Poverty, Unemployment Rates Higher for Young Adults in Detroit than City’s Overall Rates

In the City of Detroit the percentage of young adults (categorized as 16 to 34-year-olds in this post) living at or below the poverty level in 2015 was 42 percent, with the labor force participation rate for that same age group being 64 percent and the unemployment rate being 35 percent. Two out of three of these rates were above those for the City of Detroit overall. In 2015 the percent of all Detroit residents (including children) living below the poverty level was 40 percent, the labor force participation rate was 63 percent and the unemployment rate was 13.2 percent.

While the trend for these above mentioned rates for the young adult population was to be above the overall rates for the City, a deeper look at the rates showed they varied across Census Tracts in the City. For example, Census Tracts with the highest percentage of young adults living in poverty were along Grand River on the West Side and along Gratiot on the east side of the City. On the east side of the City, majority of the Census Tracts had between 50 and 90 percent of young adults living at or below the poverty level. Fortunately some of these same Census Tracts had among the lowest populations of young adults living there, with several having between 46 and 452 young adult residents residing in each Census Tract.

In the northeastern portion of the City, there were about a dozen Census Tracts with among the highest number of young adults living there, with numbers ranging between 667 and 1,742. These Census Tracts also had some of the highest labor force participation rates, as did a pocket in the western portion of the City of Detroit, along with several other pockets throughout the City. The tracts with the low labor force participation rates (29-48 percent) were frequently the same ones that had the highest percentage of young adults living at or below the poverty level; these Census Tracts are just east of Hamtramck. An individual is considered part of the labor force if they have a job or are actively seeking one. The labor force participation rate is the percentage of adults who are members of the labor force.

Two of these Census Tracts just east of Hamtramck also had among the highest unemployment rates for young adults, ranging between 59 and 89 percent. Overall in the City there were only 20 Census Tracts where between 59 and 89 percent of young adults were unemployed. Again, some of the tracts arrayed along Grand River on the west and Gratiot on the east had very high unemployment rates.

There are some tracts where high poverty, labor participation and unemployment rates overlap, but this is not the case for a majority of the Census tracts. At the same time the data tend to indicate a larger percentage of young adults are unemployed and, thus, living in poverty than the overall Detroit population. Clearly, getting more young adults employed must be a very high priority, and given that the national rate of unemployment is approaching 4 percent, there should be opportunities to connect these young adults to the labor market. Clearly it should be a priority to target job development and training programs to areas near Central High School along Grand River, as well as along Gratiot and in the Osborn and Demby areas.

Infant Mortality Rate Highest in Wayne County

In Southeastern Michigan, Wayne County had the highest infant mortality rate in 2016 at 8.3 deaths per 1,000 births, according to data from the Michigan Department of Health and Human Services. Of the 23,146 births in Wayne County in 2016 there were 192 deaths. St. Clair and Washtenaw counties had the second highest rates in the region, each at 5.7 deaths per 1,000 births. In St Clair County there were nine infant deaths out of the 1,591 births in 2016 and in Washtenaw County there were 21 infant deaths of the reported 3,695 births that year. Of the seven counties Livingston County had the lowest infant mortality rate. According to the data, there were four infant deaths in Livingston County in 2016 of the reported 1,783 births.

The Michigan Department of Health and Human Services data shows that every other county in Southeastern Michigan, with the exception of Washtenaw County, also experienced a decline in its infant mortality rate between 2015 and 2016. For Washtenaw County the infant mortality rate for 2016 was reported at 5.7 deaths per 1,000 births and for 2015 it was 3.8 deaths per 1,000 births.

 

Historical data from the Michigan Department of Health and Human Services shows the 2016 infant mortality rate of 8.3 for Wayne County is the lowest it has been since at least 1989. Data from the department shows that in 2015 the infant death rate in Wayne County was 9.5, in 2014 it was 9.3 and in 2013 it was 9.1. These rates, aside from the 2016 rate, were also the lowest reported rates for Wayne County since at least 1989.

 

According to an August Detroit News article infant mortality rates have declined in Detroit. The article discusses how research correlates higher rates of infant death to disparities such as poverty, access to food and lack of access to education, transportation and health care. In 2016 the infant mortality rate for Detroit was reported at 13.1 per 1,000 infants and in 2015 it was reported at 14.4. The infant mortality rate for the state of Michigan in 2016 was 6.8 deaths per 1,000 births.

