There has been growing economic distress in America, which is making people question their future. President Biden also talked about the importance of staying steady and continuing to create jobs to address this economic distress.
Growing Economic Distress in America
The economic distress in America right now is caused by its states, cities, and towns. According to the Economic Innovation Group’s data, many local economies in the US did not fully recover from the COVID-19 pandemic by 2023.
EIG categorizes areas by economic health using US Census Bureau data. About 52 million Americans live in a “distressed” zip code, an increase from 50 million in 2018. These scores consider factors like education, poverty, employment, housing, income, and business changes.
EIG found that the economic distress in America is greater in urban areas, while suburbs are seen as more prosperous. For instance, nearly every city zip code in Cleveland is distressed, while many suburbs are thriving.
Post-pandemic Growth in America
Typically, an area’s economic health is joined to its population size, and during the pandemic, population shifts occurred nationwide.
Big urban counties, previously defined by EIG as those overlapping with an urban area of 250,000 people or more, suffered huge losses because of the pandemic. From July 1, 2020, to July 1, 2021, these counties lost 812,000 residents.
The report shows that exurban and suburban counties continued to grow in 2022. This growth is due to significant domestic migration during the early pandemic period. After gaining 931,000 people in 2021, these counties added another 832,000 residents in 2022.
Benzow said that the pandemic has clearly increased this trend, as people can now live farther from cities and still work remotely or in a hybrid setup.
Goldman Sachs said that many people have moved from big cities, with about half relocating to metro counties with populations ranging from 250,000 to 1 million. After the post-pandemic growth in America, this demographic has changed. This has been usually due to concerns over the virus and remote work options. This has been present since the pandemic’s start and has continued through mid-2023.
The pandemic showed huge wealth gaps as those with financial resources moved from cities to suburbs, leaving lower-income urban residents behind.
For example, Fort Worth, Texas, the 13th largest US city, saw 4.1% population growth (nearly 1 million residents) from 2020 to 2023. However, about 32.2% of these residents live in economically distressed areas, compared to 29.2% in prosperous ones.
America’s urban core faces more economic distress than the comfortable and prosperous suburbs.
Fort Worth Mayor Mattie Parker said people are looking for places with quality living and opportunities. She added that much of the domestic migration into places like Fort Worth is due to that.
However, the increase in housing demand led to an 11.5% increase in median property value from 2020 to 202, worsening the housing affordability concerns.
Parker discussed the challenge of providing mixed-income and middle-income housing in cities. She said that while there is a focus on low-income housing, middle-income housing is often overlooked.
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