Poverty went down and incomes rose last year in Detroit, the first significant income increase recorded by the U.S. Census Bureau in the city since the 2000 census.
Detroiters’ median household income was $28,099 in 2016, a 7.5 percent hike from the previous year, according to U.S. Census’ American Community Survey estimates released Thursday. And poverty dipped, by 4 percentage points to 35.7 percent. It’s the lowest poverty rate for the city since 2008.
Mayor Mike Duggan touted the economic gains, coming three years after the city’s historic bankruptcy, as proof his focus on adding jobs and providing training is paying off. Experts welcomed the numbers as well, but cautioned not to read too much into a one-year gain.
Detroit remains the poorest big city in the nation, just above Cleveland, where the poverty rate was 35 percent.
And a deeper look at the income data suggests the incomes of Hispanic and white Detroit residents grew significantly more than blacks, who make up 79 percent of the city, said Kurt Metzger, a demographer and director emeritus of Data Driven Detroit.
“Overall it’s a great story for Detroit,” Metzger said. “But when you look beneath the surface, we still have a lot of issues. There is a constant narrative out there: Are all boats rising together?”
Duggan said he knows they have more work to do, but promised more gains are ahead.
Forty-four people graduated last month from the Detroit At Work job training program, which launched in February and half already received job offers, according to the city. Auto supplier Flex-N-Gate Corp. is expected to bring an estimated 500 jobs to Detroit when it opens in the I-94 industrial park in 2018.
“Income goes up when one, there is a job opportunity and two, when you have the skills to take advantage of it,” Duggan told The Detroit News. “As we raise the skills of our residents we will raise the standard of living.”
“Nobody is celebrating a (35.7) percent poverty rate, but the progress is important and it took us years to get here.”
Explore the database:Poverty and income statistics for counties and communities over 65,000 in Michigan.
There were economic gains at the state level in Thursday’s release as well, with Michigan seeing its fourth straight year of income growth. But the increases weren’t enough to put residents’ incomes on par with what they were making before the Great Recession.
The state’s median household income in 2016 was $52,492, a 1.8 percent boost from the previous year. That’s still 6.5 percent lower than what residents were earning in 2007 — $56,123 adjusted for inflation.
And Michigan’s gains were smaller than improvements in income nationally and in the Midwest. The national median income was $57,617 last year, a gain of 2.4 percent, and $55,712 in the Midwest, a 2 percent increase, according to the survey.
Poverty dropped in Michigan to 15 percent, a .8 percent point decrease. In comparison, nationally the poverty rate was 14 percent last year, a 0.7 percentage point drop, and 13.2 percent in the Midwest, a 0.6 percentage point drop. The poverty line for a family of four is an income below $24,563.
Fewer kids in Detroit are living in poverty, according to the new numbers. The poverty rate among residents under 18 years old dropped 7 percentage points to 50.8. That’s the lowest rate since 2009.
Detroit’s income is up likely because more residents are working, said Xuan Liu, manager of research and data analysis for the Southeast Michigan Council of Governments. He cited the census data released Thursday showing the unemployment rate in the city decreased from 20.6 percent to 16.5 percent in one year.
“Eight years after Great Recession, (census) data is finally show some significant economic benefits for more Detroiters,” Liu said.
Median household income in Detroit has dropped or remained stagnant since the 2000 Census, when adjusting for inflation.
But Detroit’s 2016 median income remains 14.6 percent lower than what residents were earning in 2007 — $32,886 adjusted for inflation.
While the new census figures show some economic improvements in Detroit, a recent report reveals a disparity between downtown and city neighborhoods.
According to the Washington D.C.-based Urban Institute, tax subsidies and investments are disproportionately favoring downtown and Midtown. The report says there has been more limited investment in outer neighborhoods. Between 2003-14, most of the job growth was along Detroit River, Central Businesses District and Lower Woodward Corridor, the Urban Institute says.
Metzger also said Thursday’s census data shows Detroit has more work to do so that all residents benefit from the rebound.
The 2016 income data shows the gains were seen by Hispanic and white residents, although the survey data for whites was just within the margin of error, he said. The income rise wasn’t statistically significant for blacks, Metzger said.
“The people who are ready and able to take advantage of the turnaround are doing it but those who aren’t, haven’t,” Metzger said.
The American Community Survey collects data from a sample of the population and issues overall estimates based on their calculations.
Detroit’s Workforce Development Board has set a goal to get 40,000 more residents employed in the next five years, said Jeff Donofrio, the group’s executive director.
Romona Irvin, 61, recently took advantage of skills training offered by the city through Detroit At Work and now has a job as a patient care technician at St. John Providence.
“People might lack initiative to do something because they feel they don’t have the money to (get jobs skills training),” Irvin said.
And Ciara Williams, 27, of Detroit, who started this week working as a teacher’s aide in Detroit, said she sees more jobs opening, but the wages are still low and full-time positions are rare.
“Most of the jobs farther out (in the suburbs) pay better,” said Williams, a mom of two and a musician in her spare time. “People pray for 30 or more hours in Detroit.”
Regional incomes rise
The census release included a variety of other data for cities with more than 65,000 population, including race.
Detroit’s white population — 10.2 percent — was statistically unchanged for the second year in a row, according to estimates. The change from 2013 to 2014 — a 1.3 percentage point jump — was the first significant increase of the city’s white population since 1950.
In May census data showed Detroit’s population loss had slowed to its lowest pace in decades, 672,795 as of last summer, a loss of 3,541 residents.
The Metro Detroit region saw median household income rise by 3.5 percent to $56,142.
Flint saw no change in poverty or income and remains the poorest city in the country above all cities with 65,000 or more residents. Flint’s poverty rate was 44.5 percent in 2016 and the median household income was $25,896.
Macomb County’s median household income rose by 9 percent to $60,143.
County Executive Mark Hackel said he believes residents are earning more income because more residents are getting college degrees. Hackel cited Macomb Community College’s partnerships with universities that allow students to earn a bachelor’s degree there. The data shows 16.7 percent of county residents had a bachelor’s degree in 2016, an increase of 1.6 percentage points from last year.
But others area counties’ median income stayed the same. Livingston remained the wealthiest large county in the state, with a median household income of $78,038, compared to $71,920 in Oakland and $43,464 in Wayne.
Experts caution not to pay too much attention to large year-to-year changes in smaller cities. Last year, Shelby Township saw median household incomes rise 22 percent to $72,525. But in 2015, incomes dropped 14.7 percent.