Richard Florida Concedes the Limits of the Creative Class


Among the most pervasive, and arguably pernicious, notions of the past decade has been that the “creative class” of the skilled, educated and hip would remake and revive American cities. The idea, packaged and peddled by consultant Richard Florida, had been that unlike spending public money to court Wall Street fat cats, corporate executives or other traditional elites, paying to appeal to the creative would truly trickle down, generating a widespread urban revival.

Urbanists, journalists, and academics—not to mention big-city developers— were easily persuaded that shelling out to court “the hip and cool” would benefit everyone else, too. And Florida himself has prospered through books, articles, lectures, and university positions that have helped promote his ideas and brand and grow his Creative Class Group’s impressive client list, which in addition to big corporations and developers has included cities as diverse as Detroit and El Paso, Cleveland and Seattle.

Well, oops.

Florida himself, in his role as an editor at The Atlantic, admitted last month what his critics, including myself, have said for a decade: that the benefits of appealing to the creative class accrue largely to its members—and do little to make anyone else any better off. The rewards of the “creative class” strategy, he notes, “flow disproportionately to more highly-skilled knowledge, professional and creative workers,” since the wage increases that blue-collar and lower-skilled workers see “disappear when their higher housing costs are taken into account.” His reasonable and fairly brave, if belated, takeaway: “On close inspection, talent clustering provides little in the way of trickle-down benefits.”

One group certain to be flustered by this new perspective will be many of the cities who have signed up and spent hard cash over the years to follow Florida’s prescription of focusing on those things—encouraging the arts and entertainment, building bike paths, welcoming minorities and gays—that would attract young college-educated workers. In his thesis, the model cities of the future are precisely those, such as San Francisco and Seattle, that have become hubs of highly educated migrants, technology, and high-end business services.

That plan, though, has been less than successful in many of the old rust belt cities that once made up much of his client base. Perhaps even more galling to these cities, Florida has turned decidedly negative in his outlook on many of those cities—now looking remarkably gullible—that once made up much of his client base.

The most risible example of this may have been former Michigan Jennifer Granholm’s “cool cities” campaign of the mid-oughts, that sought to cultivate the “creative class” by subsidizing the arts in Detroit and across the state. It didn’t exactly work. “You can put mag wheels on a Gremlin,” comments one long-time Michigan observer. “but that doesn't make it a Mustang.”

Alec MacGillis, writing at The American Prospect in 2009, noted that after collecting large fees from down-at-the-heels burgs like Cleveland, Toledo, Hartford, Rochester, and Elmira, New York over the years, Florida himself asserted that we can’t “stop the decline of some places” and urged the country to focus instead on his high-ranked “creative” enclaves. “So, got that, Rust Belt denizens?” MacGillis noted wryly in a follow-up story last year at the New Republic. Pack your bags for Boulder and Raleigh-Durham and Fairfax County. Oh, and thanks again for the check.”

One key constituency advocating “creative class” oriented development has been the grandees of urban real estate. Albert Ratner of Cleveland-based Forest City Enterprises, a major urban developer with a taste for subsidies, in New York and elsewhere, suggests Florida’s ideas provides the “playbook for developers.”

For Rust Belt cities, notes Cleveland’s Richey Piiparinen, following the “creative class” meme has not only meant wasted money, but wasted effort and misdirection. Burning money trying to become “cooler” ends up looking something like the metropolitan equivalent to a midlife crisis.

It would have been far more sensible, Piiparinen suggests, for such areas to emphasize their intrinsic advantages, such as affordable housing, a deep historic legacy tied to a concentration of specific skills as well as a strategic location. He urges them to cultivate their essentially Rust-Belt authenticity rather than chase standard issue coolness promoted by big developers like Forest City. Focusing on attracting the “hip cool” single set, Piiparinen maintains, simply sets places like Cleveland up for failure.

Geography of Hip Coolness

Perhaps the best that can be said about the creative-class idea is that it follows a real, if overhyped, phenomenon: the movement of young, largely single, childless and sometimes gay people into urban neighborhoods. This Soho-ization—the transformation of older, often industrial urban areas into hip enclaves—is evident in scores of cities. It can legitimately can be credited for boosting real estate values from Williamsburg, Brooklyn, Wicker Park in Chicago and Belltown in Seattle to Portland’s Pearl District as well as much of San Francisco.

