Report: Big Apple Losing Its Middle Class

by: David Sirota

Thu Feb 05, 2009 at 20:25


This report from the Center for an Urban Future basically says that for the middle class, there really is no future in New York City. Because of idiotically high housing prices and massive gentrification, the Big Apple is losing its middle-class at an astounding rate.

I can't say that I'm surprised - I've always found myself shocked that anyone can afford to live in New York City because it's so expensive. I mean, obviously it's absurd for anyone to claim that you can't make ends meet there on $180,000 a year (ie. 4 times the median household income in the United States) - you absolutely can (and can live pretty well on that much cash). But "middle class" is not $180,000 a year - that's upper class, whether in New York City or anywhere else. And New York is a ridiculously expensive place where being middle class - truly middle class - is obviously tough.

I guess the day of reckoning is finally - and unfortunately - happening. The city that has long been the place of racial, cultural and class ferment is watching its heart - its middle-class - be replaced by the super-rich. Pretty sad, if you ask me.

David Sirota :: Report: Big Apple Losing Its Middle Class

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Report: Big Apple Losing Its Middle Class | 45 comments
This is not new (4.00 / 4)
New York started losing the middle class when Giuliani became mayor.

The move to turn this city into the playground for the rich and power was masked as an effort to rid the city of crime and drugs.

I'm sorry to say that New York's middle class is partially to blame for their own demise.  

actually it started before that (4.00 / 3)
in the 70s and 80s with the destruction of the manufacturing industry and the move to replace it with Finance Insurance and Real Estate (FIRE).

Giuliani helped a lot though ;)

Also, as a rule of thumb, anything bad that happens in New York City elections - it's always Staten Island's fault :)

[ Parent ]
Really (4.00 / 1)
Growing up in The Bronx and Queens, we always blamed New Jersey
[ Parent ]
And we blamed you guys for the crowded highways (4.00 / 1)
loss of open space, demise of the small truck farms and general loss of civility.  :)
[ Parent ]
they didn't elect Giuiani ;) (4.00 / 1)

[ Parent ]
TheTrap (4.00 / 2)
is a book that chronicles very well the shift in income-producing power that occurred in the New York metro area that shifted the economic leverage of those involved in non-financial pursuits to Wall St. For instance, teachers in Manhattan used to make an equivalent wage to stock brokers. And now, the two jobs are nowhere near to each other in terms of income.

Save Our Schools! March & National Call to Action, July 28-31, 2011 in Washington, DC: http://www.saveourschoolsmarch...
[ Parent ]
silver lining (4.00 / 2)
Though rents are falling!

Fritz Frigan, executive director of sales and leasing at Halstead Property estimates that when these incentives are considered, rents are actually down some 10 percent to 15 percent since the market peak in mid-2007.

It's the bright side of global economic calamity.

they think that a 1-bedroom for 3000 instead of 4000 is affordable tho -- (0.00 / 0)
it's sick.  
[ Parent ]
So... (0.00 / 0)
Solution.... (4.00 / 3)
I live in San Francisco where we are having the same problem. I also happen to work for an affordable housing company. Every unit of housing we build in SF allows a lower or middle class family to live in the city that otherwise would have been priced out. The problem is, this type of housing is limited, and in densely populated urban areas it is difficult and expensive to acquire new land or even existing buildings for redevelopment.

If I had my way, the city would use its power to fast-track and incentivize not-for-profit affordable housing complexes - and give them priority over normal market-rate developments. Literally cut the red tape for them as a matter of public necessity. Of course, this costs the city more lucrative developments, so they won't do it. Instead we get half-measures that help some people but don't stop the inevitable wave of prohibitively high housing costs.

To put it more succinctly, this is a city problem and cities need to address it aggressively. Federal/state funding can help, but first and foremost cities need to find the will to prioritize affordable housing as an urgent and mandatory public need.

"Don't hate the media, become the media" -Jello Biafra

[ Parent ]
move to London (0.00 / 0)
and try to stop history from  repeating itself.

or move to Philadelphia, which is much more livable.

[ Parent ]
It's not like London is great (4.00 / 1)
My flatmates and I pay £500 a week for a place in Tottenham (which for those who don't know, is a fairly run-down area quite a way out from the city centre). Luckily it's affordable as there are five of us, but I'm still paying individually more than my girlfriend's parents are paying for their entire house. I'm moving out of the city in the summer and can't even find rents as expensive as that when looking at things that are basically mansions.

