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Demographic Changes in and near US Downtowns

For more than four decades, the demographic compositions of neighborhoods in and near the downtown areas of medium to large U.S. cities have been changing. Since 1980, residents in these areas have become higher income, better educated, and more likely to be white, on average. Though these changes began in the 1980s, these patterns of neighborhood change have become more widespread and dramatic since 2000.

To study these demographic changes in more detail, we examined census data for a group of 118 medium to large US cities—those whose metropolitan areas contained at least 250,000 people in 1970. We sorted census tracts in each metro area by income, education, and racial composition, and then we arranged them from lowest to highest within each category. Finally, we split each set of tracts into three equal parts, which allowed us to identify the top-tercile tracts for each measure in every time period. Then we focused on the population living within 5 kilometers (roughly 3 miles) of the metro area’s primary central business district (CBD), tracking how the share of residents living in a top-third census tract for each of the demographic characteristics changed within these areas over time.

The total population living within 5 kilometers of a CBD fell sharply in the 1970s and continued to decline to a lesser extent in the 1980s. But since 1990, it has been relatively stable at about 17 million people. On the other hand, because the population in metropolitan areas has continued to grow, the share of metropolitan area residents living near a CBD has fallen from 23.7 percent in 1970 to 13.6 percent in 2010.

The share of central-area residents (those living within 5 kilometers of the CBD) living in a neighborhood in the top-third of census tracts ranked by average household income fell dramatically from 13.3 percent in 1970 to 9.3 percent in 1980. It crept back up to around 11 percent in 1990 and 2000 and then increased to 15.3 percent in 2010. The large increase in people living in high-income neighborhoods near CBDs in the 2000s was accompanied by large increases in highly educated neighborhoods near CBDs and more white neighborhoods near CBDs.

To combine the average income, fraction white, and fraction college educated measures into a summary statistic, we standardize each measure by subtracting its mean and dividing by its standard deviation in each year and then taking the average of the three standardized measures. We refer to this summary statistic as a socioeconomic status (SES) index. While race is not a measure of SES, other research has shown that it is correlated with measures of economic status, such as wealth, even after controlling for income.

The average share (across metros areas) of central-area residents living in a top-third-SES-index neighborhood fell from 0.179 in 1970 to 0.154 in 1980 but has been climbing ever since. The largest uptick came in the 2000s when it jumped up by 4 percentage points, from 0.168 to 0.208. The figure below shows the share of central-area residents living in a top-tercile-SES-index neighborhood in 1980 and in 2010.

In 1980 most metro areas did not have a high share of central-area residents that resided in top-tercile-SES neighborhoods. Only New York City and Santa Barbara had shares above 0.45. However, by 2010, Atlanta, Charleston, Charlotte, Chicago, Houston, Orlando, and Washington also had shares above 0.45 of central-area residents residing in top-tercile neighborhoods. The number of cities with shares in the 0.30 to 0.45 ranges jumped from 8 in 1980 to 20 in 2010. The SES indexes of near-downtown neighborhoods in the remaining 98 metro areas in our sample are lower than would be expected if people were allocated to neighborhoods at random. However, all but 40 experienced growth in their downtown-area SES indexes between 1980 and 2010.

What is driving these changes in neighborhood choices? Why are neighborhoods close to downtowns becoming whiter, more educated, and higher income in cities across the country? These changes may be driven by increases in the sizes of higher SES demographic groups, like the college educated, or by increases in demand for these neighborhoods by certain high-SES demographic groups. Such increases in demand may have been driven by improvements in the amenities of such neighborhoods or by increases in labor demand by certain types of industries in downtown areas. We attempt to provide some possible answers in a forthcoming working paper.*

Demographic Changes in and near U.S. Downtowns

Trends in Downtown Population and Demographic Composition

Population within 5 kilometers of a central business district Share of population within 5 kilometers of CBD that lives in a top-tercile tract in the metro area (CBSA)
Total Metro area (CBSA) share Fraction white Fraction college educated Mean household income SES index
Panel A: Levels
1970 19,382,696 0.237 0.138 0.251 0.133 0.179
1980 17,332,137 0.190 0.140 0.268 0.093 0.154
1990 16,973,575 0.167 0.125 0.271 0.110 0.165
2000 16,967,954 0.149 0.125 0.270 0.117 0.168
2010 16,846,052 0.136 0.151 0.315 0.153 0.208
Panel B: Decadal Changes
1970-1980 −2,050,559 −0.047 0.002 0.016 −0.040 −0.025
1980-1990 −358,562 −0.023 −0.015 0.003 0.017 0.012
1990-2000 −5,621 −0.018 0.000 −0.001 0.007 0.003
2000-2010 −121,902 −0.013 0.026 0.045 0.036 0.040
1980-2000 −486,085 −0.053 0.011 0.048 0.060 0.054

