Left Behind: Missing from the Labor Market in New York State

A reader of this blog recently wrote, “We know that labor force participation rates across the country have declined noticeably for a number of years, and many economists have warned of the troubling implications of this.  Such rates across Upstate NY have declined as well, and in most cases are significantly below the national average – not an encouraging sign.  In the North Country and the Mohawk Valley, they are not much above 50%, and in some other Upstate regions just a couple of percentage points higher. Clearly some of this indeed is because people have not been able to find jobs, and thus have left the labor force.  I don’t think a low unemployment rate necessarily indicates that “Upstate’s problem is not that its residents cannot find jobs.”

Low rates of labor market participation might indeed show that people are dropping out of the job market because of limited opportunities.  But, other factors are at work as well, including the aging of the population.  This post reviews labor market participation data in New York’s counties to understand changes over time and how low participation counties differ from those with higher participation rates.

A recent Brookings Institution study, “What we Know and Don’t Know about Declining Labor Force Participation: A Review” points out that: “This steady decline in prime-age male participation rates and recent stagnation of prime-age female rates has adverse implications for national economic growth and individual well-being. Workers between the ages of 25 and 54 tend to be at their most productive, so these trends affect economic growth as well as individual income. Further, as discussed below, lower work rates might be contributing to the decline in marriage and to poorer health and psychological well-being, possibly leading to an increase in premature deaths among certain populations.”

A significant part of the decline is explained by the aging of the population, as older workers move into retirement. John Robertson and Ellyn Terry of the Atlanta Federal Reserve Bank report that “In 2007, about one in five Americans were over 60 years old. In 2015, almost one in four were over 60. Moreover, this demographic force will continue to suppress the overall LFPR as the share of older Americans increases further in coming years.

But, labor force participation has declined overall.  The Bureau of Labor Statistics reported in 2016 that, “From 2000 to 2015, most of the major demographic groups saw a decrease in labor force participation. Teenagers experienced the largest drop in participation, which coincided with a rise in their school enrollment rate. Young adults 20 to 24 years also showed a decline in labor force participation, but the decrease was not as steep as that for teenagers. The labor force participation rate of women 25 to 54 years also fell, with the decrease more pronounced for women who did not attend college. The labor force participation rate of men 25 to 54 years continued its long-term decline. As in the past, the decrease in participation among men with less education was greater than that of men with more education. However, labor force participation rates of men and women 55 years and older rose from 2000 to 2009 and subsequently leveled off.”

The causes of the decrease in labor force participation for prime age people include both the demand for workers and the supply of labor.  On the demand side, technology and trade have reduced the demand for low skilled manufacturing workers.  The disparity in demand for workers at low and high skill levels has increased, because technology has led to greater demand for workers with technical and managerial skills.  On the supply side, the Brookings Institution study points out that “the problems include not only a lack of skills but high reservation wages [the wage levels at which people are willing to accept jobs], poor health, and the availability of disability insurance or other forms of unearned income.


Labor Force Participation in New York State

In this post, I look at differences in the labor force participation level between counties in New York State.  Because the economic performance of the New York City Metropolitan area has been stronger than upstate New York since 2000, participation in the two regions is examined separately, where relevant.

This analysis is at the county level, and does not show differences in participation based on levels of economic disadvantage below the county level, particularly in urban centers where participation may also be low.

The data shows that while changes in labor market participation from 2005 to 2015 in the New York Metropolitan area, and in larger upstate metropolitan areas did not differ much from the nation as a whole, smaller metropolitan areas and rural upstate had greater declines than the nation.  Comparing county performance in 2015, large differences were found in the educational attainment of residents of better and worse performing counties.  The percentage of college graduates in the populations of the 15 counties in New York State was more than double that found in the 15 counties with the lowest level of participation.  The behavior of residents within particular socio-economic groups in counties with high and low labor market participation varied as well.  Disproportionately lower percentages of people who did not complete high school, residents who were black or Hispanic or male, and residents who were 25 and 34 years old and 55 and 64 participated in the labor market in counties where labor market participation was low.

Data is from the Census Bureau’s American Community Survey.  The Census Bureau data differs from the Bureau of Labor Statistics data referenced at the beginning of this post in its methodology and sample selection.   The differences in methodology are  discussed here.

In this post, I use two different data samples.   Beginning in 2005, county level labor force participation data is available from the Census Bureau’s American Community Survey.  The sample used for the section titled “Change over Time” is from single year samples of one percent of the United States population.  The single year samples are too small to permit an analysis of data for small population units.  Consequently, only 37 of 62 counties in New York State are included.  Because the sample is relatively small, estimates of smaller county characteristics can have relatively large errors – as much as 2.5% for labor force participation for the entire population, and as much as 5% for some groups within the overall population.