I think New York's major problem is lack of space. You've got a city perched on one spit of a not particularly large island. There's barely room enough as it is, and the big changes needed to make it more affordable aren't going to help with that.

Forgotten Countries - a foreign policy-focused blog

[ Parent ]
the city is much more than just Manhattan -- (4.00 / 6)
it's not lack of space so much as it's the intentional changing and eliminating of laws and zoning regulations and rent protections etc that helped us for decades, and the enormous no-strings tax breaks and subsidies corporations get for new construction -- even if they then fire thousands.

the rent regulation changes they made took hundreds of thousands of affordable apartments out of middle-class reach entirely, and made them all too expensive.

and the continual loss of tons of jobs in all our giant local industries (financial, media, fashion, publishing, small manufacturers, etc) while solid govt and union jobs get continually cut or just lost too ... it's all been ongoing for ages.

[ Parent ]
in london the police are racist too (4.00 / 1)
but not nearly as efficient.  Even more people get free health care (in NY it's only twice the medicaid limit last i checked and that's if they know about it and user it), which cuts down on costs and allows you to not be a slave to your employer.  And worst comes to worst you can squat, without fear of having to engage in a massive street battle with the police.  And that's not counting all the benefits you get if you're a British / EU citizen.

So it is expensive here, and I think on average London is feels marginally less safe than New York (depending on where you go and whether that's just me), but I think it's a far easier place to be low income, having been that in both places.  People still believe in something here...like public goods.

And iut's two hours from Paris :)

[ Parent ]
Safety (4.00 / 1)
I dunno.  The only time I've not felt safe in London was in the farther-out parts of the East End.  The rest of it seemed fine, and even that was no different in feel from parts of the East Village in Manhattan.
[ Parent ]
it seems safe (0.00 / 0)
but you can get pickpocketed / petty crime almost anywhere it seems like.  But then, like I said, I'm not from here - I've only felt really unsafe in New York in Bushwick because of the gentrification everywhere else I went (even Washington Heights and whatnot) (And maybe, like you (or someone? said) in Alphabet City after Avenue C.  Perceptions of safety in New York are very class/race-based though.
[ Parent ]
London? (0.00 / 0)
That's a joke, right?
[ Parent ]
sort of :) (0.00 / 0)
it's more like "if you have the means and ability to move and get a visa, then it's a nicer place to live because they give you health care and the politics are better."  But most people who are poor/working class/middle class in New York aren't going to be able to do that - so like the large numbers of Black people that left New York for cities like Atlanta that are more affordable, they'll do that within the United States.  Philadelphia is quite nice and underpopulated.
[ Parent ]
i should say (0.00 / 0)
another  mass movement in new york is probably better and will work best if it's the folks wedded to the city.
[ Parent ]
You CAN live in NYC for much less than $180k (4.00 / 5)
But it's becoming much, much harder to do it for anyone who isn't grandfathered into a nice rent controlled apartment or willing to live pretty far outside the most desirable areas and/or forgo many of the kinds of things that make a big city worth living in, like going to nicer restaurants, taking in Broadway shows, visiting museums except when they have their weekly or monthly free/optional fee night, etc.

If you're willing to do this or are very creative, you can live fairly nicely in NYC, but most middle class people don't have the time, energy or desire to live this way. It's basically become a city for the very rich, the very poor (who live at and on the fringes), the very young (and thus willing to do without), or the very creative, patient and resourceful. I.e. NOT the middle class.

And yes, I know that this isn't as much the case if you're willing to live in Queens, Staten Island, the Bronx, or the further out parts of Brooklyn, but then that just splits NYC into 2 cities, the inner, desirable part, and the outer part where regular people live, which is not so bad but hardly what you think of when you think of NYC.

"Those who stand for nothing fall for anything...Mankind are forever destined to be the dupes of bold & cunning imposture" -- Alexander Hamilton

I looked into living there... (4.00 / 2)
...and I have friends who do. You can afford an efficiency on as little as $50k a year if your other expenses aren't high (as a single adult). That's in Manhattan.  

