[image_credit]MinnPost photo by Peter Callaghan[/image_credit][image_caption]In Hennepin and Ramsey counties, 40 percent of neighborhoods experiencing high poverty are newly poor, meaning they had poverty rates of less than 20 percent in 1980 and 30 percent or more in 2018.[/image_caption]
According to new research by the Economic Innovation Group, a research and advocacy organization focused on inequality, there were 19 high-poverty neighborhoods in the Twin Cities in 1980. By 2018, that number had grown to 41.
Those findings are important for two reasons: One, they show that once a neighborhood becomes a high-poverty neighborhood, it usually stays that way. And two: they show that the Twin Cities are a microcosm of the economic challenges facing the country.
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Newly poor
For their report, EIG researchers examined poverty rates for Census tracts, small units of geography containing between 1,000 and 8,000 residents that approximate neighborhoods. Neighborhoods were considered high-poverty if more than 30 percent of residents were living below the poverty line at the time. (The current statewide poverty rate is 9.6 percent.) In 2018, a family of four would be considered to be living in poverty if their household income was under $25,465, according to the U.S. Census Bureau.
From there, researchers split neighborhoods into four categories: newly poor, deepening poverty, persistently poor and turned around.
In Hennepin and Ramsey counties, 40 percent of neighborhoods experiencing high poverty are newly poor, meaning they had poverty rates of less than 20 percent in 1980 and 30 percent or more in 2018.
In Minneapolis, this includes tracts in Near North, Camden, Powderhorn and Cedar-Riverside. In St. Paul, this group includes parts of Summit-University, the North End, Payne-Phalen and Dayton’s Bluff.
The tracts are mostly in the core cities; part of Brooklyn Park that saw its poverty rate go from 5 percent in 1980 to 31 percent in 2018 is the only high-poverty suburban Census tract in Hennepin or Ramsey County by EIG’s measure.
Like the Brooklyn Park tract, Some of these neighborhoods saw poverty grow substantially between 1980 and 2018.
Deepening poverty
Roughly a fifth of the high-poverty Census tracts identified in the study were poor in 1980 and saw that poverty increase over the last forty years. Researchers defined neighborhoods where poverty had deepened by looking at places with a poverty rate between 20 and 30 percent in 1980 that increased to 30 percent or more in 2018.
In Minneapolis, that includes the northwest portion of Seward along Hiawatha, Stevens Square and a swath of Near North. In St. Paul, parts of Union Park, the West Side and Thomas-Dale. Although most of these neighborhoods have seen a reduction in their poverty rates since the Great Recession, they still have poverty rates more than 30 percent — higher than in 1980.
One example of this is the Stevens’ Square area in Minneapolis, south of downtown. This neighborhood went from 29 percent of residents living in poverty in 1980 to 43 percent today.
The part of Willard-Hay in Near North Minneapolis bounded by Penn and Plymouth has seen poverty deepen since the 1980s, going from 29 percent of residents living below the poverty in 1980 level to 41 percent in 2018.
Persistently poor
Roughly another third of tracts experienced persistent poverty — poverty rates were 30 percent or above in both 1980 and 2018.
Minneapolis’ persistent poverty neighborhoods include several tracts in Near North and Phillips, much of the area hugging downtown, as well as Cedar-Riverside. St. Paul’s include parts of Thomas-Dale, Summit-University and the North End.
One example of a neighborhood with persistent poverty is the Thomas Dale area surrounding the state Capitol. The area has seen poverty rates between 40 and 60 percent for the last 40 years.
High poverty neighborhoods are generally high turnover neighborhoods. People move in, and out, renters move from building to building. The people living in a given home are changing, yet the poverty in these neighborhoods is persistent.
“Once a community dips into decline, it’s very hard to pull back out of it based on how residential markets are structured,” said Kenan Fikri, EIG’s director for research and an author of the research. “Once housing vacancies increase in a neighborhood and property values decline, all of a sudden it leads to just a negative spiral.”
Leaving poverty
The study also looked at neighborhoods where the poverty rate decreased — turnaround neighborhoods. Neighborhoods had turned around if they had a poverty rate of 30 percent or more in 1980 and less than 20 percent in 2018.