In the section “Comparison of Labor Force Participation at the County Level in 2015” I use a five-year sample of the population that includes 5% of the United States population.  Because the sample is larger, it includes all New York counties, and has less sampling error.  Smaller county estimates are likely to be within 1.3% of the true value.  Estimates of groups within the overall population should be within 3% of the true value.  But, because the data is an average of five-year data, it lags trends, since the midpoint for the time period covered for the 2015 five-year data, which includes surveys from 2011 to 2015, is 2013.

Because differences in labor force participation between counties are relatively small, it is important to recognize that their relative performance can vary from year to year because of sampling error.  For example, Schenectady County’s labor participation rate was reported as 63.7% in 2014, 61.7% in 2015, and 64.7% in 2016.  That kind of variation could reflect sample variation around the true participation level.


Change over Time

The tables showing change over time between 2005 and 1026 are based on the American Community Survey data for a single year.  Counties in the New York Metropolitan areas saw relatively wide variations in the change in the level of labor force participation between 2005 and 2016.  For example, Kings County (Bronx) saw an increase from 59.7% to 63.9% over the period, while Dutchess County saw a decrease of 6.2% from 68.4% to 62.2%.  Two thirds of the counties in the metropolitan area did better than the national average, based on the American Community Survey sample data.
Three quarters – nine of twelve counties in the New York metropolitan area had participation rates that were higher than the national average in 2016, compared with seven of twelve in 2005.

Census Bureau’s American Community Survey 2016 one year data includes 26 of 50 counties outside the New York Metropolitan area.

In upstate New York, larger metropolitan counties, like Monroe, Schenectady, Saratoga, Albany, Niagara and Erie County had smaller percentage labor force participation losses between 2005 and 2016 than did the nation .  Others, like Rensselaer County, Onondaga County and Cayuga County were near enough to the national average to be within the margin of error of the national estimate.

Many small upstate counties had larger declines than the nation as a whole.  Decreases in Broome County (5.8%), Ulster County (5.9%), St. Lawrence County (6.1%), Oswego County (6.2%), Chautauqua County (6.5%), Clinton County (6.7%), Ontario County (8.3%) and Sullivan County (9.9%) were all more than twice as great as the national average. It is also important to note that all of these counties had participation rates in 2015 that were significantly lower than the national average.  Chautauqua County was lowest at 55%. Seven upstate metropolitan areas had participation rates that were greater than the national average, compared with 18 that were below it.  In 2005, eight upstate counties had participation rates that were higher than the nation as a whole, and 17 were below.


Comparison of Labor Force Participation at the County Level

The American Community Survey five-year sample from 2011 to 2o15 used in the following section has a margin of error of approximately plus or minus 1.3% for counties, so differences of that size between counties should not be viewed as significant.  Because this data has a different time period (2011 to 2015) and sample size, the numbers differ from the discussion of change above.

Nationally, 63.7% of people 16 years old or older were in the labor force in 2015.  In New York State, participation in 2015 ranged from 67.6% in Putnam County, where 67.6% were in the labor force, to 50.8% in Hamilton County. Overall, participation levels were higher in the New York metropolitan area (65.3%) than in upstate counties (60.0%).

Two of five counties in New York City (New York, and Queens) had participation rates in 2015 that were above the national average, while three had rates that were below (Kings, Bronx and Richmond). Suburban counties in the New York City Metropolitan Area were above the national average.

Upstate, larger metropolitan counties, including counties around Albany-Schenectady-Troy, Rochester, Syracuse, and Buffalo-Niagara Falls, had labor participation rates that were higher than or within their margin of error compared with the national average.  Smaller urban areas upstate, like Utica-Rome (59.4%), Binghamton (58.7%), Jamestown (58.1%) and Elmira-Corning (56.9%) and rural counties generally had participation rates that were below the national average


Factors Related to Labor Force Participation Rates

Census data includes a number of factors that show significant relationships with levels of labor force participation.  Among the more important are:

Educational Level

At the individual level, education is a significant predictor of labor force participation.  People with a bachelor’s degree or higher are  27% more likely to be employed or seeking employment than those with have not graduated from high school.

  • Education: Population Characteristics

In 2015, there were large differences in educational attainment in the 15 counties with the highest labor market participation and the 15 with the lowest participation.  Counties with high levels of participation had 15% fewer people whose highest level of educational attainment was high school graduation than did counties with low levels of participation. Counties with high levels of participation in 2015 had 24% more people who had attained a Bachelor’s degree or higher than did the 15 counties with the lowest participation levels.

  • Labor Market Participation at Each Level of Educational Attainment

Comparing the top quarter of counties ranked by labor market participation with the bottom quarter, the largest divide in participation is for people with less than a high school degree.  On average, only 41% of those with less than a high school diploma were labor market participants in 2015 in the lowest quarter of counties ranked by participation.  In  the quarter of counties with the highest participation levels, 62% of those with less than a high school diploma participate.  At the opposite end of the educational spectrum, the difference in labor market participation levels for those with a Bachelor’s degree or more was only 3.3% – 87.1% vs. 83.3%.