"Don't hate the media, become the media" -Jello Biafra
[ Parent ]
A long as you don't have children (4.00 / 3)
Either living alone or with your spouse, as long as you don't have children and both have decent-paying full time jobs, you can live in Manhattan.  But if you have a kid or two, it's very difficult to live in Manhattan even on two middle-class full-time salaries, assuming you can't all live in a 1 BR.  But it's perfectly doable in the other boroughs.  
[ Parent ]
I lived on the UWS for over 8 years in the 90's (4.00 / 2)
on both less than and more than $50k, which varied as I had a series of jobs then, and you could definitely do it, with some effort and lots of compromises. And I didn't live in some dingy 5th floor broom closet in a dilapidated tenement with 5 roommates, but by myself in a smallish but not tiny studio with a tiny separate kitchen in decent condition in a 12-story doorman building, whose small size was more than made up for by its being less than a block from Central Park and having a glorious view of the Museum on Natural History, which was conveniently right across the street, and since I lived on a high floor, I could see all the way across it, and if I stuck my head out the window I could see a small sliver of the Hudson and NJ on one side and the park on the other. There were plenty of cafes, stores, bookstores, restaurants, etc., nearby, and each Thanksgiving I got to see the balloons being inflated the night before from my window (a la Seinfeld, whose character lived a few blocks away, and whose actual apartment I could see from my window in the distance). I was even able to keep a car the whole time and park it on the street (which, as anyone who's done the same knows, involved a lot of driving around to find parking the night before or morning of alternate side of the street cleaning).

Ah, I'm getting nostalgic now. But there was a downside, because after paying for rent and other essentials like food and utilities, there wasn't a lot left over for fun stuff. But I managed somehow. And, believe it or not, food was not a huge expense, if you knew where to shop and what to buy and how to cook. Plus, the area was getting to be increasingly yuppified and took on the feel of a permanent Wall St. meets refined frat boy meets Martha Stewart suburb within a city, and if you weren't making a lot of money, you felt it. And when the mini-recession and then 9/11 hit, I couldn't afford it anymore and between that and the gloom that hit the city, I had to leave. Which I'm glad I did, because Seattle is a lot more liveable on a day to day basis, and instead of a beautiful museum and park I can see snow-covered mountains from my window.

That was nearly 10 years ago, so I don't know what it's like now, but I imagine that it's still possible but a lot harder to live there for just $50k. Perhaps that will change due to the recession, but with so much luxury construction and conversion over the past 10 years, I'm guessing that a lot of properties will just sit unoccupied as their owners go bankrupt. Or, perhaps, a lot of underpriced higher-end properties will be coming on the market soon.

"Those who stand for nothing fall for anything...Mankind are forever destined to be the dupes of bold & cunning imposture" -- Alexander Hamilton

[ Parent ]
Commuting is tough from out there (4.00 / 3)
I grew up in parts of The Bronx and Queens where it could take 2 hours to get to Manhattan.

But that's where the middle class is.  

[ Parent ]
Yup (4.00 / 4)
It never took me that long by train, but I've lived in both boroughs and commuting can be a hassle, especially in the summer when it's so hot in the stations. I've done it by LIRR too, when on lived on LI, which is more expensive but far more comfortable and faster. And if it took you this long, I'm guessing that you lived near Jamaica Bay in an area like Canarsie, Sheepshead Bay or Howard Beach. Not every part of NYC is convenient to Manhattan, especially if you need to do a bus-train connection. Wouldn't it be cool if they brought back streetcars and trollies and put in light rail?

"Those who stand for nothing fall for anything...Mankind are forever destined to be the dupes of bold & cunning imposture" -- Alexander Hamilton
[ Parent ]
The Other Problem Is Education (4.00 / 1)
In many neighborhoods the elementary schools are good to very good but once you get to middle and high school it is much harder to find good ones.  We have a 10 month old and we love city life but we will probably have to leave NYC when our daughter gets to middle school age.  We can't afford private school.  I am sure that is also driving middle class flight.
[ Parent ]
I got lucky (0.00 / 0)
I took a test and got into one of the name schools, but the one that I was zoned for had shootings. The commute was a hassle, but well worth it for the education I got (and bullets I dodged). This was back in the early 80's when stuff like that happened. There are good public middle schools, but you either have to live in the right school zone or take a test.