 

While data shows that infant death rates are decreasing in Southeastern Michigan there are still concerns over pregnancy related maternal death rates in Michigan. Drawing Detroit is working with the Michigan Department of Health and Human Services to obtain this data to examine how rates have changed over recent years.

 

 

 

Distribution of Public Assistance Benefits Often Overlaps in Detroit

In examining Census data from 2015 we see that households throughout Detroit receive various forms of public assistance, in addition to incomes such as retirement, social security, and/or supplemental social security. The data presented in this post shows that, often, Census tracts with a higher percentage of households that received a retirement income had lower percentages of households that received public cash assistance and/or food stamps.

When examining the retirement income map the data shows that the Census tracts with the highest percentage of households that received retirement income were in the northern and western portions of the City. In addition, there was a handful of Census tracts east of Woodward Avenue with upwards of 34 percent of households earning a retirement income. Conversely, there were more than 80 Census tracts, primarily located southwest of Highland Park and Hamtramck, where less than 17 percent of the households receive a retirement income.

There were 29 Census tracts in Detroit where 44.9 percent or more of households relied on Social Security as part of their income and, on the opposite side of the spectrum there were about 40 Census tracts where 22.9 percent of those households, or less, relied on Social Security as part of their income. There was often an overlap in Census tracts with the highest percentages of households receiving retirement income and the highest share of households on on Social Security. But, there were differences across these maps as well. For example, many parts of Southwest and Midtown had both large percentages of residents receiving both retirement income and Social Security.

There was less of an overlap on Census tracts with the highest percentage of households receiving Social Security and tracts where many residents received Supplement Social Security benefits. In order to be eligible for Supplemental Social Security an individual must be: age 65 or older, blind or disabled and have a limited income and resources. Additionally, there was an overall higher percentage of households receiving Social Security benefits than Supplemental Social Security benefits. The Census tract with the highest percentage of households receiving Supplemental Social Security had 36.2 percent of households receiving Supplemental Social Security, while the highest tract for Social Security was  54.8.

The areas in which there was the overlap for the highest percentages of households receiving a certain income or benefit was in the Census tracts where for households receiving public cash assistance and food stamps. For example, there was a cluster of Census tracts along and to the east of Gratiot where up to 20.7 percent of households received cash assistance and up to 77.4 percent of households received food stamps. The data indicate that in 19 tracts between 60.4 and 77.4 percent of the households receive food stamps, and in over 80 tracts between 49.4 and 60.3 percent of residents receive food stamps. To be eligible for food stamps a family of four cannot earn more than $31,240 a year. In order to be eligible for public cash assistance an individual must have a child, have under $3,000 in cash assets and under $25,000 in property assets. The thresholds that households must meet to receive both types of these forms of government assistance, showcases how, particularly in the red colored Census tracts, incomes are among the lowest.

Overall, this post highlights how households in the City of Detroit rely on various forms of benefits and incomes. Clearly there are many retired households living on either retirement income or social security. These households are often, though not always in the same general neighborhoods. People that rely on food stamps and public assistance sometimes overlap with these neighborhoods, but they often concentrate in other areas. There are also areas—often including Downtown,  Midtown, East Jefferson and the far west neighborhoods–where far fewer households rely on any form of retirement income or public benefits.

 

 

Wayne County Home to Region’s Oldest Homes

The majority of Southeastern Michigan’s oldest homes are located in Wayne County, with six of the communities in the county having more of than 50 percent of the housing stock built prior to 1950. These communities are: Detroit, Highland Park, Hamtramck, Grosse Pointe Farms, Grosse Pointe Park and Wyandotte. Of those communities, and regionally, Grosse Point Park had the highest percentage of homes built before 1950 at 77 percent, followed by Hamtramck at 70.4 percent. In Detroit, about 58 percent of the city’s housing stock was built before 1950. Majority of the homes in Detroit built before 1950 are located in Southwest Detroit, with pockets near the Highland Park and Hamtramck borders, or the central area of the city. Conversely, the area long Belle Isle/the West Village and the most northwest corner of Detroit have the lowest percentage of homes built prior to 1950.