 

Age

Like education, age is related to labor market participation at the individual level.  Young (16-19 years old)and old (60+) people participate at lower rates than workers of other ages.  As a result, it is not surprising that counties whose populations have higher percentages of older people have lower labor participation rates than counties with younger populations.

  • Age: Population Characteristics

This section compares labor market participation levels for two age groups:  younger workers aged 25-44 are in age groups that show the highest levels of labor market participation overall, and older people, aged 55+ who are beginning to leave the labor market.  The differences in the size of the older compared to the younger age group in the top 15 and bottom 15 counties are relatively small – in the top 15 counties, people between 25 and 44 make up 5% more of the total population than in the bottom 15 counties.  Older people, aged 55 or more, are 4% more of the total population in the lowest 15 counties than in the highest 15 counties.

  • Labor Market Participation at Each Age Range

Comparing labor force participation with age for the highest quarter of counties vs. the lowest quarter shows that participation levels differ most for those between 25 and 34 and for those who are 55 to 64 – in those cases the difference between participation levels is more than 10%.

Gender

  • Labor Market Participation:  Men vs. Women

Statewide, 81.4% of men and 72.8% of women were in the labor force in 2015.  Although difference between the labor participation rate of women living in the top quarter of counties ranked by labor participation compared with the lowest quarter of counties was 4.9%, the difference in participation rates for men in high versus low participation rates was much larger – 13.9%.

Race

For this analysis, the state has been separated into the New York City Metropolitan area and the rest of the state, because of significant differences in the levels of black/Afro-American and hispanic labor participation.  Because the number of black and Hispanic residents of low participation counties New York City Metropolitan Area is quite small, the comparisons presented here are between the top half of counties by labor market participation and the bottom half.

  • Race and Ethnicity: Population Characteristics

In the New York City Metropolitan area, the top half of counties ranked by labor market participation had populations in 2015 aged 16 or over that were 52% white, compared with 34% white for the lower participation counties.  High participation counties had 8% less black/Afro-American residents and 4.5% less Hispanic/Latino residents.

Upstate, the top half of counties ranked by labor market participation in 2015 had populations in 2015 that were 82% white, compared with 87% white in lower participation counties.  Blacks/African-Americans comprised 4.4% more of the population aged 16 or more in higher participation counties than in lower participation counties.

  • Labor Market Participation: Race and Ethnicity

In the New York City metropolitan area, participation rates for blacks/Afro-Americans, Hispanics and whites were similar in the low and high participation counties in 2015.  The difference in labor force participation in high and low participation counties was only 3.1%.  For black/Afro-American, participation is 63% in both high and low participation counties.  Hispanic and white residents participated more in the labor market in high participation counties by 3% and 4% respectively.

In upstate counties, the picture differs.  White labor market participation in high participation counties was 5.3% higher in 2015 than in low participation counties.  Hispanic labor market participation was 14% higher in high participation counties than in low participation counties.  For black/African-American residents, the difference was 25% in 2015, with participation averaging only 34% in low participation counties, compared with 59% in high participation counties.


Conclusions:

In the New York Metropolitan area, county populations aged 16 or over are large – averaging 650,000 for high participation counties, and 1.1 million for lower participation counties.  Additionally, the range of labor participation levels in the New York Metropolitan area was relatively small in 2015, and participation levels were higher overall than upstate.  In fact, the participation rate for the lowest county in the New York Metropolitan area – Staten Island – was within 1/10th of one percent of the average for upstate counties.

The range for upstate counties was much larger.  Saratoga County’s participation rate of 67.6% was the second highest in the state, while Hamilton County’s was 50.8%, almost 9% lower than the lowest county in the New York Metropolitan area.  In Upstate New York, labor force participation is higher in large metropolitan areas than in small ones.  This finding suggests that areas with smaller populations do not provide the opportunities for employment that are offered by larger ones.

Participation Differences Resulting from Differences in County Population Characteristics

Two characteristics showed consistent differences between counties with low and high participation levels – education and age.  Of the two, educational attainment showed much larger variations between counties with high participation levels and those with low levels of labor market participation.  The difference in the percentage of residents with college degrees or more is particularly striking:  45.4% in the 15 counties with the highest levels of labor market participation, and 21% in the 15 counties with the lowest levels.  In contrast, 35.5% of residents in counties with low participation levels had ended their education at high school graduation, while 21% of those in counties with high levels of participation had only graduated high school, a difference of 14%.

A portion of the variation in the educational attainment of residents between counties is likely to be a result of the differing levels of educational levels of educational attainment of young adults who were raised in those counties.  Another part stems from migration patterns of young people seeking and finding first jobs inside and outside their home counties.  Determining the relative contribution of each factor is beyond the scope of this research.