Yet this footprint of such “cool” districts that appeal to largely childless, young urbanistas in the core is far smaller in most cities than commonly reported. Between 2000 and 2010, notes demographer Wendell Cox, the urban core areas of the 51 largest metropolitan areas—within two miles of the city’s center—added a total of 206,000 residents. But the surrounding rings, between two and five miles from the core, actually lost 272,000. In contrast to those small gains and losses, the suburban areas—between 10 and 20 miles from the center —experienced a growth of roughly 15 million people.

The smallness of the potentially “hip” core is particularly pronounced in Rust Belt cities such as Cleveland and St. Louis, where these core districts are rarely home to more than 1 or 2 percent of the city’s shrinking population. Yet the subsidy money for developers is often justified in the name of “reviving” the entire city, most of which has continued to deteriorate.

Nor has this dynamic changed since the onset of the Great Recession, as urban boosters such as Aaron Ehrenhalt have suggested. Ehrenhalt, citing the perceived preferences of millennials, envisions an urban future where more reject the suburban life, in part as a reaction to the wreckage of the last housing bust. To Ehrenhalt, places like downtown Chicago are emerging as the modern-day version of early-20th-century Vienna, central cores that attracted the elites while the working class and middle class dullards regress to the suburbs. Yet in reality, an examination of data between 2011 and 2012 by Jed Kolko at Trulia found despite a spike in downtown residents, population losses continue in surrounding close-in urban neighborhoods, while the fastest growth has continued to be located further out in the periphery.

Class Politics in the “Creative Age”

Investments in “cool” districts may well appeal to some young professionals, particularly before they get married and have children. But overall, as Florida himself now admits, it has done little overall for the urban middle class, much less the working class or the poor.

Indeed in many ways the Floridian focus on industries like entertainment, software, and social media creates a distorted set of economic priorities. The creatives, after all, generally don’t work in factories or warehouses. So why assist these industries? Instead the trend is to declare good-paying blue collar professions a product of the past. If you can’t find work in deindustrialized Michigan, suggests Salon’s Ray Fisman, one can collect “ more than a few crumbs” by joining the service class and serving food, cutting hair or grass in creative capitals like San Francisco or Austin.

These limitations of the “hip cool” strategy to drive broad-based economic growth have been evident for years. Conservative critics, such as the Manhattan Institute’s Steve Malanga have pointed out that many creative-class havens often underperform economically compared to their less hip counterparts. More liberal academic analysts have denounced the idea as “ exacerbating inequality and exclusion.” One particularly sharp critic, the University of British Columbia’s Jamie Peck see it as little more than a neo-liberal recipe of “biscotti and circuses.”

Urban thinker Aaron Renn puts it in political terms: “the creative class doesn’t have much in the way of coattails.”

Why Hipness Can’t Save New York

The sad truth is that even in the more plausible “creative class” cities such as New York and San Francisco, the emphasis on “hip cool” and high-end service industries has corresponded with a decline in their middle class and a growing gap between rich and poor. Washington D.C. and San Francisco, perennial poster children for “cool cities,” also have among the highest percentages of poverty of any major urban center—roughly 20 percent—once cost of living is figured in.

Nowhere are the limitations of coolness more evident than in New York, our country’s cultural capital and now one of Florida’s three residences, along with Toronto and Miami Beach. Manhattan suffers by far the highest level of inequality among the country’s 25 most populous counties, a gap between rich and poor that’s the widest it’s been in a decade. New York’s wealthiest one percent earns a third of the entire city’s personal income—almost twice the proportion for the rest of the country.

This geography of inequality is now extending to the outer boroughs. In nouveau hipster and increasingly expensive Brooklyn, nearly a quarter of people live below the poverty line. While artisanal cheese shops and bars that double as flower shops serve the hipsters, one in four Brooklynites receives food stamps. New York has seen the nation’s biggest rise in homelessness; the number of children sleeping in the shelters of Mike Bloomberg’s “luxury city” has risen 22 percent in the past year.

The Issue of Race

On paper, the “creative class” theory worships at the altar of diversity. “The great thing about cities,” Florida told NPR last year, “is they're diverse. There's diverse people in them.” Yet even leaving aside their lack of economic diversity, the exemplars of “hip cool” world, notes urban analyst Renn, tend to be vanilla cities with relatively small minority populations. San Francisco, Portland and Seattle are becoming whiter and less ethnically diverse as the rest of the country, and particularly the suburbs, rapidly diversify.