Regionally, about 22 percent of Southeastern Michigan’s housing stock was built prior to 1950. Looking a decade ahead, Census data shows that about 41 percent of the region’s housing stock was built before 1960. In examining this map below, we see that the communities with the highest percentage of homes built before 1960 mainly grew around the city of Detroit into the southern borders of Macomb and Oakland counties, and just east of Detroit. Southern Macomb County experienced some of the largest growth between 1950 and 1959, according to the Census Data. During that time frame Eastpointe grew its housing stock by 48 percent, bringing the total percentage of homes built prior to 1960 to about 78 percent. The City of St. Clair Shores grew its housing stock by 51 percent between 1950 and 1959; the total percentage of this city’s housing stock built prior to 1960 is 66 percent. In Oakland County, the City of Oak Park grew its housing stock by 51.2 percent between 1950 and 1959, growing the percentage of its housing stock built prior to 1960 to 67 percent.

While the inner-ring Detroit suburbs began to grow during this time, the peak percentage of homes being built after 1950 was for cities like Detroit, Hamtramck and Grosse Pointe Farms. For the city of Hamtramck, majority of its housing stock was built before 1939; the same is true for the city of Grosse Pointe Farms.

In Detroit, 22.9 percent of its housing stock was built between 1950 and 1959, making about 80 percent of its housing stock being built before 1960. The decade in which plurality of Detroit’s housing stock was built was between 1940 and 1949; about 24 percent of the housing stock was built during the 1940s.

As noted, the percentage of homes built outside the city of Detroit truly began to ramp up after 1950; the Detroit map below shows a similar trend was also occurring in the city. In the 1950 Detroit map above the Census data shows that majority of the housing built in Detroit prior to 1950 was located in the southwest portion area of the city and the more central area. The 1960 map shows that the percentage of housing built in Detroit between 1950 and 1959 largely grew in the northern and northwestern parts of the City.

This post highlights that Detroit and its inner-ring suburbs have a large stock of aging homes that will require investments and stronger laws to remain safe and habitable. One recent example of this is how the Detroit City Council approved updating its property maintenance code. This code amendment now requires landlords to remove lead hazards from homes that they rent. Such actions are particularly important because, because homes built prior 1978 are particularly susceptible to hazards related to lead-based paint given that a ban didn’t exist until then.

Lead Poisoning in Detroit, 2016

Lead poisoning has long been a serious problem for Detroit’s children, producing a lifetime of reduced cognitive capacity and many other consequences. In 1998, 17,015 Detroit children under 6 years old were lead poisoned at or above the 5 micrograms of lead per deciliter of blood (ug/dl) level. For over a decade lead poisoning has been declining yeay-by-year, but in 2016, the number rose by over 400 children to 2,073 (Figure 1). This was over 27 percent increase in one year (Figure 3).

It is likely that the proximal cause of this rise was an increase in testing of children. As shown below (Figure 2), testing had been declining in Detroit in recent years through 2015. In 2016, testing of children shot up by 9.5 percent (Figure 3). Over 2,000 more children were tested during this time. This was for two clear reasons. First, the Flint crisis surrounding lead in drinking water triggered more parents to have their children tested. Second, the City of Detroit, emerging from bankruptcy, was rebuilding its Health Department, and that agency began to actively test for lead and to encourage others to do so as well.

While, the percentage of children with lead poisoning has recently increased, the numbers are not evenly distributed across Detroit (Figure 4 below). Rather, children with lead poisoning are concentrated in zip codes where there are many older houses, mostly built well before the 1940s when lead paint was used frequently in homes. Second, these zip codes have low medium incomes (recall that poverty has increased in Detroit), and residents cannot afford to maintain their homes or landlords choose not to do so. Third, there are still many children in these zip codes.

So, many children are exposed to fraying homes where lead paint was heavily used historically. In one of these zip codes, 48214, preliminary data from a sample of over 500 homes indicates that as many as 87.9 percent of the homes assessed have some lead present on windows, walls, floors or porches. In this same zip code, tests show that about 17 percent of children have lead poisoning. The zip code with the highest percentage of children with lead poisoning is 48206 at 22.3 percent.