Hopefully, by the time your child is old enough, the school situation will be much better. It has to be if we're to survive as a modern country.

"Those who stand for nothing fall for anything...Mankind are forever destined to be the dupes of bold & cunning imposture" -- Alexander Hamilton

[ Parent ]
the new re-regulation of some apts may help -- if it goes thru (0.00 / 0)
that's been a nightmare -- (at 2000/month and over they get de-regulated so too many landlords added chintzy appliances and windows and pushed the rent over that line on purpose)

Assembly Passes Rent-Regulation Revisions Opposed by Landlords -- http://www.nytimes.com/2009/02...

(NFR83, i'm from The Bronx too -- now Midtown)

Pelham Gardens (4.00 / 1)
just north of Pelham Parkway off Eastchester Road.

Then I moved to Middle Village, Queens where I currently live.  

[ Parent ]
Mosholu Pkwy -- (4.00 / 2)
I grew up there, and have lived only in Queens and Manhattan since (and my mother only paid 149/month back then -- rent-control days)

I'm by Javitz/Lincoln Tunnel now and my neighborhood is rapidly changing daily--they rezoned the whole area--but thankfully it's slowing and/or stopping now bec of no financing for more new skycrapers and luxury housing.

The end of Mitchell-Lama and the conversion of Union housing, etc --  and the loss of tons of back-office and other jobs has contributed enormously to people moving away too.

But on the bright side, we have over a million kids in the school system (our future middle class), and we've always been a sharp, tough crowd who know how to make our way. : >

[ Parent ]
That's not a bad area in some ways (4.00 / 1)
9th Avenue has some really nice and cheap restaurants--I used to eat at a Chinese place called Mee's on 53rd (which had the best shrimp hot and sour soup ever) and some other places when I worked in the area years ago--and it's not that far from everywhere else, especially the West Village, midtown and the upper west side. And of course you have the newish west side park. I don't know if you've been there long enough but they used to show second run recent films at Worldwide Plaza for $2 until around 10 years ago, which I also miss.

"Those who stand for nothing fall for anything...Mankind are forever destined to be the dupes of bold & cunning imposture" -- Alexander Hamilton
[ Parent ]
i love my neighborhood -- (0.00 / 0)
i'm just hoping they don't sell my bldg to put a tower up.
[ Parent ]
Heh, I know the sorts of people (0.00 / 0)
who do that sort of thing. I'll put in a good word. Although, in this economy, no one's putting up so much as a tin shack let alone a tower for quite a while.

"Those who stand for nothing fall for anything...Mankind are forever destined to be the dupes of bold & cunning imposture" -- Alexander Hamilton
[ Parent ]
I guessed wrong then (above)! (0.00 / 0)
I grew up not that far away in Flushing, and had a bus-train trip to the city. The Bronx remains mostly a mystery to me except Van Cortlandt Park, which I ran cross country in for a year. Tough course.

"Those who stand for nothing fall for anything...Mankind are forever destined to be the dupes of bold & cunning imposture" -- Alexander Hamilton
[ Parent ]
heh i did that too :) (0.00 / 0)
i don't remember it  being tough, but i do remember being really bad at cross country :)
[ Parent ]
The new numbers on vacancy decontrol are actually high enough this time (4.00 / 3)
I was in Albany when they were negotiating renewing the rent regulations laws...which the Senate Republicans were holding hostage.  Even back then $2000 a month for decontrol was far too low a number.

The new number is $5000 a month.  This means a lot fewer apts will deregulated in the future.  With rents going down, if the law is written correctly, some decontrolled apts could be recaptured.  

I think the rent control numbers are very important in trying to regain some of the middle class here in NYC, particularly Manhattan.

Essentially it's the cost of real estate, residential more than commerical, but commmercial too as well.....that has exacerbated this trend.

Yes the City economy is far too dependent on the financial service industry.  And we need to diversify the City's esonomic base more.  

"Incrementalism isn't a different path to the same place, it could be a different path to a different place"
Stoller

[ Parent ]
Manhattan Is A Real Problem (4.00 / 2)
Certain parts of Manhattan were always expensive but you had areas like Hells Kitchen, the East Village, Chelsea, etc which were always affordable.  The combo of the condo craze and rent deregulation above $2K has made everything south of 96th Street ridiculously expensive.  The only way you can afford it is to either make a lot of money or be lucky enough to have a rent stabilized apt.

