Mutual Attraction

The popular perception may be that all the jobs are moving to the suburbs. But the statistical data show otherwise.
August 2000
William Fulton
By William Fulton  |  Columnist
Director of the Kinder Institute for Urban Research at Rice University and former mayor of Ventura, Calif.

How much do cities and suburbs really need each other? This may be the biggest question in metropolitan economic development today.

On the one hand, free-marketers say economic growth occurs where conditions for it are favorable; communities within a metropolis should be in competition with one another for growth, and if central cities lose, that's okay. On the other hand, "metropolitan equity" advocates argue that an urban-suburban economic divide is bad for both social and economic conditions, as the central city will serve as a drag on the metropolitan economy.

The economic boom of the past few years has shown us one overarching trend: It is true, as the saying goes, that a rising tide raises all boats. But not equally.

A new statistical analysis by the Department of Housing and Urban Development reveals that during the recent economic expansion, central cities boomed, but not as fast as the suburbs. Between 1992 and 1997, the number of jobs located in central cities grew by 8.5 percent, reaching a total of approximately 28.9 million. But the number of jobs located in suburbs grew much faster--17.8 percent, for a total of 38.2 million.

Statistical comparisons between central cities and suburbs can be tricky, because the definition of what's a "central city" and what's a "suburb" varies so dramatically from one metropolitan area to another. Still, the new analysis reveals some interesting trends.

For example, there's a widespread belief that "elastic cities"-- cities able to annex suburban property--do better than "inelastic cities." But it turns out that the city-suburb relationship is more subtle than mere political elasticity. In Phoenix, which is the classic elastic city, jobs grew 27 percent in the central city and 51 percent in the suburbs. Meanwhile, in nearby Las Vegas, where the central city is geographically small and hemmed in, central-city job growth was 63 percent while suburban job growth was 39 percent.

The reason probably has to do with the very different structures of economic geography in the two cities. Phoenix still has concentrated job centers in the city, but jobs in general are beginning to disperse to suburban areas such as Scottsdale. Las Vegas has one massive and highly concentrated job center--the gambling area from downtown out to the "Strip." That center straddles the city line. Jobs may move back and forth, but they are not moving away.

In Southern metro areas, which are now the most rapidly sprawling in the nation, cities generally did well, but they were far outstripped by faster growing suburbs (17 percent to 42 percent in Nashville, for example). In Charlotte, however, where Bank of America and First Union have made major commitments to the downtown, central-city jobs grew by more than 20 percent, almost equaling suburban job growth.

In the Rust Belt, where jobs are perceived to be scarce, there's a huge discrepancy between city and suburban job growth. But what's interesting here is that the economic problem is the city, not the metropolitan area. In Detroit, Dayton, Milwaukee, Cincinnati, Buffalo and Rochester, the central city lost jobs, but the suburbs experienced double-digit job growth during this period. In Detroit, suburban job growth actually exceeded the national average. Metropolitan Detroit is a prosperous region; the central city is still in decline.

Hidden underneath these numbers, however, is another interesting trend. It may be a vestige from the past, but it's nonetheless still a reality at this point: Suburbs still need cities because, relatively speaking, that's where the jobs are. And cities still need suburbs because, relatively speaking, that's where the workers are.

It's true that most jobs are located in the suburbs, and the suburbs are adding jobs faster than the cities. Yet as of 1997, the suburbs had two-thirds of the workers but only 57 percent of the jobs.

There are a lot of reasons for this, not the least of which is that a good portion of the labor force has voluntarily moved from cities to suburbs over the past 40 years. (In many central cities, the population is half what it was in 1960, and the HUD study found that central cities continue to get poorer.) But in statistical terms, the labor surplus is to be found in the suburbs. In 1997, there were 1.4 workers for every job in the suburbs, but the ratio in the cities was less than 1:1. And there's some evidence that suburban residents commute inward because that's where the good jobs are: The average pay in central cities in 1997 was more than $34,000, compared with only $31,000 in the suburbs, and the gap grew slightly between 1992 and 1997.

No wonder some central city leaders are giving up on the population wars and focusing on economics instead. It may well be that the future of the cities is not about people but about jobs.