It was expected from previous research that counties having a higher proportion of older residents would have lower participation levels than those with younger residents.  But, the differences found in counties in New York State were less significant than those for educational attainment.  The percentage of residents aged 25-44 was about 5% higher in high participation counties than in low counties, while the percentage of those 55 years old or older was 4% less.

Differences in Participation within Groups in High and Low Participation Counties

There were also significant variations in labor market participation within groups in high and low participation counties.  Among the more notable were:

  • Much lower labor market participation by people who did not complete high school in the 15 lowest participation counties, compared with the highest participation counties – 41% vs. 62%.
  • Significantly lower participation by workers aged 25 to 34 and 60-74 in low participation counties: differences exceeded 10% between the bottom and top quarter of counties sorted by labor participation.
  • Much lower participation by males in the 15 lowest participation counties, compared to the 15 highest (14%) than by females (5%).
  • Very large differences in participation levels for black/Afro-American residents and Hispanic/Latino residents between upstate counties with low and high labor participation levels – 25% for black/Afro-American residents and 14% for hispanic residents.

Differences in participation within groups between counties that have low and high labor participation levels at least partially reflect the hypothesis that people have been unable to find jobs and have left the labor force.  But beyond that, the data shows that some groups are much more likely than others to be absent from the labor force in low participation counties.  These include people with little education, men, young and old workers, and blacks and Hispanics.   The low levels of participation of these groups in low participation counties probably reflect reinforcing factors, like lower average levels of education among minority group members, the decline of manufacturing industries that employed low skilled men, and low levels of demand for workers without college educations in places where there are relatively few jobs available.

These differences are not present in the New York City metropolitan area, where most counties have relatively high labor market participation levels, or in larger upstate metropolitan areas, like Buffalo, Rochester, Syracuse and Albany, but they are significant is smaller urban areas like Utica, Binghamton and Elmira, and in rural areas of New York State.

To the extent that New York’s development policies can be based on need, one focus should be on upstate’s small urban areas and rural communities.  If smaller counties are to see more labor market participation by their residents, the state must help them address the barriers that have discouraged participation by less educated people, men, blacks/Afro-Americans and Latinos, and find ways to generate jobs that retain college graduates.  At the same time, policy makers concerned about the well-being of New York residents must recognize that some policies that would help residents of low participation counties access jobs could increase out-migration to locations with more employment opportunities.  The ability of low participation counties in small metropolitan areas and rural locations to create the resources needed to diversify their economies to include occupations that match the qualifications of residents are likely to be limited, because of the significant advantages offered by locations that have larger labor pools.




Racial Divisions in Upstate Metropolitan Neighborhoods

In my last posting I described income differences in 800 upstate metropolitan neighborhoods in Albany, Erie, Monroe, Oneida, Onondaga, Rensselaer and Schenectady Counties.  The data comes from the United States Census Bureau which divides the nation into census tracts, the most detailed level publically tabulated. Overall, there are 73,000 census tracts nationally, averaging 4,200 residents each.

While there are significant differences in incomes, unemployment and poverty among upstate neighborhoods, the differences in racial patterns, particularly between people identifying as black or African-American and those identifying as white are much stronger, and the racial differences are strongly related to neighborhood economic conditions.

Racial Divisions – Two Neighborhood Types

Census Tracts with High Concentrations of Black Residents

Upstate Metropolitan Census Tracts – 2014
Sorted by Percentage of Black/African-American Residents
High Concentration Average Concentration Low Concentration
  30% of of all Black Residents 40% of all Black Residents 30% of all Black Residents
%Black 83.4% 38.6% 4.4%
%Hispanic 5.0% 16.7% 3.8%
%White 8.6% 36.2% 86.4%
Black Residents 105203 143812 109430
All Residents 126153 373030 2471015
Low Income 64.0% 58.6% 29.5%
Medium Income 31.4% 34.8% 47.7%
High Income 4.6% 6.6% 22.8%
Mean Household Income $37,238 $44,171 $76,175
% Unemployment 19.8% 14.1% 6.7%
% Poverty 34.0% 32.4% 6.8%

More than eight of every ten residents of neighborhoods with high concentrations of black residents identify as black or African-American, even though only 12% of all residents of upstate metropolitan census tracts were black.  Residents in typical neighborhoods with high concentrations of black residents had very few residents identified as white, not Hispanic – only eight in one hundred.  About five percent of residents with high concentrations of black residents identify as Hispanic, about the same percentage as upstate urban neighborhoods, overall.

When average concentration neighborhoods are added to the picture, 70% of residents live in neighborhoods that average 50% black or African-American.  These neighborhoods have concentrations of black residents that are more than four times the average for all upstate neighborhoods.  When combined with those who identify as Hispanics, people who live in neighborhoods that have average concentrations of black/African-American residents are more than 60% minority residents.