I grew up in the city in the late 1970s and while I don't want a return to the days where I got mugged numerous times as a kid I feel like we have completely missed the mark in remaking NYC.  So many neighborhoods feel like the Mall of America now with chains on every corner.  I keep wondering if there is a way to undo it and gain a decent balance both in terms of shops and apt affordability.

[ Parent ]
Well, if the economy gets as bad as everyone expects it to (0.00 / 0)
then that just might happen, in unplanned fashion. Once a certain percentage of people foreclose on or move out of their overpriced apartments, nearby business will close, and a downward spiral will take over, leading to cheaper apartment and rental prices. But we all know what tends to go along with that in dense urban areas.

"Those who stand for nothing fall for anything...Mankind are forever destined to be the dupes of bold & cunning imposture" -- Alexander Hamilton
[ Parent ]
the best way to do it is to promote community organizing (Formal and informal) among poor/working class people (0.00 / 0)
For example, organizations like New York civic Participation Project and Make the Road by Walking and ACORN - though with every new turn of history there are new organizations that need to come up and new forms of organizing.

I spent a lot of time trying to think about this as a gentrifier in crown heights (more cultural than economic) and I thought that, short of pouring urine in elevators, the only non-violent means for promoting community change and for people with less power to protect themselves is for them to get together and figure out what's going on and fight it.  The people who were opposed to the Ratner development were able to do that because they have some means, more or less, and it was a fight between the middle class and the upper class, but the people who are below them often don't.  But that's going to change I think.

It is important that accurate information and good strategy and tactics be formed though.

[ Parent ]
$180K IS middle class in NY (4.00 / 2)
Upper-middle, to be sure, but still middle. It's two people making $90K. You can hardly put them in the same category as the rich.  
Yup, isn't that sad? (0.00 / 0)
Even for NYC. My parents bought a house in Queens in the mid-70's for under $40k. It probably goes for more than 10 times that now. No way have average salaries gone up anywhere near as much since then, except at the very high end, which $180k is not in NYC.

"Those who stand for nothing fall for anything...Mankind are forever destined to be the dupes of bold & cunning imposture" -- Alexander Hamilton
[ Parent ]
New York muggers and criminals take note (4.00 / 2)
Instead of taking your victims to the nearest ATM at gunpoint to withdraw the maximum, from now on you should pressure them for their Cayman Island and Swiss bank account numbers along with the password, and then have them do a funds transfer on their own Blackberry to your account, which should be established at a bank in an outlaw regime that has no banking law agreements with the US, like North Korea or Iran.

So instead of that mugging getting you $600 from an ATM, you could perhaps net 60 million through your victims online banking connection.  :-)

Bravo! (0.00 / 0)
Thanks for this beautiful idea, Robin, and if you ever need a friar for your merry band, think of me!
[ Parent ]
they already do this (4.00 / 3)
they just changed their name to bankers.
[ Parent ]
The results (4.00 / 1)
Shockingly, both New York state and New York City are below the national averages for median household income although not by much (Census Bureau data for 2006and 2007 plus the attached report).  Given the documented high cost of living, that's a travesty.

What's driving this?  Concentration of wealth and income in the city are amazing.  The NY Times ran an analysis of NY City payrolls (including the private sector) for the first quarter maybe two years ago.  IIRC, 16% of the individuals accounted for 64% of the income.  It was mostly the upper end of FIRE and assorted professionals like doctors and lawyers.  Ironically, the article included protestations that the numbers were inaccurate or misleading because Wall Street bonuses were included.

The City is being transformed rapidly from what it was as little as ten years ago.  If 750,000 New York City residents left in a 5 year period  (the report states no totals but mentions that as an annual figure) and the population is the same the obvious conclusion is that recent immigrants are filling the lower ranks of the city's economy.  Go up a step and the result is a mix of 20 somethings and immigrants.  This is what the report stated and this seems to be happening.

A society that skews its financial rewards into fewer and fewer hands is inefficient and unpleasant for most of its residents.  Overall income drops.  Bushonomics doesn't work.  The greed of the few should not and can not override the needs of the many.    

Report: Big Apple Losing Its Middle Class | 45 comments
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