Chicago’s new demographics: ‘A third San Francisco, two-thirds Detroit’

Mayor Lori Lightfoot has vowed to make neighborhood development and diversity—making the city that works work for everyone—a central part of her mayoral legacy. As she said in her acceptance speech, “This is not us versus them. Or neighborhoods versus downtown. We are in this together and will grow together.”

It’s a vital goal, especially as the economic fortunes of Chicago continue to bifurcate and create a tale of two cities. It’s also one that’s become increasingly more difficult, as wrenching economic shifts and the legacy of segregation conspire to create a larger economic divide between neighborhoods.

According to a new analysis of Chicago demographics by urbanist Pete Saunders, the two economic narratives emerging across two wildly different sets of Chicago neighborhoods are being reflected in changing demographics. The downtown and Near North Side, stretching from the Loop to neighborhoods such as Bucktown and Logan Square, has boomed in ways similar to superstar cities such as New York, D.C., Seattle, and Austin, while large stretches of the rest of the city have suffered from decreasing middle class populations, disinvestment, and in the worst cases, abandoned property and increased crime.

“On its own, the portions of the city that includes the Loop, north lakefront, West Loop, and Logan Square have the population of San Francisco, are about the size of Manhattan and nearly as dense, and have been booming,” he tells Curbed. “It’s as safe, vibrant, and walkable as any of the other cities you’d associate with success.”

The arrival of a young, more high-tech workforce

Saunders, an urban planner and writer who publishes at Corner Side Yard and just began a job as economic development director in south suburban Richton Park, says that the city is undergoing a demographic transformation, with an influx of younger, richer workers, clustering in this central and near North Side of the city. In addition to well-documented neighborhood disparities in terms of income, home value, education, investment, and job opportunity, this shift tracks a large-scale shift in the city’s population.

His analysis of U.S. Census Data found that between 2005 and 2017, the city of Chicago’s 25-39 year-old age cohort grew 15.7 percent, while falling dramatically in the rest of Cook County (7.2 percent drop) as well as the metro area outside of Cook County (5.9 percent decline).

In addition, between 2005-17, Chicago’s population of 25-44 year-olds with a bachelors degrees or additional advanced degrees grew 42 percent. As Saunders wrote in a Twitter thread sharing his findings, “An older, less educated, manufacturing-oriented populace is being replaced by a younger, more educated, knowledge-economy populace.” Chicago now has a higher share of college educated workers than the surrounding suburbs.

Chicago’s core growth has been fueled by extensive investment in real estate (the city has ranked toward the top of the list for construction cranes for years) and a wave of corporate relocations (PricewaterhouseCooper listed Chicago as a global “city of opportunity”). A recent Brookings report found Chicago was part of a group of four large, dense metros that contributed to much of the nation’s downtown job density growth: the metro areas of New York, Chicago, San Francisco, and Seattle accounted for almost 90 percent of the increase in job density seen among all 94 large metro areas from 2004 to 2015.

But recent economic growth has been unevenly distributed. According to recent UIC research, in 1970, roughly half the city was considered middle income. In 2017, that distinction applied to just 16 percent of Chicago. Income segregation and extreme, concentrated poverty have become more pronounced. Saunders called it Global Chicago versus Rust Belt Chicago.

“A few years ago, I published something on my personal blog that characterized Chicago as one-third San Francisco and two-thirds Detroit,” he says. “I caught some flack from Rahm Emanuel for that, and I get it. Nobody wants to be associated with Detroit; it’s my hometown, so I know how that goes.”

An economic gap with lacking a social solution

Chicago’s legacy of segregation—freezing people of color from the physical and economic networks that would have helped spread more growth across the city—has created patterns that will need a social solution. Saunders sees the issue as more of a social than economic problem, despite the large economic toll. The city needs to invest in workforce development and education, and helping employers and employees connect in different ways.

A 2017 report by the Metropolitan Planning Council and Urban Institute, “The Cost of Segregation,” found that if the city’s above-average black-white segregation levels were simply reduced to meet the national level, the city’s economy would generate $8 billion more annually. In addition, an average black household in Chicago earns 47.3 percent of what an average white household makes, less than the nationwide rate of 60.1 percent. Chicago is so much larger, area-wise, than many other metros, Saunders says, which prevents some of the dynamic downtown growth from impacting neighborhoods historically excluded from opportunity.

That inability to connect to opportunity, and the loss of industrial and manufacturing jobs that used to provide stable employment, has caused frustration and in many cases, exodus. Experts from the Urban Institute predict that by 2030, Chicago’s African-American population will shrink to 665,000 from a post-war high of roughly 1.2 million. Many neighborhoods on the South and west sides have seen the middle class leave for opportunities in other cities such as Dallas and Atlanta, a kind of reverse Great Migration.

This tricky balance of encouraging economic and job growth, while connecting disinvested communities to these new sources of opportunity, will be one of, if not the key challenges, of Lightfoot’s administration.

“There are a lot of residents of Chicago who feel left out,” Saunders says. “They’re disconnected economically and socially, and find it difficult to connect.”