“The story I tell is one of a city transformed,” opens Thomas Sugrue in his book The Origins of the Urban Crisis: Race and Inequality in Postwar Detroit. Once America’s fourth-largest city, boasting over 1.8 million residents and a multitude of car manufacturers, steel mills, depots, and parts plants, Sugrue noted that by 1996, Detroit had “lost nearly a million people and hundreds of thousands of jobs. Vast areas of the city … now stand abandoned. Prairie grass and flocks of pheasants have reclaimed what was, only fifty years ago, the most densely populated section of the city.”
Twenty-one years later, America still finds itself locked in a discussion of how to revitalize shrinking cities like Detroit, which lost 25 percent of its population in a single decade. Urban population loss leaves deep scars on cities, from economic decline to worsened infrastructure to an increase in the local crime rate. In the worst cases, such an exodus may cause a “perpetual spiral” of worsened living conditions—spurring further flight from the city. The geographic concentration of urban decline further amplifies these effects, with half of the 20 fastest-shrinking cities located in the so-called Rust Belt.
In the face of this urban decline, policymakers have struggled to maintain basic government services: in Detroit, for example, it took police 58 minutes on average to arrive at a high-priority crime scene. Worse still, cities have tried for decades to stem the outflow of residents. But whether it’s tax cuts or business investment, many methods to mitigate population loss have been largely unsuccessful. Some observers have even deemed the future of these areas hopeless, suggesting that residents should instead “accept that some of these big cities need to die.”
While at first glance the havoc caused by population loss may seem irreversible, America’s declining Rust Belt cities still have the ability to survive and even thrive. A key to their revitalization may be found in another, lesser-known trend: a quiet, but significant influx of college-educated young adults. Various metropolitan areas have enjoyed an increase in college graduates of over 30 percent since 2000 alone. Attracting a college-educated population is crucial for any city hoping to grow, as doing so boosts entrepreneurship, tax revenues, and economic growth.
Expanding the college-educated population becomes even more important if a city is shrinking. As city populations fall, economic consumption and city tax revenues will decrease while the city continues to pay for an infrastructure built for twice its remaining population. And demographic shifts suggest that the Rust Belt’s overall population, along with its working-age population, will continue to shrink in the near future. As a result, simply attracting more residents is not a viable strategy for Rust Belt revitalization; the residents themselves must become a more productive workforce. Even as urban policymakers take other measures to improve their cities, strong investments to attract and maintain an educated population remain crucial in helping urban areas in the Midwest and Appalachia to stem their population loss and economic struggles.
To understand the importance of building and attracting an educated population, it’s crucial to first understand the economic problems facing shrinking Rust Belt cities. In large part, this economic decline takes root in damage to local manufacturing sparked by globalization and improving technology. In Pittsburgh, for example, as the steel industry faced increasing foreign competition in the 1980s, the city’s economy collapsed with it, resulting in an unemployment rate that hit 18.2 percent in 1983. Similarly, the proportion of Cleveland’s jobs in the manufacturing sector dropped from 32 percent in 1975 to 11 percent today. And in Detroit, a place so dependent on the auto industry that it garnered the moniker “Motor City,” automation, high energy costs and increasing production overseas left one of America’s largest cities in the lurch.
As urban populations and job opportunities have fallen, so too have incomes: median household incomes in some of the region’s largest cities have declined since 1970, and often continue to lag behind state and national income growth. Housing prices have also plummeted, to the point where some neighborhoods have become so blighted and depopulated that city governments have demolished and converted them to green spaces. Business growth is down, with a net loss of businesses in the regions home to cities like Pittsburgh and Detroit.
While some analysts have optimistically pointed to a so-called “rust-belt revival” catalyzed by the region’s low real estate costs and new investment, for much of the Midwest and Appalachia, economies continue to underperform in rural and urban areas alike. Furthermore, the types of high-profile stimulus investments that could jump-start their economic growth may prove unfeasible for many regional cities. Not only has population loss hammered many cities’ coffers, but legislatures in states like Ohio and Michigan are increasingly cutting their funding obligations to municipal governments. In Flint, for example, a nationally-known water crisis failed to dissuade the state of Michigan from cutting state funding to the city’s government.
It’s clear that Rust Belt cities are struggling economically, but despite the broader demographic challenges in shrinking cities, college graduates’ staggering economic contributions can help cities weather population decline. Most obviously, if the problem in shrinking cities stems in part from disappointing levels of economic activity, attracting more college graduates strongly boosts consumption in the local economy. For citizens who attain a college education, lifetime earnings often shoot up dramatically compared to those without a degree, allowing them to spend more in the local economy. In fact, a Brookings Institution report estimates that, on average, households with a bachelor’s degree holder spend roughly $13,000 more per year on local goods and services than those with a high school diploma.
College graduates don’t just consume: they also produce. Increasingly, college graduates are demonstrating interest in entrepreneurship, with one survey showing as many as 45 percent of recent graduates hoping to start a business. Furthermore, a college degree tends to boost an entrepreneur’s likelihood of success, in part by helping people to build what The Atlantic’s Robert J. Zimmer calls “the social capital to help them make connections, build networks, and establish life-long relationships.”
Moreover, because residents with a college degree tend to earn more, local governments raise more revenue, with an average bachelor’s degree holder coughing up $44,000 more in local and state taxes over a lifetime than a resident without a college degree. While this won’t make up for the declining cash flow from state funding, the additional revenue could help urban areas provide better services to residents, as well as the tax relief and stimulus needed to generate local economic growth.