So, what can be done? Three important strategies are being executed by the City and others.

  • First, the Health Department attempts to case manage lead poisoned children, making sure that their home gets assessed and parents are trained to protect the child. Early intervention may reduce the long term effects of poisoning.
  • Second, where feasible, the homes of these children are referred for lead abatement, a procedure where lead hazards are removed from the home using public dollars, where the household cannot afford to pay. This can be very expensive, ranging from $5,000 to over $20,000. Still this costs a lot less than the lifetime cost of lead poisoning for a child.
  • Third, the City recently passed amendments to its property maintenance code that requires landlords to remove lead hazards from homes that they rent. In effect, this requires them to remove lead hazards. The City will be ramping this strategy up over the next few years, and this is expected to help the over 50 percent of Detroit residents who now rent.

Two more strategies are emerging as well:

  • First, ClearCorps and The Wayne State Center for Urban Studies are piloting an effort to identify homes with lead where children reside. Through this process an abatement of early lead hazards will take place, removing the hazard of a child being lead poisoned. The challenge for this approach is whether enough abatement funds and contractors to do the work can be made available for these homes.
  • Second, another possibility is to help families, who might choose to do so, to relocate to areas where homes have little or no lead paint. As Figure 4 above shows, several of the northern and western zip codes of Detroit have relatively low levels of lead poisoning of children. Figure 5, below, shows the percentage of tested children identified as lead poisoned for all of Wayne County. Figure 6 shows Oakland County. Figure 7 shows Macomb County. Many of these zip codes have no reported lead poisoning cases, but some of the housing may be prohibitively expensive for current Detroit residents.

Majority of Michigan’s Largest Woman Owned Businesses in Southeastern Michigan

The map below shows where Southeastern Michigan region’s largest women owned businesses in 2016 are located, according to data made available by Crain’s Detroit. The data set used for this post lists the top 40 women owned businesses in the State of Michigan, according to revenue; not all 40 were located in Southeastern Michigan. In total 15 of the state’s largest women owned businesses were located in Wayne County, 14 were located in Oakland County and five in Macomb County.

Of the businesses located in Southeastern Michigan, Ilitch Companies, based in Detroit, had the highest revenue in 2016 at an estimated $3.1 billion with about 6,200 employees. This business became principally controlled by a women, Marian Ilitch, in 2016 after the passing of Mike Ilitch. Detroit Manufacturing Systems LLC, located in Detroit came in second on the list with an estimated $1 billion earned in revenue in 2016 and about 1,040 employees, according to Crain’s Detroit.

 

The top five women businesses on the list were as follows:

  • Ilitch Companies (Detroit): $3.1 billion; 6,200 employees
  • Detroit Manufacturing: $1 billion (Detroit); 1,040 employees
  • Dakkota Integrated Systems LLC (Holt): $734 million; 836 employees
  • RKA Petroleum Co Inc (Romulus): $458 million; 796 employees
  • Strategic Staffing Solutions (Detroit): $350 million; 527 employees

While the map above highlights the largest women owned businesses in Southeastern Michigan, another report, according to a recent DailyDetroit.com, highlights how the entrepreneurial scene for women is also expanding in the region. According to the article, Detroit’s women owned businesses grew about 12 percent between 2006 and 2017. While such statistics can initially paint a rosy picture for the Southeastern Michigan business market, our last post shows there is still room for economic growth in the region.

Metro-Detroit Business Indicators Show Increase in Vacancies

This post focuses in on key business climate indicators in the Detroit Metro area. We examine retail rental rates, the changes in these rates, vacancy rates for both retail and industrial property, and employment by sector.

 

The two charts above describe the per square foot cost of retail rental space, and the change in that cost throughout the Detroit metropolitan region. In the first quarter of 2017 the City of Troy had the highest retail rental costs per square foot at $22.45, according to Marcus and Millichap. Troy also had a 10 percent increase from the first quarter of 2016. While the City of Troy did experience one of the larger retail rental cost increases over the last year, it was the Downriver area that experienced the largest increase. Between the first quarter of 2016 and the first quarter of 2017 there was a 14 percent rental cost increase in the Downriver area. By the first quarter of 2017 retail rental space cost $11.71 per square foot in Downriver; this was the lowest cost in the region.

