About 25 percent of households in the nation’s 100 largest cities are in the lowest income rung, according to a study by The Brookings Institution, while about 17 percent of big-city households are in the top income bracket. The study compares household income distribution in U.S. cities from 1979-99, and adjusts income for regional cost-of-living differences.
The 100 largest cities exhibit six basic household income distribution patterns. Only 13 balanced cities such as Indianapolis mirror the nation’s income distribution. Similarly, in just a handful of divided cities, including Washington, D.C., does the number of households at the extremes of the distribution exceed that in the middle. Wealthy households predominate in a few large, suburban-like higher-end cities such as Scottsdale. A larger set of middle-class cities like Colorado Springs have most of their households in the central portions of the distribution. Finally, in low-moderate cities like Memphis, the number of households declines as one moves up the income ladder, but not as steeply as in stressed cities like Cleveland, where households near the bottom outnumber those near the top by at least two to one.
The proportion of households with high incomes declined in 79 of the 100 largest cities between 1979 and 1999. Struggling cities in the Northeast and Rust Belt lost high-income households more rapidly than other income groups over the 20-year period, contributing to a proliferation of stressed cities. Meanwhile, the middle-income segment shrank in some of the largest cities even as it grew rapidly in mid-sized cities such as Grand Rapids, Tacoma, and St. Petersburg. Overall, the number of middle-class cities grew from just 13 in 1979 to 29 in 1999, according to the study.
Suburbs’ income distribution inverts cities’ income distribution, as more than 25 percent of suburban households comprise the top 20 percent in terms of income. Yet the suburbs of the 100 largest cities contain a greater mix of households by income today than in 1979 and the relative numbers of high-income households in suburbs declined, while those of low-income and lower-middle-income households rose.
Middle-class households did not abandon all cities over the past 20 years. Still, the majority of cities lack the nation’s broad spectrum of incomes. Because a balanced income profile can create better social, fiscal, and political outcomes for places, cities should aim to attract and retain the particular types of households that would contribute to greater income diversity.
Plano, Texas; Fremont, Calif.; Scottsdale, Ariz.; San Jose, Calif.; and Anchorage, Alaska; have the largest share of high-income households, when adjusted for regional cost-of-living differences, according to the study. In Plano, about 45.6 percent of households are high-income. Aurora, Colo.; Virginia Beach, Va.; Irving, Texas; Santa Ana, Calif.; Mesa, Ariz.; and Fort Wayne, Ind., have the highest share of middle-income households. About 24.4 percent of households in Aurora are middle-income.
And Miami, Fla.; Newark, N.J.; Buffalo, N.Y.; Cleveland, Ohio; and Rochester, N.Y., have the largest share of low-income households. About 42.6 percent of households in Miami are low-income, the study states.
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