our central cities continued to depopulate and too many of them ran out of money. What has changed since 2003 is the importance of vibrant central cites to regions and state. More so today that a decade ago strong central cities, which are attractive places to live particularly to young mobile talent, are a central ingredient to prosperous regions and states.
The fix remains the same: we need central cities which are able to provide quality services at reasonable costs and we need more investment from the state and regions to make our central cities attractive places to live, work and play. These need to be done simultaneously: its not just structurally balanced budgets or structurally balanced budgets first and then we will consider state and regional investments. But both/and. Our central cities need to be responsibly managed and we need the state and regions to make vibrant central cities a priority.
A year ago I read about someone who suggested that for those working on city revitalization, Brooklyn was a far more realistic model than Manhattan. The notion being that the assets and scale of Manhattan are not replicable. It seemed like good advice then and even more so now.
At the time I read that advice, Brooklyn was just starting its redevelopment. No guarantee that it was going to be a success story. As is clear from a recent New York Times article entitled Brooklyn’s New Gentrification Frontiers today there is no question that it is a success.
Today’s success was built on decades of pessimism. Brooklyn not that long ago was a national symbol of irreversible urban decline. As the Times writes Brooklyn’s revitalization “pushes deeper into neighborhoods that for some New Yorkers still evoke images of burned-out buildings, riots and poverty.”
Once the revitalization began, the legions of doubters maintained that it would be limited to a few neighborhoods closest to Manhattan and the water front. Think again! As the Times reports: “The median real estate price for Boerum Hill ($675,000), Carroll Gardens ($677,500) and Cobble Hill ($750,000), once viewed as out-of-the-way destinations for renters and homeowners unable to afford Manhattan, now rivals those in the northern reaches of the Upper East and West Sides and parts of Lower Manhattan, according to Streeteasy.com. … Housing prices in neighborhoods deeper inside Brooklyn are even competing with or surpassing real estate in solidly middle-class areas of Westchester County, Long Island and northern New Jersey, according to Trulia.com.”
What are the lessons we should learn from Brooklyn? The Times article demonstrates:
- People want to live in cities. The widespread belief in Michigan and across most of America that no one but the poor want to live in cities is simply out of date.
- Cities that work are first and foremost residential neighborhoods –– places where people want to live. So much so that they are willing to pay higher housing costs for high density, mixed use, walkable neighborhoods. The kind of neighborhoods only found in cities.
- Public safety and rail transit matter. People won’t live in neighborhoods that are not safe, and increasingly want rail transit to connect them to jobs and entertainment.
- Predictions that urban revitalization is consigned to a very small portion of cities –– basically downtown and near downtown neighborhoods –– should be ignored. The evidence is that there is demand for housing in urban neighborhoods beyond downtown.
Michigan’s challenge is to learn both that central cities are an essential component of prosperous states and what needs to be done to make them a reality here.