Overall, the average retail rental cost per square foot in the Metro region was $12.94.

With retail rental costs the highest in the Troy area it is no surprise that that area in the region had the lowest vacancy rate at 2 percent during the first quarter of 2017, according to Marcus and Millichap. On the opposite side of the spectrum, Southfield had the highest retail vacancy rate at 12.1 percent; the cost of retail rental space per square foot in Southfield during the first quarter of 2017 was $13.39.

The overall retail space vacancy rate in the Metro region during the first quarter of 2017 was 6.8 percent.

Compared to retail space vacancies (6.8%), overall there were lower industrial vacancy rates (an average of just over 2%) throughout the region. The Royal Oak/Southfield area had the highest vacancy rate in the first quarter of 2017 at 5.5 percent while the Eastern section of the Metro region had the lowest rate at 1.7 percent, closely followed by the Troy area and Washtenaw. The highest industrial vacancies were in the Royal Oak-Southfield area.

In June of 2017, according to the data from the U.S. Postal Service, there were 7,932 total vacant business addresses in the City of Detroit; this number is a 324 vacancy increase from June of 2016. Overall, the business address vacancy rate in the City of Detroit was 27.5 percent in June of 2017; there were a total of 28,844 reported business addresses. The maps above show by Census Tract where the highest and lowest business address vacancies were by both number and percentage. In total, as shown in the first map, the Southwest Detroit region along the Detroit River had the highest number of business address vacancies. The Census Tract with the highest number of vacancies was located in that area; there were a reported 314 business vacancies in one Census Tract.

In addition to the Southwest Detroit cluster of high business address vacancies there was also a cluster just west of Highland Park and another cluster along M-53. While these clusters did not have as high of business vacancy numbers as Southwest Detroit, in several cases, Census Tracts in these clusters had higher percentages of business vacancy rates. For example, in a Census Tract just east of M-53, there was a business address vacancy rate of about 59 percent; this was the highest percentage in the City of Detroit in June of 2017.

Overall, this data shows that business vacancies are increasing overall in the City, but the higher percentage of vacancies tend to be located in business and industrial districts outside of Downtown Detroit.

According to information from the Bureau of Labor Statistics (BLS) , during the first quarter of 2017 Wayne County had the highest average weekly wages at $1,266 while St. Clair County had the lowest at $854.

The BLS does not include Washtenaw and Monroe counties in their Metro-Detroit Economic Summary updates, which is why they are not included in the chart above.

According to the BLS, the professional and business sector in the Metro-Detroit region had the highest number of employees at 408,800 while the information sector had the lowest number of employees at 28,300. The trade, transportation and utilities sector had the second highest number of employees at 367,700. The manufacturing industry had 249,400 employees, and the government sector had 173,900 employees.

Detroit Vacancy Rate Remains at 22 Percent

There were only 26 fewer vacant Detroit properties between June 2016 and June 2017, according to the U.S. Postal Service. This was a tiny decrease compared to the total number number of Detroit addresses of 396,416, but it was a decrease in vacancies. The vacancy rate in the City of Detroit remained just above 22 percent.

There were two other decreases that were probably more important. First, there was a substantial decrease in the total number of addresses, likely indicating that more vacant properties are now vacant lots. Overall, between June of 2017 and June 2016 the total number of addresses decreased by 5,388. By June of 2017 there were 396,416 total addresses counted by the U.S. Postal Service, and of these, there were 88,329 vacant addresses. Of the 396,416 total addresses, 353,140 were residential addresses and 80,296 of those were residential vacancies, meaning the residential vacancy rate was 22.7.

Second, although the decrease in the number of vacant addresses was small between June of 2016 and 2017, the decline in the number of “no stat” addresses was much larger; that number decreased by 3,515 in the last year. There is substantial ambiguity in that number, though it likely indicates some improvement in the housing market. Mail carriers denote properties as being either “vacant” or “no-stat.” Carriers on urban routes mark a property as vacant once no resident has collected mail for 90 days. Addresses are classified as “no-stat” for a variety of reasons. Addresses in rural areas that appear to be vacant for 90 days are labeled no-stat, as are addresses for properties that are still under construction. Urban addresses are labeled as no-stat when the carrier decides it is unlikely to be occupied again any time soon — meaning that both areas of high growth and severe decline may have no-stat addresses.