Note that the income, unemployment and poverty levels of neighborhoods that had average levels of black residents were only slightly better than those of neighborhoods with high levels.  For neighborhoods with high and average concentrations of black residents, mean household incomes in 2014 were only slightly higher ($40,176) than those for residents of neighborhoods with high concentrations of black residents ($37,238).

blacklo

In neighborhoods with high concentrations of black residents, 64% of households had low incomes – almost as high a percentage as was found in neighborhoods with high concentrations of low income residents.  About three in ten residents of these neighborhoods had middle incomes, while about 5% had high incomes.

Typical residents of neighborhoods with high concentrations of black residents, had incomes of  $37,200 in 2014, only slightly higher than the average income in neighborhoods with high concentrations of low income residents.  Similarly, the concentration of poverty in neighborhoods with high concentrations of black residents averaged 37%, like that of low income neighborhoods, which averaged 37%.

Unemployment among residents of neighborhoods with high concentrations of black residents was nearly 20% in 2014, the highest of any of the groups in this analysis.

Census Tracts with High Percentages of Hispanic Residents

Upstate Metropolitan Census Tracts – 2014
Sorted by Percentage of Hispanic Residents
  High Concentration Average Concentration Low Concentration
  30% of all Hispanic Residents 40% of all Hispanic Residents 30% of all Hispanic Residents
%Hispanic 29.8% 9.2% 2.4%
%Black 35.8% 20.8% 7.3%
%White 27.5% 62.3% 85.5%
Hispanic Residents  48,205  65,181  50,189
All Residents  161,994  704,899  2,103,305
Low Income 65.5% 46.4% 28.4%
Medium Income 30.2% 41.8% 47.7%
High Income 4.3% 11.8% 23.9%
Mean Household Income $39,943 $52,818 $78,526
% Unemployment 18.0% 10.1% 6.6%
% Poverty 38.4% 19.7% 6.2%

Only 5.5% of residents of upstate metropolitan census tracts are of Hispanic descent.  So, even in those places where there are relatively high Hispanic concentrations, they make up only a minority of residents.  In the neighborhoods with the highest concentrations of Hispanic residents, on average 30% of residents were Hispanic, compared with 36% Black/African-American and 27.5% White (not Hispanic).

hisplo

Like people who identify as Black/African American, Hispanic households most often have low incomes (66%).  About 30% of Hispanic households in upstate urban areas are middle income, while 4% are high income households.  When neighborhoods including high and average concentrations of Hispanics are combined – 70% of all Hispanics, their average income reached $49,642, lower than the average income of those who identify is white, not Hispanic, but higher than that of people who identify as black or African American (40,176).

Neighborhoods with high concentrations of Hispanics had high levels of unemployment (18%).  The concentration of poverty in neighborhoods with high concentrations of Hispanic residents (38.4%) was slightly higher than that of low income neighborhoods and those with high concentrations of black/African-American residents.

Census Tracts with High Concentrations of White Residents

Upstate Metropolitan Census Tracts – 2014
Sorted by Percentage of White Residents
High Concentration Medium Concentration Low Concentration
  30% of all White Residents 40% of all White Residents 30% of all White Residents
%White 96.2% 89.8% 55.8%
%Black 0.7% 2.9% 25.6%
%Hispanic 1.5% 3.1% 9.6%
White Residents  662,506  922,262  707,720
All Residents  688,680  1,014,263  1,267,255
Low Income 24.7% 26.2% 46.7%
Medium Income 49.5% 48.9% 40.3%
High Income 25.8% 24.9% 13.0%
Mean Household Income $80,921 $80,710 $55,793
% Unemployment 6.3% 5.9% 10.6%
% Poverty 4.4% 4.7% 20.5%

Neighborhoods with high concentrations of white residents look very different from those with high concentrations of black or Hispanic residents, and from the average of all residents.  Thirty percent of all white (non-Hispanic) residents live in neighborhoods that average 96% white, with less than one percent of black residents, and 1.5% of Hispanic residents.  Overall, 77% of residents of upstate metropolitan areas are white, 12% are black and 5.5% Hispanic.

Whitelo

They also differ significantly in their economic characteristics.  About 75% of residents of neighborhoods with high concentrations of white residents have middle or high incomes.  For black and Hispanic residents, the corresponding percentage is 35%.  The median household income for neighborhoods with 70% of all white residents of upstate urban neighborhoods is more than $80,000, compared with $40,176 for neighborhoods with 70% of all black residents, and 49,642 for neighborhoods with 70% of Hispanic residents.

The average unemployment percentage in 2014 in neighborhoods with high concentrations of white residents was 6.3%, compared with 20% in black neighborhoods, and 18% in neighborhoods with high concentrations of Hispanic residents.  Very few residents of neighborhoods with high concentrations of white residents lived in poverty in 2014 – 4%.  For black neighborhoods, the percentage was 34% and for neighborhoods with high concentrations of Hispanics, the percentage was 38%.

