The booming national economy and the growth of high-tech jobs have helped to reverse decades of decline in America's cities, but the recovery has driven up home purchase prices and rents. The State of the Cities 2000, recently released by HUD, describes this worsening affordable housing shortage as well as the strong and sustained growth in high-tech and other employment, business creation, and homeownership. The report points out that during the economic expansion, wage growth in cities has surpassed that of their surrounding suburbs. "Cities are enjoying the benefits of the longest and strongest economic expansion in our history, but many are still not full participants in the new prosperity that has swept across our Nation," says HUD Secretary Andrew Cuomo. "In these times of good economic news and budget surpluses, it makes sense to invest in cities to help them create more jobs, more businesses, more affordable housing, and increased homeownership." Despite the strong recovery by cities, suburban growth continues to outpace urban growth, especially in the important high-wage, high-tech industries. As one example of the Digital Divide, the report finds that the number of high-tech jobs in the suburbs is growing 30 percent faster than in central cities. The State of the Cities 2000 identifies four megaforces that are shaping the future of the Nation's cities and presents findings showing their impact. The first is the new high-tech, global economy that has driven the recent economic expansion in the United States. New technologies in information and telecommunications—coupled with greater productivity—have produced record economic gains. New HUD data find that high-tech employment is growing faster in the suburbs than in cities, but that the proportion of new jobs that are high-tech is larger in cities than suburbs. Major demographic shifts are under way that will have significant economic, social, and political implications for both cities and suburbs. Although an increasing share of residents in both cities and suburbs are aging, a disproportionate number of the elderly poor live in cities. At the same time, cities and suburbs are becoming more racially and ethnically diverse. Between 1980 and 1998, the percentage of minority groups in central cities rose from 34.8 percent to 46.9 percent. During the same period in the suburbs, the proportion of minorities increased from 13 percent to almost 23 percent. The third force is the housing challenge that is presenting new threats to housing affordability. As increases in the cost of housing surpass the rate of inflation, economic good times are creating a housing crisis for many Americans. The economic growth that is pushing up em-ployment and homeownership is also driving increases in rent more than one-and-a-half times faster than inflation and creating significant increases in home prices as well. Of the 25 metropolitan areas identified as high tech, all but 4 had rent increases greater than inflation. Rents increased by more than 20 percent between 1995 and 1999 in Denver and the San Francisco Bay area and rose by more than 15 percent in Atlanta, Boston, Chicago, Kansas City, San Diego, and Seattle. The economy's advances in information technology, coupled with rising incomes, population growth, and infrastructure spending patterns, continue to drive residential and business development to the fringe of the cities. Between 1990 and 1998 suburban population grew by 12.2 percent, compared with 4.7 percent for cities. Only 38 percent of Americans now live in central cities, compared with 45 percent in the 1970s. This continued decentralization has resulted in accelerated growth in land consumption that threatens to undermine the quality of life in both cities and suburbs. The State of the Cities 2000 outlines the Clinton Administration's policy agenda for America's cities and suburbs. Key components of the program include:
The State of the Cities 2000 is available free from HUD USER. Use the order form. |