Creatives may espouse politically correct views, but the effect of Florida’s policy approach, notes Tulane sociologist Richard Campanella, often undermine ethnic communities. As they enter the city, creatives push up rents, displacing local stores and residents. In his own neighborhood of Bywater, in New Orleans, the black population declined by 64 percent between 2000 and 2010, while the white population increased by 22 percent.

In the process, Campanella notes, much of what made the neighborhood unique has been lost as the creatives replace the local culture with the increasingly predictable, and portable, “hip cool” trendy restaurants, offering beet-filled ravioli instead of fried okra, and organic markets. The “unique” amenities you find now, even in New Orleans, he reports, are much what you’d expect in any other hipster paradise, be it Portland, Seattle, Burlington, Vermont or Williamsburg.

Families and the Future

Campanella also suggests another byproduct of hipster gentrification: a dearth of families. Ten years ago his increasingly “creative class” neighborhood of Bywater was family oriented. Now, it’s “a kiddie wilderness.” In 2000, 968 youngsters lived in the district. Just 10 years later, the number had dropped by 70 percent, to 285. When his son was born in 2012, it was the first post-Katrina birth on his street, the sole child on a block that had 11 when he first arrived from Mississippi in 2000.

Unsurprisingly, there’s not much emphasis about families in Florida’s work, in part because his basic theory puts focuses largely on groups like singles, childless young professionals and gays. He largely discounts suburbs, generally the nation’s nurseries, as outdated for the “creative age” and considers homeownership and single family houses, also vastly preferred by families, as fundamentally passé.

Indeed, the places that most attract “the creative class” are also the ones with the fewest families and children, led by San Francisco, Seattle, Manhattan, and rapidly gentrifying Washington, D.C. The very high prices per square foot, understandably celebrated by urban real estate boosters, have made it hard not only on the poor but on middle- and even upper-middle-class families. When you have children, you often have to let go of your bohemian fantasies; it’s hard to imagine being a parent in a place like San Francisco where there are a raging debates about the right of people to walk around naked.

The Real Geography of Opportunity

To be sure, the leading “creative class” cities have much to recommend them, and some of them, such as Portland and Boston, have registered impressive rises in their per capita income in recent years. But over the past decade, most “cool cities” have not been enjoying particularly strong employment or population growth; in the last decade, the populations of cities like Charlotte, Houston, Atlanta, and Nashville grew by 20 percent or more, at least four times as rapidly as New York, Los Angeles, San Francisco, or Chicago. This trend toward less dense, more affordable cities is as evident in the most recent census numbers than a decade.

One reason for this: the fastest job growth has taken place in regions—Houston, Dallas, Oklahoma City, Omaha—whose economies are based not on “creative” industries but on less fashionable pursuits such as oil and gas, agriculture and manufacturing. Energy mecca Houston, for example, last year enjoyed the largest GDP growth of any major American city, easily outpacing “creative” urbanist favorites like Chicago, New York, San Francisco, or Boston. The other two top GDP gainers were Dallas-Fort Worth and, surprisingly, Detroit, largely as a result of the auto industry’s comeback.

Of course, some these ascendant cities now are sprouting their own “hip” neighborhoods. But these regions also accommodate far faster growth in rapidly expanding, family-friendly suburbs and exurbs. Equally important, none, including “creative class” hotspots Raleigh and Austin, are dense, transit-centered places of the kind urbanists suggest create economic vibrancy and attract the largest number of migrations.

In fact both Raleigh and Austin are both very low-density regions with only compact urban pockets surrounded by vast suburban communities. Take a walk in downtown Raleigh sometime; about five minutes from the densest central areas and you find yourself on tree-lined streets with nice single-family houses, essentially, older suburbs. Austin, too, is a relatively low-density place surrounded by the kind of suburban sprawl detested by Floridians; this is also the case with Charlotte, Atlanta, and other fast-growing cities.

These facts, of course, are unlikely to interfere with the self-interested lobbying by large developers for subsidies for downtown development much less the defined prejudices of the urban-centric media. But contrary to the narrative espoused by Florida and other proponents of high-density cities, the predominant future urban form in America is emerging  (largely unrecognized to the media) elsewhere, in places less dense, economically diverse and, perhaps, just a bit less hip and cool.