And if more college graduates can help revive an area, a city must then consider how best to grow its college-educated population. Pittsburgh offers a textbook example of successfully attracting these college-educated adults: the number of city residents aged twenty-five and older with a college degree skyrocketed by 37.3 percent from 2000 to 2013.
This demographic sea change didn’t occur in a vacuum; rather, it was the result of a series of careful policymaking decisions that came from the city. Firstly, the city invested in providing a top-notch education for its residents, collaborating with Carnegie Mellon and the University of Pittsburgh to transform Pittsburgh from the Steel City of the 1980s into a STEM juggernaut in fields like computing, robotics and biotechnology.
Other cities, too, have seen the benefits, monetary and otherwise, of close partnerships with universities and businesses to produce and maintain a more educated population. In Detroit, Michigan’s University Research Corridor—comprised of the University of Michigan, Michigan State University, and Wayne State University—generated an estimated $958 million in economic activity in 2015 alone. Wayne State University’s police department routinely patrols the streets of Midtown Detroit, helping to cut crime in the area, helping the Detroit Police Department to cut its response times by nearly 43 minutes. The University of Wisconsin-Milwaukee touts the 59,000 service hours its students completed in the 2015-2016 school year. And technical and two-year degree institutions have shown equal potential to contribute to a metropolis’s growth, with community colleges across Ohio contributing $6.5 billion annually to the state’s economy.
But cities must be on their toes when keeping their college-educated graduates, who often move on after receiving their degree. In Milwaukee, for example, students often leave after they graduate. Cities like Philadelphia offer incentives for students to stay after earning their degree, preventing the kind of brain drain that many feared. Pittsburgh has shined in retaining college graduates: even as it upped its investment in its institutions of higher education, the city coupled its attention to local colleges with a strategy that German urban affairs researchers Thorsten Wiechmann and Karina Pallagst term “public/private/neighbourhood partnerships” to attract jobs in “high-tech industries, education, health care, culture and tourism.” By ensuring the right economic climate existed to tempt graduates to settle down in the Burgh, the city was able to grow its college-educated population substantially.
That focus on the city’s cultural attractions may have been just as important as its attempt to draw high-skilled jobs: while some young people have flocked to the city for its jobs, many stay because of its pro-sports teams, museums, and outdoor recreational opportunities. Despite their seemingly aesthetic appeal, these cultural improvements have led to tangible results. A recent article from the Pittsburgh Post-Gazette wrote: “From 2010 to 2015, worker productivity shot up 10 percent, average annual wages increased 9 percent and the overall standard of living rose 13 percent in the Pittsburgh region.”
Cities across the Rust Belt are following Pittsburgh’s example. They’ve discovered that to bring in college graduates, they need to appeal to millennials in general. That means providing amenities like affordable housing and public spaces, as well as businesses like restaurants, fitness centers and movie theaters that are tailored towards younger residents. Indianapolis, for example, has appealed to young people in part because of its “walking and biking paths, its proximity to the minor league baseball stadium, and a growing night scene with mom and pop restaurants.” In Grand Rapids, Michigan, the state and city collaborated to invest in new lofts, gardens, and farmer’s markets to attract young people.
But this generally optimistic outlook for Rust Belt cities comes with a few caveats. Firstly, cities must be careful that their efforts to develop and attract a more educated population do not stigmatize less-educated residents. Despite the large movement of college-educated adults to many Rust Belt cities, they are not close to being the majority: even in Pittsburgh, just. 38.3 percent of city residents age twenty-five and up have a college degree. If policymakers want to protect less educated residents from marginalization, they will need to grow and leverage an educated population to benefit the city as a whole, not to grow the educated population as an end in itself.
Relatedly, cities must be aware that even as their college-educated population may drive wages and economic growth in general, that growth will be uneven, and may even have harmful effects on some residents. As Sugrue wrote, “It will take more than a few thousand hipsters or white urban professionals or avid sports fans to revitalize a sprawling, mostly African American, working-class city.” Urban issues are complex, and no one policy is a panacea. Even as college graduates spur economic growth, their migrations have caused gentrification across Rust Belt cities. Neighborhoods in places like Minneapolis have seen astronomical increases in rent that have forced some residents to choose between food and housing, and cities must take measures to ensure that individual neighborhoods aren’t being left behind in the economic growth.
But rather than assuming that college-educated residents will always have a negative impact on their less privileged neighbors, cities can harness the additional tax revenue and economic growth generated by college graduates to help improve the lives of other residents. This means programs like targeted, geographic tax relief, through programs like Detroit’s Neighborhood Enterprise Zone Tax Relief Program, which provides struggling neighborhoods with individualized property tax cuts. It also means generously funding investments in affordable housing—and locating that housing in desirable neighborhoods to combat gentrification and segregation. Revenue from upper-class individuals and businesses can also fund increased investments in such vital services as public education, as a proposed new $400 to $600 million tax on downtown businesses and wealthy residents to fund the Chicago Public Schools demonstrates.
Lastly, urban policymakers need to realize that, fundamentally, a shrinking population is still a less empowered one, and efforts must be made to attract additional residents however possible if urban areas wish to truly prosper. This means adopting policies that signal support for immigration and investing in quality K-12 education so that families can grow and remain in the Rust Belt’s urban areas.
Regardless, area policymakers must recognize the opportunity that comes with attracting a more educated college population—an opportunity that could help cities some have said “need to die” not only survive, but thrive as well.
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