Miami: Why isn't this place as wealthy as its peers? (best, rates)

[polo89]

Originally Posted by DANNYY

It's been bothering me how Miami-Fort Lauderdale is known for wealth so much but it comes in short statistically on wealth. Mostly since I started my paper on it about 3 weeks ago and haven't come to an exact conclusion to finish it yet.

Is it just popularized media of the select few with major bank (wealth) in the region?

I don't get it. What's keeping Miami to not collectively compete with peers around the same size as it.
For comparisons sake it will have to be MSA since Miami doesn't have a CSA so to speak of.

Economic Output (GDP) by MSA 2010:
- New York City: $1.25 Trillion
- Los Angeles: $708 Billion
- Chicago: $520 Billion
- Houston: $407 Billion
- Washington DC: $396 Billion
- Dallas-Fort Worth: $384 Billion
- Philadelphia: $329 Billion
- San Francisco-Oakland: $306 Billion
- Boston: $297 Billion
- Atlanta: $262 Billion
- Miami-Fort Lauderdale: $257 (11th Largest Economic Output)
- Seattle: $217 Billion

Source: http://www.usmayors.org/metroeconomies/0110/charts.pdf

Population By MSA 2009:
- New York City: 19,069,796
- Los Angeles: 12,874,797
- Chicago: 9,580,567
- Dallas-Fort Worth: 6,447,615
- Philadelphia: 5,968,252
- Houston: 5,867,489
- Miami-Fort Lauderdale: 5,547,051 (7th Largest MSA)
- Washington DC: 5,476,241
- Atlanta: 5,475,213
- Boston: 4,588,680
- Detroit: 4,403,437
- Phoenix: 4,364,094
- San Francisco-Oakland: 4,317,853

Okay I am very well aware of the fact that economic output (GDP) is correlated to higher populations but still Miami lags behind Washington DC which has nearly the exact identical MSA population.

As in the more populated areas have the edge for having the higher economic output, thus the competitive edge of Los Angeles & Chicago above the Bay Area on both MSA & CSA level.

Miami however is the 7th largest MSA but the 11th largest economic output. It lags behind Boston which has 1 Million less people in MSA.
It lags behind San Francisco-Oakland which is 1.2 Million less in MSA.

Seattle MSA is only 3.4 Million compared to Miami's 5.5 Million but the difference in GDP is $257 Billion to Seattle's $217 Billion, which is exactly $40 Billion in difference for a difference in population of 2.1 Million people. That is ridiculous.

I don't get it.
Why is Miami not more competitive economically? I'm currently writing a paper on it which is due in a few hours. And this WAS the topic for my paper. The topic was Miami's eroding competitive edge in correlation to one unified economic region (MSA).

For example Washington DC, punches above its weight here. As do Boston & San Francisco-Oakland. Atlanta punches about its exact weight, as do Chicago & Los Angeles. Houston punches above its weight, Dallas-Fort Worth & Philadelphia punch in roughly their weight.

Then what's up with Miami? Why is it's economic output underwhelming for such a large region?

On my paper (for Urban planning class) so far I responded saying that possibly immigration could have a deterring effect on this, since Miami is the most foreign Metropolitan Area in the country with I believe 37% of its population being directly foreign born or so.

Anyone else want to chime in on this?

Mostly location, it's too far South to garner any popular companies to move there. I mean, Miami has it's Latin-American headquarters for many Big name companies, but that may be it. Everything is catered to the Latin-American market, and tourism.

[jobber23]

Originally Posted by DANNYY

It's been bothering me how Miami-Fort Lauderdale is known for wealth so much but it comes in short statistically on wealth. Mostly since I started my paper on it about 3 weeks ago and haven't come to an exact conclusion to finish it yet.

Because Miami although beautiful is located in socially, culturally and economically stagnant Florida. Florida is dirt poor. Get away a few miles from Miami Beach, Palm Beach or Boca and you get dirt poor simple folks, striving to survive another day. Why is this happening? Where is the industry in Florida? Where is the manufacturing? You can't base your entire economy on tourism and retirees coming from the north.

[polo89]

Originally Posted by tpk-nyc

It's a controversial thing to say, especially on this board, but the places hardest hit by the real estate debacle were places where working-class people went to live a simulacrum of an upper-middle-class lifestyle. Places like Phoenix, much of Florida, Las Vegas and the Inland Empire experienced huge booms, but don't have the underlying economy to sustain the population. Especially once you take away new residential construction.

Big corporations and the upper-middle-class/professional salaries they generate are still in old, cold cities like the Twin Cities, Philly, Detroit, etc.