Examples of these neighborhoods were few nationwide: just 14 percent of neighborhoods that were high poverty in 1980 turned around by 2018. These neighborhoods generally tend to be near downtowns or innovation districts, and many of them were in New York City.
[image_credit]MinnPost photo by Peter Callaghan[/image_credit][image_caption]In Hennepin and Ramsey counties, there’s just one example of a turnaround neighborhood. It’s the North Loop, where turnaround was driven by new residential development.[/image_caption]
Race and poverty
People who live in poverty are more likely to face hurdles with everything from health care to transportation and child care. When people in poverty live in high-poverty areas, those challenges are compounded by higher crime rates, poorer health outcomes, struggling schools and a lack of job networks.
“There are a set of issues wrapped up in neighborhood poverty that reflect systemic challenges facing the United States along cultural, social, demographic and racial lines,” Fikri said.
These neighborhoods also play a role in cementing other inequalities: In the Twin Cities, high-poverty areas tend to be segregated, with people of color — especially Black people — making up a large share of residents. Those patterns of segregation have deep roots in racially restrictive covenants and redlining, which dictated who could live where and who could buy housing, affecting patterns of education and generational wealth.
While the majority of Black residents of Hennepin and Ramsey counties do not live in high-poverty areas, Black residents are seven times more likely to be living in a high poverty neighborhoods than white residents, compared to six times more likely nationally.
The picture of Minnesota one the whole is one broad-based prosperity, Fikri said, but more targeted strategies are needed to reduce disparities.
“You need to address not just poverty, but workforce development, education, even social capital and networks. Most people find jobs via other folks in their social network,” Fikri said. “Those networks in a highly segregated city — not just focused on racial lines but economic lines, means there’s complicated forces keeping poor places poorer.”
That, he said, makes the Twin Cities a microcosm of the challenges facing the country right now.
“It’s a powerful symbol right now. Minneapolis is a quintessentially blue chip metropolitan economy. It is the headquarters capital of the world almost,” he said. “It is a poster child of American prosperity on the surface, but then underneath you have these really deep pockets of persistent poverty and inequality that haven’t been able to be overcome despite the wealth generated on the metropolitan scale.”
And Racism caused it all?
Employer resistance to paying a living wage for lower-end jobs, the fact that nothing about real estate prices and the real estate “market” is based on the fiscal reality of many / most families, and the racist and segregationist chickens of decades past coming home to roost: all combine for a less-than-congratulatory twist on “Minnesota nice.” Economic bigotry is just as ugly as cultural, ethnic or racial bigotry, and, ugly or not, it’s quite evident in all three of the metro areas where I’ve lived, usually accompanied by one of the other forms of bigotry.
A response that “That’s just the way it is” is both logically and ethically stupid, and more importantly, dangerous-to-fatally so for any sort of return to – or development of – a genuinely democratic society and the institutions that would support such a society. The occasional feel-good story about someone working their way out of the poverty into which they were born doesn’t – or at least shouldn’t – allow us to sweep under the collective rug the fact that poverty, like wealth, tends to be self-sustaining.
Structural racism, structural sexism, and structural poverty are not automatic in a society unless we as citizens allow them to become so. This is, at least in my own mind, why Ayn Rand’s “I’ve got mine. Screw you.” mind set corrodes everything and everyone it touches. Beyond being undemocratic politically, it’s fundamentally in humane.
Free market capitalism doesn’t allow for the things you claim are structural. Govt regulations are what creates those things.
I’m pretty sure Ayn Rand never said any such thing.
Free market capitalism? In the US? Surely you jest.
No, she preferred “What are the masses but mud to be ground underfoot, fuel for the fire of the deserving” (probably not 100% verbatim, it’s been a while, but close enough to get the gist).
Bob, Rand wrote and entire book promoting selfishness, and of course that “ethic” permeates almost everything else she wrote.
Ayn Rand argued for rational and ethical egoism (rational self-interest), as the guiding moral principle. She said the individual should “exist for his own sake, neither sacrificing himself to others nor sacrificing others to himself”.
If you kill all the rich people who pays the taxes?
“Ayn Rand . . . said the individual should ‘exist for his own sake, neither sacrificing himself to others nor sacrificing others to himself’”.
So how do you explain a second-rate screenwriter and wannabe philosopher going on Medicare and Social Security, to pay for the illness she incurred by smoking? Or the foundation organized to glorify her memory taking federal bailout funds under the CARES Act?
