Detroit's Decline in Perspective (Warren, Saginaw: lease, loan, how much)

[ram2]

Originally Posted by leroythelion

Ford's primary motivation was staff retention. He correctly figured out that it cost more to train new employees in a high turnover situation than to pay them more than the competition. True, he was also creating a market for his product, but the low turnover increased profits.

True. Ford had a 200% annual employee turnover rate prior to establishing the $5 a day wage.

[ram2]

Originally Posted by detwahDJ

and I didn't know there was a high turnover rate. No expert here.

Where were you in the 1920s? Fred Bear, the archery entrepreneur, worked in a Ford auto plant for a few years in the 20s and quit due to the unfavorable environment.

[animatedmartian]

Originally Posted by 313Weather

Ahhh, but see Detroit as a region did make up for its loss of manufacturing, at least somewhat. Its benefits just weren't felt in the city proper.

No it didn't. And in this statement you've separated city and suburbs because if the region did make up for the loss in manufacturing, Detroit would not be in it's current state. However the region did not make up for the loss and manufacturing but still grew despite the loss.

All of the real estate firms, accounting firms, doctor offices, law firms, etc. you're referring to could have easily set up shop in the city like they did in any other city across America, but they instead chose to establish themselves outside the city proper. If there wasn't enough room to build horizontally, there was the option to build upward.

That's not an accurate and conclusive statement. For one, all cities range in size and shape so "setting up in the city proper" might be completely irrelevant in another city. Many cities have annexed land over time to expand their city boundaries. So what once might have been an outlying suburb might now be within "city proper" and there are many cases where this is true. Detroit, as you might know, is very limited in it's ability to expand. If it wasn't, I don't think you would have made that sort of statement.

I think you see where I'm going. Thus, the question I asked before "Why did Detroit fall to the extent it did?" remains unanswered, as there's no simple answer.

There is a simple answer and I've been saying it; Detroit fell to the extent it did because of how large the factories were and the size of the workforce that it drew. That workforce is now gone. 94% of the peak employment at the Ford River Rouge Plant is gone due to modernization. So 94% of the workers of that plant, had they stayed in Detroit, would currently be unemployed unless they moved somewhere else or find another job by whatever means.

[one is lonely]

Wow, there has been an explosion of responses.

Originally Posted by Sharks With Lasers

If you notice, Detroit's decline started much earlier than the others, and outside of the 1990s, it's been faster than all of the rest. Part of it might be racial demographics - Flint, Pontiac, and Saginaw are all more than 30 percent white, so white flight wasn't as extensive. Also, all of these cities were growing until 1960 (and holding steady until about the 1970s for the most part,) as opposed to Detroit, where almost 30 percent of its decline occurred prior to 1970.

Flint and Saginaw are unique from Detroit in the sense that neither had a large enough economy to fuel the level of suburban expansion Detroit indulged in. Flint and Saginaw couldn't build up new downtowns the way Detroit essentially did in Southfield and Troy, for example. That's why white flight wasn't quite as dramatic.

Pontiac is a little tougher to analyze, as it was swallowed up by Metro Detroit. Still, it seems to have followed the same trajectory as Flint and Saginaw.

Originally Posted by 313weather

How can the suburbs in a region that hasn't grown a lick remain relatively (emphasis on relatively) healthy while the city center of that same region has not? You don't think it's more to it than the disappearance of manufacturing jobs?

Suburbs, by design, spread out urban economies. In our case, our suburbs have mitigated the negative effects of relying on the auto industry by spreading out the blow. Ask yourself, what's worse: one city losing 20,000 jobs, or four cities losing 5,000 jobs each? I'd go with the latter. Probably at least two of those cities could find a way to recover from the loss.

It should come as little surprise to you that a recent study found that Metro Detroit had the worst job sprawl in the nation, as measured by commutes. Now ask yourself another question: why do we love decentralization so much in Metro Detroit? It could be because we build cars. Sure. Or it could be that on some subconscious level we're trying to escape the debilitating problems that the auto industry's presence brings about.

Again, I'd go with the latter.

I don't think our suburbs have proven to be a sustainable metropolitan model yet. It's slowed Metro Detroit's decline, keeping our overall population stable, but show me a middle class suburb that's stayed strong over the decades and I'll show you five that haven't.

[one is lonely]

Originally Posted by Ram2

I used to live in Cincinnati where the 2 big employers are Proctor&Gamble and General Electric. Those companies lay off employees just like the Detroit 3.

Cincinnati has 5 Fortune 500 companies in the city alone, which is over half of the Fortune 500 companies in the region. Detroit has 2, one of which is a local utilities company. The other is GM. If my quick calculations are correct (I may have overlooked a company or two), 75% of the Fortune 500 companies in the Metro Detroit region are directly auto-related. That shows just how dependent the 4 million people in Metro Detroit are on the auto industry, and the outsized growth the industry promotes.

A brief scanning of Pittsburgh reveals that the city itself has 7 Fortune 500 companies. 7! While U.S. Steel is still the top company in the region, Pittsburgh has a diversified industrial base, from ketchup to paints and coatings. Detroit could only dream of such industrial diversity. Also, both Pittsburgh and Cincinnati have a major financial institution located in the city (PNC and Fifth Third, respectively).