Note: Numbers are calculated using data at the census tract level in each year. For Columns 2-6, each tract is weighted by tract share of the core-based statistical area (CBSA) population, such that each CBSA is equally weighted. Similar patterns exist for those living within the largest city in each CBSA.

Share of Central-Area Residents Who Reside in a Top-Tercile-SES Neighborhood, 1980 and 2010

Central city Combined statistical area 1980 2010
New York New York-White Plains-Wayne, NY-NJ + Nassau-Suffolk, NY Metropolitan Divisions 0.56 0.76
Chicago Chicago-Joliet-Naperville, IL Metropolitan Division 0.28 0.70
Portland Portland-Vancouver-Hillsboro, OR-WA Metropolitan Statistical Area 0.27 0.60
Charleston Charleston-North Charleston-Summerville, SC Metropolitan Statistical Area 0.35 0.53
Orlando Orlando-Kissimmee-Sanford, FL Metropolitan Statistical Area 0.30 0.49
Charlotte Charlotte-Gastonia-Rock Hill, NC-SC Metropolitan Statistical Area 0.19 0.47
Atlanta Atlanta-Sandy Springs-Marietta, GA Metropolitan Statistical Area 0.10 0.47
Santa Barbara Santa Barbara-Santa Maria-Goleta, CA Metropolitan Statistical Area 0.45 0.47
Houston Houston-Sugar Land-Baytown, TX Metropolitan Statistical Area 0.11 0.46
Washington Washington-Arlington-Alexandria, DC-VA-MD-WV + Bethesda-Rockville-Frederick, MD Metropolitan Divisions 0.22 0.46
Mobile Mobile, AL Metropolitan Statistical Area 0.21 0.45
Huntington Huntington-Ashland, WV-KY-OH Metropolitan Statistical Area 0.33 0.43
Greensboro Greensboro-High Point, NC Metropolitan Statistical Area 0.40 0.42
Seattle Seattle-Bellevue-Everett, WA Metropolitan Division 0.30 0.41
San Francisco San Francisco-San Mateo-Redwood City, CA Metropolitan Division 0.28 0.41
Madison Madison, WI Metropolitan Statistical Area 0.32 0.40
Boston Boston-Quincy, MA + Cambridge-Newton-Framingham, MA + Peabody, MA Metropolitan Divisions 0.19 0.39
Denver Denver-Aurora-Broomfield, CO Metropolitan Statistical Area 0.06 0.39
San Diego San Diego-Carlsbad-San Marcos, CA Metropolitan Statistical Area 0.17 0.38
Fort Lauderdale Fort Lauderdale-Pompano Beach-Deerfield Beach, FL Metropolitan Division 0.18 0.38
Memphis Memphis, TN-MS-AR Metropolitan Statistical Area 0.07 0.36
Austin Austin-Round Rock-San Marcos, TX Metropolitan Statistical Area 0.14 0.36
Tampa Tampa-St. Petersburg-Clearwater, FL Metropolitan Statistical Area 0.19 0.35
Tulsa Tulsa, OK Metropolitan Statistical Area 0.17 0.33
New Orleans New Orleans-Metairie-Kenner, LA Metropolitan Statistical Area 0.12 0.33
Chattanooga Chattanooga, TN-GA Metropolitan Statistical Area 0.08 0.32
Dallas Dallas-Plano-Irving, TX Metropolitan Division 0.05 0.31
Baton Rouge Baton Rouge, LA Metropolitan Statistical Area 0.19 0.30
Scranton Scranton--Wilkes-Barre, PA Metropolitan Statistical Area 0.33 0.30
Sacramento Sacramento--Arden-Arcade--Roseville, CA Metropolitan Statistical Area 0.23 0.30
Greenville Greenville-Mauldin-Easley, SC Metropolitan Statistical Area 0.26 0.30
Columbus Columbus, OH Metropolitan Statistical Area 0.10 0.29
El Paso El Paso, TX Metropolitan Statistical Area 0.12 0.29
Columbia Columbia, SC Metropolitan Statistical Area 0.18 0.28
Lancaster Lancaster, PA Metropolitan Statistical Area 0.24 0.28
Binghamton Binghamton, NY Metropolitan Statistical Area 0.29 0.27