Joel Kotkin is executive editor of and a distinguished presidential fellow in urban futures at Chapman University, and a member of the editorial board of the Orange County Register. He is author of The City: A Global History and The Next Hundred Million: America in 2050. His most recent study, The Rise of Postfamilialism, has been widely discussed and distributed internationally. He lives in Los Angeles, CA.

This piece originally appeared in the The Daily Beast.

Seattle photo by Bigstock.

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Mobile and educated

A few comments on your response.
1) The discussion of population movement, business site selection, etc is not simply a choice between large urban center like London, New York and cheaper smaller cities. It is also a choice between comparable areas as well.
2) Richard Florida and others like him mistake the direction of variables. He long argued that if you create the arts that jobs and people will follow whereas as it has long been the case that once jobs and people are established the arts begin to flourish.
3) you comment that education is mobile. This is true and we have seen this in the past 20 years as educated people have relocated to the sun belt. However, there is a diffrence between short run demographic stability snd long run demographic stability. But the short run cost arbitrage is not a long run solution for stability. We see this in manufacturing in Asia and some US regions as costs are driven up by population movement. Long run planning is essential and education is a key variable.. Why is Austin still expanding even as it's cost of living far exceeds Charleston, West Virginia? Why don't we see a shift to West Virginia if costs are the only factor? Why is Salt Lake City capturing business investment at a multiple much higher than Boise when Boise is cheaper? Companies in Boise like Micron have operations in Salt Lake because it is easier to attract local engineering graduates who are better qualified than they are in Idaho.

Of all the "costs", economic land rent is the decider

Excellent comments. I absolutely agree with 2)

My own central point is the explanation for the other points you are making; I think we can agree on this. No-one can predict the way a city is going to evolve over the next century. The famous urban economist Colin Clark liked a traditional saying: "the owl of Minerva (wisdom) flies at dusk". That is, we tend to understand a paradigm only as the sun is setting on it anyway.

Ed Glaeser does a good job of explaining, in "Triumph of the City", how successful urban-economic agglomerations like Manhattan and Silicon Valley came about. But no-one 100 years ago, had a clue how what they were doing back then, was going to be part of an evolutionary process towards something they could not possibly have even envisaged.

Urban planners now are tending to engage in a kind of race to the bottom to belatedly "attract" sectors that arose somewhere else for reasons that urban planners might not even understand. Meanwhile, some cities somewhere that "get the basics right" and don't "plan" so heavily that they are an obstacle to new things happening, will possibly be the new waves of success in another century or so.

Silicon Valley could never have happened in the UK because their urban planning system never allows haphazard "industrial" growth on rural land at prices that young entrepreneurs can afford.

You say ".... the short run cost arbitrage is not a long run solution for stability. We see this in manufacturing in Asia and some US regions as costs are driven up by population movement....."

I think I agree. But the parts of the USA that Joel Kotkin calls "America's Growth Corridors" overwhelmingly have regulatory structures re urban growth, that allows for LONG RUN restraint of all costs related to "economic rent". It is "economic rent" that is making costs SO high in the places you refer to. It is a massive advantage when a city manages to keep the ratio between its "total land value" and "total income" low and stable.

The UK's cities are a cautionary object lesson in the maximisation of economic rent via heavy handed "planning". Cheshire and Mills (1999) suggest that office rents per square foot in London might be as much as 100,000 times higher than they could be with market freedom in urban development, in fringe growth, "building up", and in redevelopment of land to more appropriate uses. Cheshire and Hilber analyse this in more depth in a later paper entitled something like "The Political Economy of Market Revenge: the Case of Office Rents". They find that every city in the UK, no matter how economically moribund, has higher CBD office rents per square foot than Manhattan, which is the highest in the USA.

Of course the land owning rentier class in the UK has reaped a massively disproportionate share of total income growth, at the expense of the productive, "tradables" sector.

Economic land rent in China is at ridiculous levels and this has to cause their economic miracle to hit the same limits as Japan's, for the same reason.

Cities like Austin and Salt Lake City, while they are more costly than Charleston and Boise, are still great examples of cities where economic land rent is not high, and the ratio of total land value to total income is still very competitive. They are not just attracting growth "instead of Charleston and Boise" because of better educated workforces, they are attracting growth instead of Silicon Valley and LA and San Fran now that those places are very expensive. And it is even likely they are attracting business from the UK, Europe, and Asia.