Meanwhile, we're living and dying by the auto industry.

[Indentured Servant]

While I think that had the auto industry not gone into crisis in the early 80’s and later the region would be much larger but Detroit proper still would have continued to decline for other reasons. There were two separate and distinct waves of decline, the first driven by whites and the second driven by blacks. The black exodus of the past 12 years, given that the black population peaked in 2002, was driven primarily by sub prime lending debacle and the collapsing Michigan economy during that era. Many African Americans did not just leave the city…..they left the state altogether. Many people in inner ring suburbs put their homes up for sale or rent either because the housing market allowed them, through low interest loans, to afford bigger and better homes in further out suburbs or people needed to sell their home or rent them to seek employment in another state due to the “Michigan Recession” that existed years before the national recession hit.

I am confident that Detroit population would have stabilized at around 850-900 thousand people had it not been for the sup prime/housing debacle and the collapsing economy. Also, cities were destined to decline as household size declined. The size of the nuclear family and the propensity of extended family living in one housing unit have declined considerably since the 50’s when Detroit’s population peaked. Change in household size, since 1950, would account for a loss of about 250,000 thousand people. Nearly every major Northern city, in 1950, population is down considerably today, with the exception of New York City, assuming that they have not annexed any areas like is the case with Indianapolis and Columbus. Thus, some of Detroit decline was NORMAL.

Let’s take the diverse and healthy economy of Minneapolis. In 1950 its population peak also, at 521,000. Today, 382,000 people live in that city. It lost 27% of its population since the 1950’s. Thus, one could argue that Detroit was destined also to lose about 27% of its population, which would have put Detroit at around 1.3 million people in 2010. Hence, we should not look at the 1.8 million as the baseline of how far Detroit has dropped, but rather, a different baseline adjusted for changes in family structure and society (suburbanization). That adjusted baseline would be about 1.3 million people. Thus, one needs to account for the loss of 600,000, which is, in my opinion, the consequence of the auto industry decline, racial fears and prejudice, the housing giveaway of the last decade and crime not necessarily in that order. .

[one is lonely]

Your adjusted base line is wrong. The average family size in 1950 was approximately 3, and now it's approximately 2.5. That means Detroit's adjusted base line is, in fact, roughly 1.5 to 1.55 million people. According to the 2013 census estimate, Detroit's population is 680,000, and that number is decreasing every day. That means Detroit is down over 800,000 people from the adjusted base line.

Also, from 1950 to 1960, Detroit lost about 180,000 people, despite the fact that the average family size increased that decade to back over 3. In that light, you can see how that decade was, in fact, the beginning of the end. It wasn't until the late '70s that a diminishing average family size began to play a real role in the population size of urban cities.

[Indentured Servant]

Originally Posted by one is lonely

Your adjusted base line is wrong. The average family size in 1950 was approximately 3, and now it's approximately 2.5. That means Detroit's adjusted base line is, in fact, roughly 1.5 to 1.55 million people. According to the 2013 census estimate, Detroit's population is 680,000, and that number is decreasing every day. That means Detroit is down over 800,000 people from the adjusted base line (although, if we consider that Detroit's average family size is actually 2.59 and factored that in, it'd be down even more).

Also, from 1950 to 1960, Detroit lost about 180,000 people, despite the fact that the average family size increased that decade to back over 3. In that light, you can see how that decade was, in fact, the beginning of the end. It wasn't until the late '70s that a diminishing average family size began to play a real role in the population size of urban cities.

Go back and read my post clearly. I stated that 250,000 loss was attributed to decline in the Household size. Besides, the family size is not synonymous with household size. I also mentioned the greater propensity of extended family living in one housing unit back then...kind of like immigrants due here today.

That having been said, later I used a the example of a HEALTHY CITY, that also declined, to set the baseline of NORMALITY for Midwestern cities. Read again what I said. I said the decline of household size PLUS CHANGES IN SOCIETY (Suburbanization). What do you think it meant when I added those words to my post? They were not for decoration. Super Highways, the GI Bill and the like created a trend towards suburbanization, which also helped reduce the size of cities....even healthy ones like Minneapolis.

Read carefully next time. I can go back and highlight what you overlooked if that helps you to understand any better.

[one is lonely]

You're right that I made a mistake by using family size instead of household size. The average household size in 1950 was 3.37, and as of 2010 it was 2.58. That gives us an adjusted baseline of 1,415,990 people. For the adjusted baseline to be at 1.3 million, you'd have to assume modern urban planning kicked over 100,000 people out of the city with highways and urban renewal projects. However, considering that many of the people dislocated by freeway construction in Detroit were, for example, moved to high rise housing projects, it's tough to gauge the impact. I-75 destroyed Black Bottom, but 10,000 people lived at the Brewster-Douglass Project alone at its peak.

[one is lonely]

Also, when considering Detroit, we must remember that some of the outer subdivisions were still being built up in the 1950s. The amount of households was growing while the population was already decreasing.