Riverside Riverside-San Bernardino-Ontario, CA Metropolitan Statistical Area 0.42 0.27
Fort Worth Fort Worth-Arlington, TX Metropolitan Division 0.06 0.26
Edison Edison-New Brunswick, NJ Metropolitan Division 0.30 0.25
Harrisburg Harrisburg-Carlisle, PA Metropolitan Statistical Area 0.21 0.24
Nashville Nashville-Davidson--Murfreesboro--Franklin, TN Metropolitan Statistical Are 0.10 0.24
Pittsburgh Pittsburgh, PA Metropolitan Statistical Area 0.09 0.24
Rochester Rochester, NY Metropolitan Statistical Area 0.14 0.23
Shreveport Shreveport-Bossier City, LA Metropolitan Statistical Area 0.19 0.23
Miami Miami-Miami Beach-Kendall, FL Metropolitan Division 0.15 0.22
Tacoma Tacoma, WA Metropolitan Division 0.19 0.22
Philadelphia Philadelphia, PA Metropolitan Division 0.11 0.22
Augusta Augusta-Richmond County, GA-SC Metropolitan Statistical Area 0.22 0.21
Jacksonville Jacksonville, FL Metropolitan Statistical Area 0.08 0.21
Buffalo Buffalo-Niagara Falls, NY Metropolitan Statistical Area 0.11 0.21
Honolulu Honolulu, HI Metropolitan Statistical Area 0.32 0.21
Oakland Oakland-Fremont-Hayward, CA Metropolitan Division 0.10 0.21
Salt Lake City Salt Lake City, UT Metropolitan Statistical Area 0.15 0.20
Norfolk Virginia Beach-Norfolk-Newport News, VA-NC Metropolitan Statistical Area 0.07 0.20
Little Rock Little Rock-North Little Rock-Conway, AR Metropolitan Statistical Area 0.11 0.19
Baltimore Baltimore-Towson, MD Metropolitan Statistical Area 0.02 0.19
Peoria Peoria, IL Metropolitan Statistical Area 0.24 0.19
Corpus Christi Corpus Christi, TX Metropolitan Statistical Area 0.16 0.19
West Palm Beach West Palm Beach-Boca Raton-Boynton Beach, FL Metropolitan Division 0.20 0.18
Jackson Jackson, MS Metropolitan Statistical Area 0.16 0.18
Lansing Lansing-East Lansing, MI Metropolitan Statistical Area 0.22 0.18
Milwaukee Milwaukee-Waukesha-West Allis, WI Metropolitan Statistical Area 0.12 0.17
Rockford Rockford, IL Metropolitan Statistical Area 0.17 0.17
Spokane Spokane, WA Metropolitan Statistical Area 0.19 0.17
Cincinnati Cincinnati-Middletown, OH-KY-IN Metropolitan Statistical Area 0.14 0.16
Providence Providence-New Bedford-Fall River, RI-MA Metropolitan Statistical Area 0.21 0.16
Saint Louis St. Louis, MO-IL Metropolitan Statistical Area 0.00 0.15
Erie Erie, PA Metropolitan Statistical Area 0.15 0.15
Louisville Louisville/Jefferson County, KY-IN Metropolitan Statistical Area 0.06 0.15
Syracuse Syracuse, NY Metropolitan Statistical Area 0.19 0.14
Richmond Richmond, VA Metropolitan Statistical Area 0.06 0.14
New Haven New Haven-Milford, CT Metropolitan Statistical Area 0.15 0.14
Albuquerque Albuquerque, NM Metropolitan Statistical Area 0.09 0.14
Albany Albany-Schenectady-Troy, NY Metropolitan Statistical Area 0.33 0.13
Minneapolis Minneapolis-St. Paul-Bloomington, MN-WI Metropolitan Statistical Area 0.12 0.13
Cleveland Cleveland-Elyria-Mentor, OH Metropolitan Statistical Area 0.02 0.13
Worcester Worcester, MA Metropolitan Statistical Area 0.14 0.13
San Antonio San Antonio-New Braunfels, TX Metropolitan Statistical Area 0.02 0.12
Bakersfield Bakersfield-Delano, CA Metropolitan Statistical Area 0.26 0.12
Wilmington Wilmington, DE-MD-NJ Metropolitan Division 0.07 0.12
