By Rick Badie
News of employment activity in downtown Atlanta was topped off recently when we learned Coca-Cola expects to relocate at least 500 workers to the city core from the ‘burbs in Cobb County. Is Atlanta experiencing a sustainable in-town jobs migration? Today’s guest columnists weigh that possibility as well as its regional significance.
Back-to-the-city crowd wins
By Greg LeRoy
I have seen America’s future prosperity. It is downtown, and it gets to work by public transit.
That’s why companies like Coca-Cola, Panasonic, Athenahealth, ExactTarget and Asurion Insurance Services are moving jobs into Atlanta. Like smart companies in most U.S. cities, they are voting with their feet for a winning urban future.
There’s no stampede yet back to the city. The long-term thinning of jobs continues. However, a recent Brookings Institution study found that “job sprawl” slowed during the Great Recession, if only because job loss was greatest in outlying areas. That was more true in the metro Atlanta area than nationally.
I’m betting on the back-to-the-city crowd. Why? Because employers on the transit grid have fuller access to regional labor markets. