Local Area Personal Income data for 2005 was released by the federal Bureau of Economic Analysis at the end of April, and the data shows the continuation of longstanding trends and conditions in New York City and State. Nationally, per capita income for the year was $34,471, but for New York City it was 21 percent higher (despite our high poverty rate), for the Downstate Suburbs it was 49 percent higher, for the New York Metropolitan Area as a whole it was 31 percent higher, and for New York State as a whole it was 16 percent higher. The dataset, which begins (for some series) in 1969, shows that all of these areas suffered a substantial decline in income, relative to the national average, in the 1970s and staged a recovery in the 1980s. Changes have been less dramatic, but still significant since then. It also shows that Manhattan and the Downstate Suburbs are really wealthy, but most of the rest of New York State is relatively poor, with Upstate not doing as poorly compared with New York City’s outer boroughs as the relative level of complaint would suggest. Spreadsheets are attached; the discussion continues after the jump.
The wealth of Manhattan continues to be almost unbelievable. The borough’s 2005 per capita income of $93,377 was nearly triple the national average and the highest of any county in the country. Wyoming’s Teton County, home to Jackson Hole, was second at $89,028, and Colorado’s Pitkin County, home to Aspen, was third at $77,970. Those counties have less than 34,000 people between them. Manhattan has more than 1.6 million. At 271 percent of the national average, Manhattan’s 2005 per capita income is down from 288 percent of the average in 2000, but is up from 258 percent of the average in 1990, at the end of the 1980s boom. No other borough of New York City has a higher per capita income, relative to the national average, than in 1990.
Taken collectively, however, the per capita income in Downstate New York Suburbs is 149 percent of (49% higher than) the national average for 2005, the same percentage above average as in 1990 though down slightly from 2000. In the portion of the New York Metropolitan Area in New Jersey the per capita income was 133% of the U.S. average in 2005, up slightly from 1990. Of the 558 counties with 100,000 residents of more, Westchester had the 6th highest per capita income, Nassau the 15th, Rockland the 39th, Putnam the 54th, and Suffolk the 68th. Several counties in Northern New Jersey are also in the top 50, while Fairfield County in Connecticut, not part of the New York MSA by current definitions, is third.
And where to residents of these suburban counties get all their income? An analysis by the Department of City Planning and the Long Island Regional Planning Board in the 1990s showed that the highest paid residents of these counties, who earn a large share of their total income, work in Manhattan which, as mentioned previously, accounts for about half of all the private sector earnings in New York State, if the primarily government-funded health care and social assistance sector is excluded.
The “gentrification” of Brooklyn has become a global cultural phenomenon and local political issue as the affluent and near affluent, spilling out of Manhattan, move to formerly working-class neighborhoods close to that borough, but BEA data shows that for Brooklyn as a whole the trend has been exaggerated. The per capita income of Kings County was at the national average in 1969, but just 85 percent of that average after the devastation of the 1970s, in 1979. Recent demographic trends have caused some hipsters to pine for the 1970s, but perhaps there is no need. In 2005, Brooklyn’s per capita income was just 83% of the national average, up a tiny amount from 82 percent of that average in 2000. Clearly the gentrification of neighborhoods in north and west Brooklyn has been balanced by the replacement of older middle class native-born residents by working class immigrant families on the borough’s southern rim.
No New York City borough’s per capita income has fallen farther, relative to the national average, than that of Queens, where the replacement of older middle class native-born residents by working class immigrant families is ongoing but gentrification has barely begun. In 1969, this borough’s per capita income was 132 percent of the U.S. average, or about as wealthy as Northern New Jersey is today. People forget that Brooklynites fled to Queens as well as Nassau and Suffolk in the 1960s, that Queens airports replaced Brooklyn seaports as the city’s leading high-wage industrial sector in that decade. The bust of the 1970s and the boom of the 1980s left Queens’ per capita income at 113 percent of the national average in 1990, and by 2000 it was just 94 percent of the national average (6 percent below average). That is about where it was in 2005 as well.
No borough’s per capital income has fallen lower than the Bronx, whose 2005 per capita income at just 68 percent of the national average is actually up from 65 percent in 2000. Of the 558 counties with 100,000 people or more that year, the Bronx had the 24th lowest per capita income. Even Staten Island (Richmond County) has become relatively poorer of late. Per capita income there was 115 percent of the national average in 1969 and a little higher, at 118 percent of that average in 1990 after the 1970s bust and 1980s boom. That’s when the borough decided it wanted to secede from New York City. By 2005, Staten Island’s per capita income was just 109 percent of the national average, below the New York City average, and going down. No one seems to talk about secession anymore. Perhaps sharing a tax base with Manhattan isn’t so bad, even if the poor Bronx comes as part of the bargain.
Every county in the Downstate Suburbs had a higher per capita income, relative to the national average, in 2005 than in 1990 (at the end of the 1980s Northeast recovery). Every New York City borough save Manhattan is lower, and the city has a whole is down 9 from 130 percent of the national average in 1990 to 121 percent of that average in 2005. Upstate New York, the source of most of the state’s economic complaints, is down 5 from 95 percent of the national average in 1990 to 90 percent in 2005. And unlike New York City’s outer boroughs (all of which but Staten Island are poorer than the average for Upstate) this region has lost little in relative income since 1994. In fact, Upstate New York, taken together, has a higher per capita income than the outer boroughs, taken together. But the cost of living in Upstate is low, while the cost of living Downstate is inflated by wealth of those in Manhattan and the suburbs.
The per capita income of the portion of Upstate located outside Metro areas (rural New York), in fact, has lost little since the 1970s, although that means it was largely bypassed by the 1980s Northeast recovery. Rural New York’s per capita income was at 77 percent of the national average in 1979, and at 78 percent of the national average in 2005. While not high, it is higher than the Bronx and nearly as high as Brooklyn, but the cost of living is much lower. Apparently government transfers limit how far a New York rural area can fall, given farm subsidies, state colleges, prisons, Social Security, and tourism. In the tiny Ithaca MSA, where Cornell University provides stability, per capita income is about the same relative to the national average as it was in 1969.
Among Upstate Metro areas, the Capital District and the Hudson Valley are close to the national average in per capita income, and have lost little over the years. The Rochester MSA and its Monroe County, which were well above the national average in per capita income in 1969, had much to lose and have lost much – the former was at just 98 percent of the national average in 2005, the latter at 105 percent. This remains the wealthiest part of Upstate east of Schenectady – and beyond the economic influence of New York City. But Niagara and Broome Counties, which were not so wealthy to begin with, have fallen by about as much as Monroe County relative to the national average since 1969, though both have per capita incomes at about the level of Brooklyn despite a lower cost of living. Elsewhere Upstate the relative decline has been smaller.
In summary, no matter how much elected officials from Upstate New York say New York City should pay more and get less because it is wealthy, the needs in the city’s outer boroughs are as great or greater. And no matter how much elected officials from the Downstate Suburbs say New York City should pay more and get less because it is poor, much of their wealth comes from within the city’s borders (more on that in my next two posts on this data). If present trends continue – with neighborhoods becoming relatively poorer when their housing stock hits 50 years old and is passed down, and gentrifying in a wave moving out from Manhattan some time afterward, it is possible that per capita income in the Bronx, Brooklyn and Queens could start to rise, and per capita income in the now fully-developed Downstate Suburbs start to fall, in the future. That was not the case, however, as of 2005.