Sort by

Can Trickle-Down Gentrification Actually Work?

David Callahan

True or false? When techies and "creatives" take over a neighborhood or city, the poor and the middle class get screwed.

You'll surely answer true if you've tried to find an affordable apartment lately in Brooklyn or San Francisco. The revival of cities has seemingly spelled the demise of urban living for a great many people who can no longer afford housing -- and instead find themselves pushed out to distant suburbs or less desirable fringe areas. As techies and creatives engineer new opportunities for themselves, everyone else ends up further away from opportunity. And the urban poor who do stick around -- say, in those housing projects in Fort Greene -- don't have the skills to work in the businesses spawned by the hipster elite. They'll be lucky if they can get a job at one of the many new Starbucks.

Or so goes the rap. 

But Michael Mandel argues that the opposite is true. Looking specifically at the effects of the tech industry surge in New York City over the past seven years, Mandel wrote yesterday in the Times:
Surprisingly, over the past couple of years, the city’s minority populations have been among the main beneficiaries of this boom. Since 2010, the number of blacks working in computer and mathematical occupations — the Census Bureau’s term for tech-related jobs — in the city has risen by 19.7 percent, based on a preliminary analysis of new census data.
Over the same stretch, the number of Hispanics in such occupations in New York City has risen by 25.4 percent. By comparison, non-Hispanic whites in computer and mathematical occupations experienced just a 6.4 percent gain since 2010.

What's happening here, Mandel says, is that many more young people of color ("minority" is the wrong word for these folks in a city that is over half non-white) are getting tech degrees and then parlaying those degrees into jobs. Maybe employers once mainly hired nerdy white guys for tech and IT jobs, but the tight labor market in this sector has forced them to look to less traditional candidates -- like grads from New York City College of Technology in downtown Brooklyn, where African-Americans make up the largest share of students.

Speaking of Brooklyn, while it's true that rising housing prices have pushed out a lot of people, the borough's economic revival has brought new jobs to an area of the city that was left destitute decades ago by the decline of manufacturing and shipping. Mandel writes: 

The boom has also produced benefits across all five boroughs: Private-sector jobs in the outlying boroughs rose by 9 percent from mid-2008 to mid-2013, while private-sector jobs in Manhattan are up only 3 percent over the same stretch. This pattern is the reverse of the financial boom years, when Manhattan generated jobs at a much faster pace than the rest of the city.

And while the middle class has been pushed out of brownstone Brooklyn, the housing projects are still there -- not just in Fort Greene, but in Boreum Hill, Red Hook, Williamsburg, and elsewhere, providing thousands of affordable units smack in the middle of New York's most vibrant new area. Those projects have been demonized as places that house a dysfuctional underclass, but actually are far more diverse, home to plenty of young people who want to make something of themselves. 

So maybe tech-led gentrification doesn't have to be a total wipe out for the poor after all. If leaders like Mayor Bill de Blasio can figure out a way to expand affordable housing options, allowing people of more modest means to live in urban cores, the tech boom could be a net plus for cities. Throw in higher wages at low-skilled retail and restaurant establishments -- which unions are pushing hard for now -- and the whole picture could change. That job at KFC on Flatbush Avenue could actually lead to a secure life. 
As a policy challenge, expanding affordable housing seems less daunting than lots of other challenges -- say, like fixing schools or stopping crime. New York City once did a pretty good job on this front through a combination of rent regulations and construction of public housing. Big insurance companies like MetLife played a key role, too, creating Stuyvesant Town and other large middle class complexes. Meanwhile, other countries still do a good job of ensuring affordable housing in cities for the working and middle classes. 
Just maybe the formula for urban equity is not all that complicated: Foster job growth in new industries like tech, ensure access to college so kids can get trained for these jobs, unionize the other low-skilled jobs, and take steps to create much more affordable housing so people of all classes live together in thriving cities.
Doesn't sound like rocket science to me.