Concentrations of Residents by Neighborhood Types

Chart 1.

black hispanic white 

Chart one shows that blacks and Hispanics are particularly overrepresented in the upstate metropolitan neighborhoods where they lived in 2014.  65% of blacks lived in neighborhoods with more than twice the overall percentage of blacks in upstate metropolitan counties.  Forty percent of blacks live in neighborhoods with more than four times their overall percentage.  Forty percent of Hispanics live in neighborhoods where they are more than twice their overall percentage in upstate metropolitan counties.

Chart 2

ratio of races

 

Chart two shows the concentration of the group populations in each census tract, sorted by the concentration of group population.  It shows that black and Hispanic populations are far more concentrated than low income, high income and white populations. While most blacks and many hispanics live in neighborhoods with more than twice their overall concentration, almost all low and high income households live in neighborhoods that are less than twice as concentrated as the overall low and high income households in upstate metropolitan counties.

Implications 

In earlier posts, I pointed out disparities in poverty and income between upstate cities and their suburbs, and between white, black and Hispanic residents.  This research extends the analysis to the neighborhood level, and shows that residents with low incomes, black and Hispanic residents are separated by neighborhood from a substantial majority of white residents.  Most white residents live in neighborhoods that have fewer than 5% black and Hispanic residents.  In contrast, 70% of all black residents live in neighborhoods that have more than 60% minority residents, despite the fact that blacks make up 12% of the population of upstate urban neighborhoods.

Equally important, the economic conditions of neighborhoods with high concentrations of black and Hispanic residents closely resemble those of low income neighborhoods.  Black and Hispanic neighborhoods have percentages of low income residents, unemployment levels, and percentages of households in poverty that are very similar to poor upstate urban neighborhoods.  The next post will provide some additional documentation of the economic differences between census tracts with high concentrations of minority group members and those which are primarily white.

The fact that neighborhoods with high concentrations of black/African-American residents are more separated from neighborhoods with high concentrations of white residents than predominantly low income neighborhoods are separated from high income neighborhoods suggests the continuing need to address the racial separation of upstate residents as well as the prevalence of low income neighborhoods if upstate is to remove the barriers that separate its residents.




Income Divisions in Upstate Metropolitan Neighborhoods

In earlier posts, I wrote about income and racial separation between the residents of upstate cities and suburbs.  The data showed that residents of upstate cities saw sharp increases in poverty levels between 2000 and 2013, while city populations became increasingly diverse, primarily because of the loss of white residents.  The data also showed that minority group members living in cities had median incomes that were less than half of those of white residents living in suburban areas.

Income and racial residential patterns can be viewed through a different lens – one which focusses on the differences between residents of neighborhoods, not cities and suburbs.  While my earlier study examined differences between residents of seven upstate cities (Albany, Buffalo, Rochester, Schenectady, Syracuse, Troy and Utica, and their suburbs, this study reviews the differences in economic characteristics of residents living in approximately 800 neighborhoods within the counties where the upstate cities are located.  The data comes from the United States Census Bureau which divides the nation into census tracts, the most detailed level publically tabulated. Overall, there are 73,000 census tracts nationally, averaging 4,200 residents each.

The data shows that while there are significant differences in concentrations of incomes, unemployment and poverty among upstate urban neighborhoods, but that income differences are not strong enough to characterize most of these neighborhoods as truly segregated by income.

Income Divisions – Neighborhood Types

Low Income Census Tracts

Upstate Metropolitan Census Tracts – 2014
Sorted by Percentage of Low Income Households
High Concentration Census Tracts Average Concentration Census Tracts Low Concentration Census Tracts
  30% of all Low Income Households 40% of all Low Income Households 30% of all Low Income Households
 
Low Income Households 66.4% 39.9% 20.9%
Medium Income Households 29.1% 47.2% 49.3%
High Income Households 4.5% 12.9% 29.8%
Low Income Households  123,900  166,461  125,022
Total Households  185,296  417,704  598,295
% Black Residents 40.8% 12.1% 3.0%
%Hispanic Residents 14.3% 5.6% 2.7%
%White White Residents 35.8% 76.4% 90.0%
Mean Household Income $34,938 $57,855 $89,876
% Unemployment 16.9% 8.2% 5.5%
% Poverty 37.2% 11.7% 3.7%

This section looks at low income households in neighborhoods (census tracts) that had median neighborhood incomes that were less than 67% of the national household median ($53,000 in 2014).  The average household income in these neighborhoods was  $34,398 – less than twice the poverty level for a family of three.

Neighborhoods with high concentrations of low income people have higher percentages of residents who identify as black/African American than White (not Hispanic) – 41% vs. 36%.   Overall, 77% of residents of upstate metropolitan neighborhoods were white in 2014, and 12% black. Blacks are more than three times as likely to live in neighborhoods with high concentrations of low income residents as their overall population, while whites are half as likely to live in poor neighborhoods as their population averages in upstate urban counties.

