New Cleveland Fed research finds that urban neighborhoods have grown more educated, well to do

The two studies look at changes in the number, ages, and financial status of those moving into and out of urban neighborhoods and provide 12 facts about temporary urbanists.

Between 1950 and 2000, most urban neighborhoods in the United States were losing population to suburban development, and that population loss has resulted in declining tax bases, shrinking revenues, and a struggle to maintain cities’ infrastructures.

But between 2000 and 2017, the total population in urban neighborhoods rose from 51.6 million to 60.5 million people, an increase of 17.2 percent. Analyzing consumer credit data, Federal Reserve Bank of Cleveland researcher Stephan Whitaker finds that this increase in urban populations is the result of young adults migrating into urban neighborhoods and senior citizens aging in place. He says urban populations have also become more educated and well to do.

Whitaker finds substantial increases in the share of urban residents who hold undergraduate and graduate degrees, as well as increases in the number of high-income individuals. He says the migration patterns of people with strong credit histories suggests that urban living is a lifestyle of choice for many, rather than a refuge only for people who cannot afford suburban housing.

According to Whitaker, “While declining urban neighborhoods may still outnumber growing urban neighborhoods within some regions, urban leaders there can work toward population or tax base growth knowing that consumer tastes and national trends are favorable to those goals.”

Read more: Population, Migration, and Generations in Urban Neighborhoods

Urban areas seem to be enjoying a renaissance of sorts due in part to the many young professionals who have moved into central neighborhoods since the 2000s. In a related study, Whitaker answers 12 questions about temporary urbanists—those who choose to move into an urban neighborhood and spend part of their early adulthood there.

The popular view is that young adults move into a dense central neighborhood of some major city after college, enjoy a short commute and urban amenities, establish their careers, and find a spouse. Many of these young professionals are thought to move back out after they have started families, but the details of these migration patterns are not well-known.

Whitaker provides some quantitative evidence of the phenomenon and a better understanding of who the temporary urbanists are. “We have confirmed that most are from relatively advantaged backgrounds and are more likely than their peers to become suburban homeowners,” says the researcher. Whitaker also finds that many temporary urbanists downshift to a smaller metro area when they move out of an urban neighborhood, but they are more likely to settle in a more populous area than where they grew up.

Read more: 12 Facts about Temporary Urbanists

Federal Reserve Bank of Cleveland

The Federal Reserve Bank of Cleveland is one of 12 regional Reserve Banks that along with the Board of Governors in Washington DC comprise the Federal Reserve System. Part of the US central bank, the Cleveland Fed participates in the formulation of our nation’s monetary policy, supervises banking organizations, provides payment and other services to financial institutions and to the US Treasury, and performs many activities that support Federal Reserve operations System-wide. In addition, the Bank supports the well-being of communities across the Fourth Federal Reserve District through a wide array of research, outreach, and educational activities.

The Cleveland Fed, with branches in Cincinnati and Pittsburgh, serves an area that comprises Ohio, western Pennsylvania, eastern Kentucky, and the northern panhandle of West Virginia.

Media contact

Doug Campbell, doug.campbell@clev.frb.org, 513.455.4479