Well, it wasn’t Ayn Rand paying taxes. She lived off of government handouts. Not only was her writing absurd and cruel, she was also a fraud and a hypocrite.
38 years isn’t exactly “newly”. That’s a pretty long time span. Most of this likely can be traced to offshoring manufacturing. Those jobs were how the middle class came to be and thrived. Moving from good paying manufacturing jobs to low paying service jobs is not a good trend.
Also, all the debt creation since 1980 has further eroded purchasing power making more people poor. If you aren’t getting close to 10% annual raises, you’re falling behind.
I think you’re on to something there Mr Barnes.
Offshoring manufacturing is the direct result of free market capitalism.
Much of the loss in real incomes of working class Americans can be traced to the destruction of unions that began in the 1980s.
Nonsense. Offshoring manufacturing jobs was due to govt intervention and slave like conditions in 3rd world nations. Free market capitalism can’t work outside our shores because we can’t control other nations/govts. China et al don’t allow free market capitalism. If they did, wages there would be similar to here and there would have never been any incentive to move out of the US.
I think you have it backwards. The appalling conditions and wages in countries to which manufacturing has been offshored are what we would be seeing in the United States, but for government intervention. You don’t think the Triangle Shirtwaist fire was caused by the heavy hand of regulation, do you?
Forgot to add that unions aren’t why people are falling behind (not to mention unions are bad for the workers anyway and have outlived their usefulness) It’s the expansion of the money supply via deficit spending (unbacked debt creation). The M2 money supply chart has been increasing by at least 6% annually for more than 2 decades. Very few people get a 6% annual wage increase. When the money supply expands, the value of the money you hold goes down thus your purchasing power is lowered (ie you’re poorer).
“Outlived their usefulness?”
Yes, employers all over the country have said that they have learned their lesson, and will start treating workers the way they deserve and pay them good wages, because they have learned that it is the right thing to do.
The destruction of unions goes back to the passage of Taft-Hartley in 1947. Union density peaked then, then went into decline. Most of the best tactics to organize became illegal.
The trend accelerated in the 80s, when the public gleefully supported the destruction of PATCO. That one was the easy case, and it set a political precedent.
Minnesota has a disabled population of 24.6%. Part of the reason that many of these people are disabled is a lack of opportunity to engage in profitable home-based businesses. During the last special session of the legislature, grants of $10,000 were available with many caveats. One of the caveats was that home-based businesses were ineligible.
Many people stop thinking about home-based businesses at the notion of multi-level marketing business at which few people excel. But their are other home-based businesses, such as selling on Amazon.com Prime, insurance sales, and real estate sales.
Both real estate and insurance agencies and brokerages use a modified MLM structure in their sales organizations to promote formal recruitment and training. I was involved with a national insurance and securities brokerage training group for three hours once a week for several months, which I was able to do despite my difficulty working the traditional workplace. Had I access to a car, which I have never owned, I would have been out of poverty after completing the training and testing. I tested at 80% to 100% in a national program administered by a school in Florida over the Internet. In 2002, I trained for real estate at what is know Kaplan University in Saint Paul, a national organization of in-class and Internet training. My national score for the state exam was 86.5%; my state score on the state exam barely eked out a passing score, but I passed.
My pitch is to get the government to agree to allowing certain home-based businesses to be considered for $10,000 grants for disabled people, irrespective of Covid-19 and losses due to the pandemic. I took a financial literacy course offered by the insurance and securities brokerage that I found, and have cured myself of the desire to spend on credit — a past poison pill for me.
The investment into our disabled community would mean bringing people off of public and federal assistance and allowing them to engage in activities which may help them find a way out of disability altogether.
The 26.4% statement was meant to mean that 26.$% of the disabled population is in poverty.
The disabled figure that I presented neglected to indicate that that pecent of people in the disability community are in poverty. I am one of them.
Please see Page 41 of the following Minnesota state data on percent of disabled in Minnesota who are disabled; the data presents information on people in poverty without disability (7.5%).
https://www.disabilitystatistics.org/StatusReports/2015-PDF/2015-StatusReport_MN.pdf?CFID=4101698&CFTOKEN=8b2ceb4ed1b0c5e8-D0BD1FCA-E607-A6EE-C193073D3215BA13#:~:text=Poverty%3A%20In%20MN%20in%202015,with%20disabilities%20was%2024.6%20percent.