As long as Austin and SLC do not adopt planning policies that maximise economic rent, but maximise productivity and income growth, there is no reason that their cost-competitiveness needs to remain only a "short run" advantage. Economic rent is straight out zero-sum or even negative sum wealth transfer. It is far more significant, everywhere that it is a problem, than "the cost of infrastructure" regardless of urban form.

When I say strong local education

Which I did not.
I said improve the schools.
Crappy schools are the #1 reason people move out of the city.
What if you had a city whose schools were better than the suburbs?

Don't make "means", an end in themselves.

The best thing for education is competition. It doesn't matter if parents move to where schools are better, as long as their children are getting a good education. That is what we want: children to have a better education. If better schools emerge somewhere and parents move to get their children into it, that is an acceptable way of lifting educational standards.

If an area experiences falling pupil numbers, the land the schools located there are on, can be put to better use. Churn and creative destruction is good for the economy. Schools are one of the things that are land-intensive, that suburbs with lower land costs are far better suited to.

And there are plenty of other uses for land in cities, that will help that city forward. Having families bringing up children is not essential. Just get the children once they are educated, moving into condos in the city and working at jobs in the city. Make this attractive. We live in an age where mobility and flexibility is an assett, and trying to restore the past is misguided.

Every city is different and there will be reasons besides failing schools, that cause people to move out of many of them. "Schools" is only the factor for parents with children, in cities that have not yet fully gentrified. Once a city has fully gentrified, the reason for the same people to move somewhere else, is "the cost of housing". Eg Manhattan. If you can afford enough space for a family there, you can afford a private tutor for your children.

"Trickle down urban economics" does work in LOW-land-cost cities

Ryan Avent spotted some very interesting correlations recently:

(Note the links to other items too).

Bottom line: when housing and urban land is more expensive, even tech industries growth is constrained, and the "trickle down" spin-off lower-paying jobs from tech industries are far less. Every tech industry that opens in Texas or NC creates several times as many such jobs as a new one in Silicon Valley.

William Fruth has long been a kind of "Anti-Florida"

".....the fastest job growth has taken place in regions—Houston, Dallas, Oklahoma City, Omaha—whose economies are based not on “creative” industries but on less fashionable pursuits such as oil and gas, agriculture and manufacturing...."

Exactly what William Fruth has long been advising every city that would listen to him. Get the basics right. It is these that actually provide the flow of inbound income into the local economy, to most cities most of the time.

William Fruth has long been a kind of "Anti-Florida". He is the guy that cities SHOULD have been hiring to give them advice: read this:

Diversity Diverted?

Joel -

An article on the SiliconBeat site today speaks to the lack of diversity among some of our most highly recongized tech companies.

Of course there is not a one-to-one correlation between these companies and the creative class but these companies employ relative few women, blacks and Latinos. I won't go so far to call them hypocrites, as the SilconBeat article implies, because they must seek the skilled people that they need. Instead, as Dave notes in a previous comment, access to education and skills training is the key.

Not all creatives are created equal....

Excellent article. Using the City of Portland as an example, I would also like to highlight that not only do the "creatives" not have coattails, but within the creative demographic itself there are limitations to earning power. In Portland, for example, many of the young creatives flocking to the city are not graduating with degrees that make them productive knowledge workers, rather they are armed with humanities and fine arts degrees for which there is limited demand in a competitive employment market and it is reflected in depressed wages. Said another way, Portland attracts those seeking lifestyle, rather than the ambitious, which is fine on its own merits, but it should not be confused with strong economic growth, which is the Richard Florida thesis. (Note that this is an aggregate observation and a generalization, there are of course individual and specific examples that are contrary to this). Reference a recent article in Oregon Live, the online version the the Oregonian.

The focus on non-family oriented urbanites by the urban planning experts and the economic development agencies further exacerbates this dilemma. When you have a building code that allows you to build apartments without parking spaces, but mandates that you have bicycle storage you have created a public policy that explicitly discourages families and encourages the in migration of less productive citizens, in terms of earning potential.

I am confused

You have confused me.
You seem to have conflated Florida's creative class espousal and lobbying by large developers.
I live in a part of Denver that is gentrifying rapidly and there are almost zero large developers. It is mostly small in-fill developers.

Personally, I think the #1 for cities to improve are the schools.