Residents of neighborhoods with high concentrations of low income residents had much greater chances (17%) in 2014 of being unemployed than the average (5.5%) for all members of the workforce in upstate metropolitan census tracts.

Finally, the likelihood that residents of neighborhoods with high concentrations with low incomes lived in poverty (37%) was much higher than it was for all upstate metropolitan residents (14%).

Chart 1.

low med hi income

Chart 1 shows the distribution of low income households compared with middle and high income households.  The chart shows that half of low income households live in neighborhoods where low income residents constitute 40% or more of all residents.   Forty percent of low income residents live in neighborhoods where they are a majority of all households.

However, most low income households are located in neighborhoods where there are significant numbers of middle and high income households.  Only about 15% of low income households are located in census tracts where middle income households are less than 30% of the total.

High Income Census Tracts

Upstate Metropolitan Census Tracts – 2014
Sorted by Percentage of High Income Residents
High Concentration Census Tracts Average Concentration Census Tracts Low Concentration Ceusus Tracts
  30% of  all High Income Households 40% of all High Income Households  30% of High Income Households
 
High Income Households 43.4% 27.5% 10.6%
Medium Income Households 42.1% 48.9% 44.4%
Low Income Households 14.5% 23.6% 45.0%
High Income Households 71890 96128 72361
All Households 165451 349901 685943
%Black 2.3% 3.2% 19.3%
%Hispanic 2.2% 2.9% 7,8%
%White 90.1% 89.7% 66.5%
Mean Household Income $117,693 $83,309 $52,016
% Unemployment 4.7% 5.6% 10.1%
% Poverty 2.4% 4.6% 17.3%

Residents of typical neighborhoods with high concentrations of high income households (households with incomes of more than twice the median), would most likely live in a neighborhood with almost as many middle income households as high income households (43% high income vs. 42% middle income).  Also, almost 15% of the households in these neighborhoods have low incomes (less than 67% of the median income).  So, in upstate New York, households with high incomes are less separated from other households than those who live in neighborhoods with high concentrations of low income households.

Ninety percent of the residents of a typical upstate metropolitan neighborhood with a high concentration of high income households are white, compared with 77% of all upstate metropolitan neighborhoods.  These neighborhoods have very few blacks and Hispanics – each group has only 2% of households in neighborhoods with concentrations of high income residents.

Unemployment and poverty in neighborhoods with high concentrations of high income residents were very low – about 5% of the people in the labor force were unemployed in 2014, while 2.4% lived in poverty.

Chart 2.

high income pic 2

About 90% of high income households are in neighborhoods with more middle class households than high income households.  About 40% of high income households are in census tracts with more low income households than high income households, so there is little segregation of high income households from others, overall.

Families Living in Poverty

Upstate Metropolitan Census Tracts – 2014
Sorted by Percentage of Families in Poverty
High Concentration Census Tracts Average Concentration Census Tracts Low Concentration Census Tracts
  30% of all Residents 40% of all Residents 30% of all Residents
  % in Poverty % in Poverty % in Poverty
% Families in Poverty 47.1% 22.4% 4.2%
Low Income Households 69.8% 50.7% 25.7%
Medium Income Households 26.1% 40.9% 25.4%
High Income Households 4.1% 8.4% 48.9%
%White 28,1% 57.2% 88.7%
%Black 43.4% 26.4% 3.9%
%Hispanic 17.7% 8.9% 3.0%
Families in Poverty  23,564  30,812  22,657
All Residents  50,021  137,252  539,318
Mean Household Income $31,869 $47,385 $81,463
% Unemployment 19.2% 11.5% 5.8%

In neighborhoods with high concentrations of families in poverty, about half the families lived in poverty in 2014.  Given that about 11% of all families of upstate counties lived in poverty, these poor residents are highly concentrated.  But, 70% of all families in poverty lived in neighborhoods where 75% or more of the families did not live in poverty.

Neighborhoods with high concentrations of poverty had high concentrations of low income families – 70%.  Black/African-American families were also overrepresented in census tracts with high concentrations of families living in poverty, with 43.4% of families, compared with 12% for the counties overall. Hispanic families were 17.7% of those in neighborhoods with high poverty concentrations, compared with 5.5% overall.  Not surprisingly, unemployment was also high in these neighborhoods, at 19%.

Chart 3.poverty familiesChart 3 shows a strong relationship between the percentage of families in poverty and the percent of low income households.

Upstate Urban Neighborhoods Compared to the Nation

A 2012 study by the Paul Taylor and Richard Fry of the Pew Research Center, “The Rise of Residential Segregation by Income”[1] examined changes in patterns of residence by income  in 942 metropolitan and micropolitan areas between 1980 and 2010 at the census tract level.  The report found that over that period of time, there was a significant increase in residential income segregation, with particularly large increases in the percentage of upper income families living in upper income census tracts.