The maps below show the Detroit address vacancy rates by Census tract for June 2017 and the change in vacancy rates between June 2016 and June 2017. In total, there were about 65 Census Tracts in Detroit with total vacancy rates above 34 percent. The Census tract with the largest vacancy rate between June 2017 and June 2016 was located in a pocket of Census tracts along I-96 where the vacancy rates did not drop below 38 percent. The vacancy rate for this Census tract 54.3 percent. When looking at the second map the data shows that the largest vacancy rate increase for a Census tract was located in Southwest Detroit; the vacancy rate increase for that Census tract was 8.4 percent. The map also shows the largest vacancy rate increases were primarily concentrated in an area just east of Hamtramck and on the western side of the city near I-96.

Overall, the story this data shows is that the number of homes in the City is decreasing, and the number of vacant homes is slightly decreasing, though the exact number is ambiguous, given the uncertainty surrounding “no-stat” numbers. The decline in “no-stat” numbers is, however, consistent with recent population estimates. According the U.S. Census Bureau, between 2015 and 2016 the City of Detroit has lost about 3,541 residents; its population in 2016 was reported to be 672,795.

Poverty, Labor Force Participation Moderately Correlated in Southeastern Michigan

As discussed throughout our most recent series, data about labor force participation highlights decreasing percentage of individuals who are not active participants in the work force. To further explore the recent labor force and poverty rate discussions, this post delves into the correlation between the 2015 labor force participation rate and the 2015 poverty levels across the Southeastern Michigan area.

A correlation is statistical technique that can be used to describe the relationship between two variables. The correlation coefficient, often expressed as ‘r’, is a numerical value that is always between +1 and -1. When r is closer to +1, it implies a positive correlation; as one variable increases, the other does as well. When r is closer to -1, it implies an inverse correlation; as one variable increases the other decreases. When the value of r is closer to 0 the implication is that there is no relationship between the two sets of data.

Looking across the region we find that labor force participation with poverty at a level of -0.46, a moderate correlation. (Note that we are using municipalities as the unit of analysis here.) This correlation tends to indicate that as labor force participation declines, poverty increases, all other factors being equal. This helps to explain why we are seeing increasing poverty in areas, including many suburban areas, where labor force participation was hit hard by the Great Recession.

 

We also examined the variation in this correlation across the counties in the region.

 

Correlation Coefficients for Southeastern Michigan Counties: Labor Force Participation and Poverty

  • Livingston County: -.4
  • Macomb County: -.24
  • Monroe County: -.18
  • Oakland County: -.28
  • St. Clair County: -.18
  • Washtenaw County: .08
  • Wayne County: -.84

These results present correlations calculated across municipalities within counties. We found that, aside from Washtenaw County, every other county in Southeastern Michigan had a negative correlation, meaning that as labor force participation declined, poverty increased. Of those six counties, Wayne County was the only one to have a strong negative correlation—(-0.84). This implies that municipalities in Wayne County with lower labor participation are very likely to have higher levels of poverty.

 

The correlations for five other counties–Macomb, Livingston, St. Clair, Monroe and Oakland–were negative but weak or moderate, meaning that there was still a tendency for poverty to increase with a lower labor participation rate, but it was weaker.

 

Washtenaw County was the only county in the region to have a correlation coefficient above 0, the value being +0.08, indicating a very low positive association between poverty and labor force participation.

 

Overall, these analyses show that six of the seven counties had weak to moderate correlation between their labor participation rates and their adult poverty rates. Wayne County was the exception to this, with a strong correlation coefficient of -0.84. Previous posts have shown that Wayne County communities also experienced some of the largest decreases in its labor force participation rates since 2010 and had some of the highest overall adult poverty rates. For example, in 2015 Highland Park had the lowest adult labor force participation at 54 percent, while the poverty rate is 49.3 percent.

 

In the suburbs, particularly those located nearer to Detroit (with some notable exceptions), there have been overall declines in labor force participation rates. At the same time data clearly shows that the percentage of adults in poverty has been increasing for many of the suburbs in Southeastern Michigan in recent years.