This is a must read for policy-makers who wish to promote inclusivity to people who may find themselves away from both disability and poverty were the right programs instituted. I have not been helped by the MN Department of Vocational Rehabilitation, which does not permit its employees to counsel people on business development.
Thanks for this information Barry. I was unaware of this additional element of bias.
Anyone remember the Holman Project that took down the Sumner-Field public housing? It was a redevelopment project the city promoted as a crusade to eliminate an “area pf excessive concentration of race and poverty.” Meanwhile the city not only turned a blind eye to the far greater concentration of race and poverty in Riverside Plaza, it did everything it could to help the owner build his real estate empire.
As Greta Kaul’s article would predict, Riverside Plaza has remained a concentration of race and poverty. Being a government-subsiidized dependable source of income for the owner, it continues to be milked as a cash cow. Periodically it gets repaired, enough to stay in operation.
We rebuilt 9 properties on the 100 block of Charles Avenue, in Thomas Dale, near the State Capitol, the area noted in your artlicle as deeply .poor.
Five have been sold. None of the owners or our tenants are poor. What gives?
There are two large apartment complexes, each 130 units, across the street. Many, if not most, are subsidized housing. Both were sponsored by the City. The City sponsored these poverty numbers.
A decade or more ago, I spoke with Bob Fletcher, at one time a member of the City Council. I complained that our neighborhood had poor lighting, bumpy streets, subpar playgrounds. He said “No, you’re wrong –your neighborhood gets just as much money as any other. It’s just that it is spent on policing.
Ah.
After the recent spate of protests and needless destruction, the National Guard and St. Paul Police chased the drug users and homeless out of downtown — and straight up the hill, just past the Capitol, into our neighborhood.
Tonight, our neighbors will gather, with lowly staff from the police and City Council, to discuss strategies to repel the invasion. Most are deeply sympathetic to the homeless and addicted. I am proud to call each neighbor and friend. But they want to live in peace, without constant commotion and thievery.
Until and unless the City and County and State decide to spend 2 or 3 times as much money on the children of poverty, as they do on others, this will persist. Just read former Mayor Betsy Hodges editorial in the NY Times on maintaing privilege in Minneapolis.
I am not holding my breath.
We rebuilt 9 properties on the 100 block of Charles Avenue, in Thomas Dale, near the State Capitol, the area noted in your artlicle as deeply .poor.
Five have been sold. None of the owners or our tenants are poor. What gives?
There are two large apartment complexes, each 130 units, across the street. Many, if not most, are subsidized housing. Both were sponsored by the City. The City sponsored these poverty numbers.
A decade or more ago, I spoke with Bob Fletcher, at one time a member of the City Council. I complained that our neighborhood had poor lighting, bumpy streets, subpar playgrounds. He said “No, you’re wrong –your neighborhood gets just as much money as any other. It’s just that it is spent on policing.
Ah.
After the recent spate of protests and needless destruction, the National Guard and St. Paul Police chased the drug users and homeless out of downtown — and straight up the hill, just past the Capitol, into our neighborhood.
Tonight, our neighbors will gather, with lowly staff from the police and City Council, to discuss strategies to repel the invasion. Most are deeply sympathetic to the homeless and addicted. I am proud to call each neighbor and friend. But they want to live in peace, without constant commotion and thievery.
Until and unless the City and County and State decide to spend 2 or 3 times as much money on the children of poverty, as they do on others, this will persist. Just read former Mayor Betsy Hodges editorial in the NY Times on maintaining privilege in Minneapolis.
I am not holding my breath.
The lead photo looks like a pretty nice neighborhood with well maintained houses and nice newer vehicles. Is that supposed to be one of the neighborhoods under discussion?