The Pew study found that in 2010, 28% of lower income households lived in majority low income census tracts.  In 1980, 23% lived in low income census tracts, and 25% lived in them in 2000.   Eighteen percent of high income families lived in majority upper income census tracts  compared with 9% in 1980 and 16% in 2000.[3]

In upstate metropolitan counties 38% of low income residents lived in majority low income census tracts, compared with 37% in 2000.  In 2014, 6% of high income residents lived in majority upper income census tracts, compared with 7% in 2000.  In all, there was relatively little change in the percentage of low and high income residents living in majority same income census tracts between 2000 and 2014. Neighborhoods in upstate metropolitan areas did not see the increase in the separation of poor and wealthy residents that was found by Taylor and Fry in national data.

Overall, in 2014, upstate metropolitan counties had about 10% more low income residents living in majority low income census tracts than the average for all 948 metropolitan and micropolitan areas studied by Taylor and Fry, and 12% fewer high income residents living in majority high income census tracts.  These differences are relatively large – they point to the fact that low income residents are substantially more likely live in low income census tracts in upstate New York than in the nation as a whole.  With regard to high income residents, the reverse is true in upstate metropolitan areas – upstate high income residents are more likely to live in middle class census districts than is true nationally, and significantly less likely to live in high income census tracts.

The change in the distribution of low and high income residents by census tracts median incomes can be seen in the following chart:

% of Group Living in Majority Same Income Census Tract
Upstate Metropolitan Areas vs. Nat’l Metro/Micro Areas
Year/Region Low Income High Income
2000- National 25% 16%
2000- Upstate 37% 7%
2010- National 28% 18%
2014- Upstate 38% 6%

Chart 4.

income distribution

Chart 4 shows that while there is a concentration of low income residents on the left of the chart – the portion showing census tracts having low median incomes, the largest number of low income residents live in census tracts with near average median incomes.  In fact, using the Taylor-Fry middle income group (from 67% of median household income to 2 times median income), 61% of low income residents lived in middle income census tracts.  In 2000, the comparable figure was 63%.  For high income residents, 89% lived in middle income census tracts in 2014, compared with 90% in 2000.  So, most low and high income residents live in middle income census tracts.

All of this points to the reality that the use of the term “segregation” by Taylor and Fry overstates the reality of the differences in living patterns between high and low income residents – both in upstate New York and in the nation.

Distribution of Households by Income Groups

 Taylor and Fry found that between 1980 and 2010, the percentage of households with middle incomes declined from 54% to 48% of the total.  The percentage of low income households stayed steady at 32%, while the percentage of upper income households increased from 15% to 20%.  Taylor and Fry found little change between 2000 and 2010, with the only change in the distribution of incomes being an increase in the percentage of high income households from 19% to 20%.

Distribution of Households by Income Group
Upstate Metropolitan Areas vs. Nat’l Metro/Micro Areas
Year/Region Low Income Middle Income High Income
2000- National 32% 50% 19%
2000- Upstate 33% 50% 17%
2010- National 32% 48% 20%
2014- Upstate 35% 45% 20%

Upstate metropolitan counties saw a larger shift between 2000 and 2014. Neighborhoods in upstate urban areas had increases in the percentages of low and high income households, while the percentage of middle income households decreased from 50% to 45%.

Implications

In earlier posts, I pointed out disparities in poverty and income between upstate cities and their suburbs, and between white, black and Hispanic residents.  This research extends the analysis to the neighborhood level.  Because this neighborhood analysis does not treat cities as separate units from communities in the rest of counties outside cities, it finds less residential segregation than the city/outside city analysis that was the subject of my earlier posts.  In fact, because cities are not treated separately, the dire condition of some city neighborhoods gets lost in the overall picture.

Nevertheless, there are significant differences in the residential patterns of many poor neighborhoods, compared to the population as a whole.  The data shows that about 30% of them live in neighborhoods where low income households are a majority of all households.  These low income neighborhoods have high concentrations of minority residents, high levels of unemployment and poverty.

Similarly, while poverty was present in most neighborhoods, about thirty percent of families living in poverty lived in neighborhoods where poverty was highly concentrated, with about half the families in those neighborhoods living in poverty.  These neighborhoods had high concentrations of black and hispanic residents.

My next post will look at race in upstate urban neighborhoods, an area where there is more separation

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[1] “The Rise of Residential Segregation by Income,” Paul Taylor and Richard Fry, Pew Social and Economic Trends, Washington, D. C., August 1, 2012.  http://www.pewsocialtrends.org/files/2012/08/Rise-of-Residential-Income-Segregation-2012.2.pdf

[2] Ibid, p. 1

[3] The Taylor-Fry study defined low income as having less than two thirds of the national median income (34,000 in 2010) and high income as more than double the national median income (104,000).