The lesson here is the being cheap isn't enough. Low taxes are not a silver-bullet for economic growth. Retirees have enormous political influence in Florida. They're on a fixed-income and don't want to pay more in taxes. They don't really care about things like education or services and healthcare for children, etc. States like Minnesota and Massachusetts are reaping the benefits of their investment in education, culture, quality of life, etc., to make up for being in very cold climates.

The smart sunbelt states, like Texas and North Carolina, took care to build a more diverse/balanced economy and are doing comparatively better (Texas very much so) as a result.

So darn true, all of it. I gotta rep you for this.

[polo89]

Originally Posted by DANNYY

I hate to sound like a bully but Florida is poised to surpass New York (State) in population within the next 3 years or so but that makes no difference to the economical world.

But look at this and compare it.

Population of State 2009:
New York (State): 19,541,453
Florida: 18,537,969

Economic Output by State 2009:
New York (State): $1.14 Trillion
Florida: $744 Billion

Florida's population is only 1 Million less than New York (State)'s population. But the Economic Output (GDP) is $400 Billion less. That is a staggering difference between the two comparable sized states (by population).

True, true, but the economic powerhouse that is NYC is basically holding and protecting the state of NY in it's giant hands.

[DANNYY]

Originally Posted by polo89

Mostly location, it's too far South to garner any popular companies to move there. I mean, Miami has it's Latin-American headquarters for many Big name companies, but that may be it. Everything is catered to the Latin-American market, and tourism.

Dude don't get me wrong, Florida is one of my Top 10 Favorite States. And it's a great place to visit for any time of the year.

But the city of Omaha, Nebraska has 5 companies that are Fortune 500 Companies. It's a Metropolitan Area of 730,000 people, that's half of Jacksonville's population (Florida's smallest main Metropolitan Area). Omaha is located in the middle of the American Heartland. the whole region around it is sparsely population, and along with Denver & Salt Lake City it might as well be one of the most isolated cities in America in terms of proximity to other places.

And Miami-Fort Lauderdale with 5.56 Million people has the same number with 5 Fortune 500 Companies. Jacksonville has 3, which is admirable for its size given its only 1.3 Million people.

Like I did learn a good bit from this thread, I got some very valid responses that explain what's up with Miami's situation and kidphilly even helped me out on this one too.

But the contents of its corporate base, its economic output, its median housing cost, its unemployment rate, the high poverty rate, & low wage situation, it SERIOUSLY makes me wonder how people in Miami-Fort Lauderdale are doing. How they're able to get by and afford a basic lifestyle.

Originally Posted by polo89

True, true, but the economic powerhouse that is NYC is basically holding and protecting the state of NY in it's giant hands.

Dude, Upstate New York, with a population of 7 Million has a economic output of $400 Billion. That is 10 Million people less than Florida, and 4/7th's of Florida's economic output. And that is considering the fact that New York City is not apart of Upstate New York either. Illinois has 12 Million people and its economic output is $633 Billion. It's 5 Million less than Florida and only $100 Billion less in economic output. I'm not trying to say Miami-Fort Lauderdale is bad or anything, but its just staggering how even in class we have to learn about how people get by there. That is not a good thing, in my opinion.

[Deezus]

Miami developed relatively late in US history...It never had a manufacturing or industrial base to even compare to older, yet smaller Rust Belt cities. And while Miami is perfectly positioned for trade with South and Central America and the Carribean, it's also kind of on the margins of the continental US--it's an outlier, it's not a interstate regional hub like Atlanta. And it never had a resource-based economy like Dallas or Houston.

But one other thing--have you looked at the role the drug trade played in the Miami economy in the 80s? I've seen documentaries and read books about how the huge amount of drug money in the 80s when Miami was the primary entry point for South American cocaine to the US basically fueled much of Miami's growth in that decade. Not to say that Miami's growth that decade was solely based on the influx of illegal drug funds--it's debatable how much this influence this played overall. It's more so that Miami's economy has always been more tied to boom/bust trends, real estate, tourism, etc, than more steady industries...It's similar to Las Vegas in some regards.

[polo89]

Originally Posted by DANNYY

Dude don't get me wrong, Florida is one of my Top 10 Favorite States. And it's a great place to visit for any time of the year.

But the city of Omaha, Nebraska has 5 companies that are Fortune 500 Companies. It's a Metropolitan Area of 730,000 people, that's half of Jacksonville's population (Florida's smallest main Metropolitan Area). Omaha is located in the middle of the American Heartland. the whole region around it is sparsely population, and along with Denver & Salt Lake City it might as well be one of the most isolated cities in America in terms of proximity to other places.

And Miami-Fort Lauderdale with 5.56 Million people has the same number with 5 Fortune 500 Companies. Jacksonville has 3, which is admirable for its size given its only 1.3 Million people.