The conundrum of the conundrum! Example: Our local City Council representative is peed off because of what he calls “Gentrification” , well W/O some level of gentrification communities will never move out of low income! i.e. more low income rentals will not produce a higher income neighborhood. Part 2, if we want lower income folks to rise to a income, style of life, the answer is not to make it easier to keep low income folks low income by telling them its all (someone else’s fault) and not enforcing ordinances etc to the same magnitude level as you would in higher income neighbor hoods. in short that looks like income /minority/racial prejudice as noted above in other comments. We all got to live by the same laws and expectations, To The writers point, my suspension is that low income neighborhoods stay low income because there are too many bleeding hearts that refuse to ask people to step up, and prefer to in reality push them down, by suggesting they don’t have what it takes (its someone else’s fault) that they are in the situations they are in. Higher expectations typically lead to higher performance. (Yes, I live and have lived for > 36 years in one of these suggested neighborhoods.
Bleeding hearts eh? Low income is about… low income. Bleeding hearts haven’t been holding wages and salaries down for decades. You guys just keep getting more and more irrelevant with every passing year.
As someone who lives in a census tract that is here highlighted as “newly poor,” I submit that the analysis for the St Paul and Minneapolis numbers is terribly superficial and cliche-ridden. It does not correspond to what I have experienced in the years since 1980, in one specific tract.
This article, especially in its analysis, cherry-picks the areas it chooses to discuss. It leaves out huge areas where the demographics don’t fit the same old same old explanations of racism and restrictive housing rules, etc. In the census tract I’m most familiar with, it was real estate speculation after some institutional changes in public policy, and a loss of city regulatory controls, that caused a huge increase in poverty, even though the increase in people of color doesn’t factor in. The instability is there, the lack of money and real investment is there. Just for other reasons than systemic racism.
Disappointing journalism, I’m afraid. Up your game, MinnPost.
I read these articles just hoping somebody will state the obvious. But it never happens. The obvious reason most people are poor is because they have children before they have secured a committed partner to raise the kids and have not developed a marketable job skill. Those that do this are extremely unlikely to be poor. Am I suppose to accept that some people will have one or two kids with no capacity to raise them properly and that its the responsibility of the rest of society to take care of these people ? If that is the model, I believe our decline as a society will be swift regardless of how many tax dollars you shift from the productive to the unproductive.
Please someone write an article about the importance of families and education in a modern society.
Jon, if everyone stopped having kids until they had affluent incomes 60% of the people in this country would never have kids. The problem isn’t children, the problem is decades of stagnant wages. Children aren’t driving up poverty, low wages are driving up poverty… what part of : “low wages” is so confusing to people around here?
Fix the public schools, fix the poverty problem. Education is the way out of poverty.
Okay, how to fix it? The good manufacturing jobs started disappearing in the 70’s. Change the tax code so it costs more to import something made in China ( or any other foreign country ). Germany has been doing this for many years. Create public/private partnerships to build plants in the distressed parts of town. Control Data did it in the 70’s. They also build a training center to teach people the trade.
We really need to do something like this to get decent paying jobs back. Outsourcing has to end. Politicians aren’t going to want to do this, it will take a lot of push from ordinary people.
But lost in this conversation is the responsibility of black people to do something about the black gangs. Nobody wants to talk about it, but this conversation needs to be had, along with the issues surrounding police brutality. So please get Black Lives Matter to explain what they are going to do to stop the daily shootings going on between the gangs in the Twin Cities.
“Change the tax code so it costs more to import something made in China ( or any other foreign country ). ” Wouldn’t the consequence be the cost of a great number of goods increasing significantly? Like most items on the shelf at big box stores? The low cost of goods from China that may allow a poor family to live much better then they may otherwise. Having the low cost import option on a lot of items is a blessing to my finances for sure. Sometimes the best is not needed to get a job done. It really is a shame that previous generations supported the destruction of purchasing power and manufacturing. It will be hard to come back from where were are on those fronts.
Ben, we tried “buy American” back the 70’s and 80’s. You buy stuff that hasn’t been manufactured in the US for 50 years, we’re not a manufacturing economy anymore. And you can’t force the private sector to lose profit in order to pull their manufacturing back the US.
It was the corporate fiduciary requirement for investor return that drove manufacturing out of the country, not consumers.
“But lost in this conversation is the responsibility of black people to do something about the black gangs.”
What are you, personally, doing about the KKK and the Aryan Nations?
“What are you, personally, doing about the KKK and the Aryan Nations?”
RB! You’re not expecting the “personal responsibility” guys to take personal responsibility for something are you?
Greta, how does this reflect the number of low income people and people living in poverty that have moved to the Twin Cities since 1980?