Chicago, Portland: Employment Dispersion from Downtown Continues

Wendell Cox — Tue, 01 Mar 2011 15:10:02 -0500

New data shows that the downtown areas of both Chicago and Portland (Oregon) are modestly dispersing and losing market share in relation to metropolitan area employment.

Chicago: The Chicago Loop Alliance reports that private sector employment in the Loop, the core of the Chicago downtown area, fell from 338,000 to 275,000 between 2000 and 2010. An additional 30,000 government workers are employed in the Loop, however 2000 data was not provided for the government sector. As a result of the loss, the Loop private sector share of total Chicago metropolitan area employment fell 13 percent, from 7.7 percent in 2000 to 6.7 percent in 2010.

The larger downtown area, including areas to the north (North Michigan Avenue area) and to the south had total private sector employment of 480,000. Chicago had the second largest downtown (central business district) in the nation in 2000, with an employment density of more than 160,000 per square mile and a transit work trip market share of 55 percent, trailing only the Manhattan business district (south of 59 Street) and the Brooklyn central business district).

Portland: The Portland Business Alliance reported that downtown Portland employment had fallen from 86,800 in 2001 to 83,400 in 2009. This represents a four percent market share loss in comparison to the metropolitan area over the period. All of Portland’s growth over the period has been in suburban Clark and Skamania counties in Washington, which added 12,700 jobs, while the Oregon portion of the metropolitan area was losing 4,500 jobs.

In 2000, Portland had the nation’s 22nd largest central business district, and the 12th highest transit work trip market share, at 30 percent (Brooklyn included).

The Downtown Seattle Jobs Rush to the Suburbs

Wendell Cox — Tue, 20 Apr 2010 23:26:29 -0400

There are few downtown areas in the nation that are more attractive than Seattle. Downtown Seattle is a dream of spontaneous order and a fascinating place well worth exploring. It is one of the nation's great walkable downtown areas, with a mixture of older and newer buildings, hills, Ivars Acres of Clams and the Chief Seattle fire boat on Elliot Bay, Pioneer Square, the Pike Place Market (itself the home of the first Starbuck's coffee) and a hyper-dense 100,000 jobs per square mile.

Downtown boasts the L. C. Smith Tower, which from 1914 to 1966 was the tallest office tower in the west, at 42 floors and nearly 500 feet. Now Smith Tower ranks no better than 35th tallest downtown. Seattle has built so aggressively that a visitor to the observation deck would see more looking up than down. Smith Tower is dwarfed by a skyline containing some of the nation's most impressive office architecture, such as Columbia Center and the Washington Mutual Building, which was named for the subprime mortgage lending champion.

Downtown has many more historic landmarks, such as the Olympic Hotel and the Washington Athletic Club. The art-deco Northern Life Tower was the second tallest until the building boom of the 1960s and would have been the pride of more downtown areas than not. The 1970s Henry M. (Scoop) Jackson federal building is a rare gem of its age, while the Rainier Bank Building is perched on a tapered base that begs the question as to whether it will collapse before the Alaskan Way Viaduct in the great Cascadian subduction zone earthquake (which is due to strike sometime between now and the end of time).

The Condominium Bust: Downtown Seattle has experienced one of the nation's strongest central city condominium booms, though its success (and that of others) has long been drowned out by the high pitched chorus of the Portland missionary society. As in Portland, Atlanta, San Diego, Los Angeles and other newly resurgent downtown areas, Seattle's condominium boom is now a bust as resembling that of a subprime-baby remote desert exurb halfway between San Bernardino and Las Vegas. Even so, the condominium neighborhoods of downtown Seattle are more attractive than what they replaced. Eventually, the large inventory of empty units will be sold or converted into rental units.

The Office Bust: Downtown's condominium bust has spread to its office market as well. The vacancy rate is now over 20%.

The Employment Bust: Data from the Puget Sound Regional Council of Governments (PSRG) indicates the depth of the problem. From 2000 to 2009, employment in the downtown core declined more than 12%, with a loss of 20,000 jobs. But it would be a mistake to conclude that downtown Seattle's employment decline stems from the Great Recession. The losses occurred before. In 2007, the last year before the recession, employment had fallen nearly 18,000 from 2000.

Downtown Seattle's employment decline mirrors trends around the nation and around the world. Now, downtown Seattle accounts for only 8.4% of employment in the four county area, something that would surprise an airline passenger looking at its verticalness from above.

The balance of the city of Seattle has done somewhat better, having lost 3% of its employment since 2000.

Suburban Job Ascendancy: All of the employment growth in the Seattle area has been in the suburbs. While the city, including downtown, was losing nearly 30,000 jobs, the suburbs of King, Pierce, Snohomish and Kitsap counties added 90,000 jobs (Table). Suburban Redmond, home of Microsoft, added 19,000 jobs all by itself. Even Tacoma, the old second central city and long since defeated challenger to Seattle added a modest number of jobs between 2000 and 2009.

EMPLOYMENT IN THE SEATTLE AREA: 2000-2009

Area	2000	2009	Change	% Change
Downtown	164,255	143,952	(20,303)	-12.4%
Balance: Downtown	338,580	329,182	(9,398)	-2.8%
Balance: King County	646,807	662,470	15,663	2.4%
Kitsap County	70,854	81,617	10,763	15.2%
Pierce County	234,619	264,402	29,783	12.7%
Snohomish County	207,764	241,569	33,805	16.3%
4-County Area	1,662,879	1,723,192	60,313	3.6%
Compiled from Puget Sound Regional Council of Governments data.

If You Built it, They Must be Going: With these trends, it might be expected that local transportation agencies would be rushing to provide sufficient infrastructure to the growing suburbs. Not so. Planners are scurrying about to build one of the nation's most expensive light rail systems with lines converging on downtown, to feed 20,000 fewer jobs today and perhaps 30,000 or 40,000 fewer in the future. Perhaps this is the train "got a whole city moving again" as the television commercials put it?

What about growing Redmond? It's on the map. The line is scheduled to reach Redmond sometime between now and the end of time.