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Inner Cities Still Losing Jobs

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AP / CBS
Many of America's inner cities continue to hemorrhage jobs despite years of federal programs designed to improve their economies.

Nearly half of the country's 82 largest municipalities lost jobs from 1995 to 2003, according to a new study by the Initiative for a Competitive Inner City. By comparison, only one of the surrounding metropolitan areas lost jobs during the same period.

A separate analysis by The Associated Press found that most inner cities targeted by the federal government's primary urban economic programs lost jobs as well.

In fact, the best-performing cities were not part of the federal empowerment zone and renewal community programs, which provide businesses with billions of dollars in tax incentives to expand and hire workers.

"It's sobering," said Michael Porter, a Harvard business professor who did the study for the Initiative for a Competitive Inner City. "It suggests that there are relatively few inner cities that are thriving in the sense of job growth."

Porter and his team analyzed how many jobs were added or lost in inner cities with more than 50,000 residents. They found that only 10 added jobs at a higher rate than surrounding metropolitan areas. All 40 inner cities that lost jobs did so faster than surrounding areas.

Among the best performing: Jersey City, N.J.; Long Beach, Calif.; Tulsa, Okla.; and Anaheim, Calif. Among the worst: Detroit; Grand Rapids, Mich.; Rochester, N.Y.; and Miami.

Thirty-two of the inner cities studied also had neighborhoods that were designated federal urban empowerment zones or urban renewal communities.

Of those, 12 showed an increase in jobs from 1995 to 2003. Only one, Mobile, Ala., added jobs at a higher rate than the surrounding metropolitan area.

"Whatever these programs were, the research and the experience suggests that their impact was marginal at best," said Alan Berube, a fellow at the Metropolitan Policy Program at the Brookings Institution, a think tank.

Brian Sullivan, a spokesman for the Department of Housing and Urban Development, said many businesses and communities have benefited from the programs. He said HUD is trying to better promote the tax incentives, especially among small-business owners.

But, Sullivan said, many communities could do more to remove local barriers to development, such as cumbersome regulations.

"We're not trying to preach to people that you are over-regulating," he said. "But it is true that in some parts of the country the regulatory climate puts out the unwelcome mat."

Examples?

"Take your pick," Sullivan said. "I don't want to point fingers."