Davenport Davenport-Moline-Rock Island, IA-IL Metropolitan Statistical Area 0.24 0.12
Reading Reading, PA Metropolitan Statistical Area 0.24 0.12
Oklahoma City Oklahoma City, OK Metropolitan Statistical Area 0.04 0.12
Tucson Tucson, AZ Metropolitan Statistical Area 0.12 0.12
Utica Utica-Rome, NY Metropolitan Statistical Area 0.28 0.12
Allentown Allentown-Bethlehem-Easton, PA-NJ Metropolitan Statistical Area 0.21 0.11
Grand Rapids Grand Rapids-Wyoming, MI Metropolitan Statistical Area 0.09 0.10
Phoenix Phoenix-Mesa-Glendale, AZ Metropolitan Statistical Area 0.16 0.10
San Jose San Jose-Sunnyvale-Santa Clara, CA Metropolitan Statistical Area 0.06 0.09
Akron Akron, OH Metropolitan Statistical Area 0.11 0.09
Kansas City Kansas City, MO-KS Metropolitan Statistical Area 0.00 0.09
Wichita Wichita, KS Metropolitan Statistical Area 0.08 0.09
Beaumont Beaumont-Port Arthur, TX Metropolitan Statistical Area 0.11 0.08
Canton Canton-Massillon, OH Metropolitan Statistical Area 0.18 0.08
Omaha Omaha-Council Bluffs, NE-IA Metropolitan Statistical Area 0.04 0.07
Stockton Stockton, CA Metropolitan Statistical Area 0.05 0.06
Dayton Dayton, OH Metropolitan Statistical Area 0.04 0.06
Los Angeles Los Angeles-Long Beach-Glendale, CA Metropolitan Division 0.02 0.05
Las Vegas Las Vegas-Paradise, NV Metropolitan Statistical Area 0.20 0.05
Hartford Hartford-West Hartford-East Hartford, CT Metropolitan Statistical Area 0.05 0.04
Camden Camden, NJ Metropolitan Division 0.00 0.04
Fort Wayne Fort Wayne, IN Metropolitan Statistical Area 0.16 0.04
Flint Flint, MI Metropolitan Statistical Area 0.11 0.04
Fresno Fresno, CA Metropolitan Statistical Area 0.03 0.03
Des Moines Des Moines-West Des Moines, IA Metropolitan Statistical Area 0.08 0.03
Knoxville Knoxville, TN Metropolitan Statistical Area 0.12 0.02
Bridgeport Bridgeport-Stamford-Norwalk, CT Metropolitan Statistical Area 0.02 0.02
Santa Ana Santa Ana-Anaheim-Irvine, CA Metropolitan Division 0.03 0.01
Youngstown Youngstown-Warren-Boardman, OH-PA Metropolitan Statistical Area 0.05 0.00
Trenton Trenton-Ewing, NJ Metropolitan Statistical Area 0.00 0.00
Gary Gary, IN Metropolitan Division 0.00 0.00
Oxnard Oxnard-Thousand Oaks-Ventura, CA Metropolitan Statistical Area 0.00 0.00
Toledo Toledo, OH Metropolitan Statistical Area 0.02 0.00
Kenosha Lake County-Kenosha County, IL-WI Metropolitan Division 0.03 0.00
Springfield Springfield, MA Metropolitan Statistical Area 0.17 0.00
Indianapolis Indianapolis-Carmel, IN Metropolitan Statistical Area 0.00 0.00
Detroit Detroit-Livonia-Dearborn, MI + Warren-Troy-Farmington Hills, MI Metropolitan Divisions 0.12 0.00
Newark Newark-Union, NJ-PA Metropolitan Division 0.00 0.00

Note: The socioeconomic status (SES) index is a summary statistic which combines the average income, fraction white, and fraction college educated. To calculate it, we standardize each of the component measures by subtracting its mean and dividing by its standard deviation in each year and then taking the average of the three standardized measures.


  • *Baum-Snow, Nathaniel and Daniel Hartley, forthcoming. “The Causes and Consequences of Gentrification and Neighborhood Change in US Cities, 1980-2010,“ Federal Reserve Bank of Cleveland working paper.

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