Like I did learn a good bit from this thread, I got some very valid responses that explain what's up with Miami's situation and kidphilly even helped me out on this one too.

But the contents of its corporate base, its economic output, its median housing cost, its unemployment rate, the high poverty rate, & low wage situation, it SERIOUSLY makes me wonder how people in Miami-Fort Lauderdale are doing. How they're able to get by and afford a basic lifestyle.

Dude, Upstate New York, with a population of 7 Million has a economic output of $400 Billion. That is 10 Million people less than Florida, and 4/7th's of Florida's economic output. And that is considering the fact that New York City is not apart of Upstate New York either. Illinois has 12 Million people and its economic output is $633 Billion. It's 5 Million less than Florida and only $100 Billion less in economic output. I'm not trying to say Miami-Fort Lauderdale is bad or anything, but its just staggering how even in class we have to learn about how people get by there. That is not a good thing, in my opinion.

Naw man, I wasn't angry or anything. I agree with you. Sometimes I wonder the same thing, how people down there survive and live the lifestyles that they do in a relatively 1 sided economic region. I wonder how my family down there live there day to day lives like nothing down there is wrong economically. It baffles me to.lol. I don't know how we did it to be honest.lol. I'm glad my parents chose for us to move to Texas when we did.

[polo89]

Originally Posted by Deezus

Miami developed relatively late in US history...It never had a manufacturing or industrial base to even compare to older, yet smaller Rust Belt cities. And while Miami is perfectly positioned for trade with South and Central America and the Carribean, it's also kind of on the margins of the continental US--it's an outlier, it's not a interstate regional hub like Atlanta. And it never had a resource-based economy like Dallas or Houston.

But one other thing--have you looked at the role the drug trade played in the Miami economy in the 80s? I've seen documentaries and read books about how the huge amount of drug money in the 80s when Miami was the primary entry point for South American cocaine to the US basically fueled much of Miami's growth in that decade. Not to say that Miami was growth that decade was based on the influx illegal drug funds--it's debatable how much this influence this played. It's more so that Miami's economy has always been more tied to boom/bust trends, real estate, tourism, etc, than more steady industries...It's similar to Las Vegas in some regards.

Great point. great point. It has always been dependent on boom bust, rather then steady industries, and to add that it doesn't have any particular resources that are needed. And the whole drug thing is true also. Much of the 80's glam, was fueld by the drug trade.

[tpk-nyc]

Originally Posted by DANNYY

I hate to sound like a bully but Florida is poised to surpass New York (State) in population within the next 3 years or so but that makes no difference to the economical world.

All jobs are not created equal. It's harsh and may sound elitist, but New York is a city of bankers, lawyers and CEOs. They make a lot of money and drive economic output.

The country has changed radically in the last 50 years. Economic activity is no longer tied to population. Regional economies used to be based on a mega-employer, like GM, Boeing, IBM, etc., coupled with major local businesses. For the most part, major local businesses are gone.

I'm only 35, but I can remember a time when there were still local/regional banks, hotels, department stores, drug/grocery store, restaurants and small businesses of every variety. All of these businesses required a population of "professionals" (lawyers, accountants, bankers, advertising executives, managers with MBAs) to service them. Cities were economically diversified and profits were localized.

These businesses have merged into corporate chains that are headquartered in a handful of superstar cities. The high-end salaries from running these corporations and the profits are kept in those cities. It's more efficient from a corporate point of view, but one unintended consequence is that many cities have become denuded of upper-middle-class professionals. To use a Florida-specific example, Disney is a huge employer in the state, but the high paying jobs and profits are in LA and New York.

Nowadays, if you're a corporate lawyer or ad executive, you can only live in a handful of cities because that's where all the business is. There are no local banks of consequence. The vast majority of banking is controlled from New York, Charlotte, Minneapolis and San Francisco. There is effectively one mid-range department store for the entire country, i.e., Macy's, and two mass retailers, i.e., Wal-Mart and Target. Even a huge and wealthy city like Chicago doesn't have a locally-based major retailer (much to their consternation).

Another factor is technology. New York, Houston, DC, Dallas-Fort Worth, San Francisco and Boston are all major tech centers. For cities that "punch above their weight" (like DC or Seattle), it's the tech industry that makes the difference. Cities like Las Vegas, Phoenix and Miami will have a very hard time catching up because they don't have the decades of investment in education.

The real problem with this change is political and not economic. We could eventually have entire states full of executives and designers vs. entire states full of cocktail waitresses and home health aides. This would be very dangerous and unsustainable.

[DC's Finest]

Great Post^^^^^^^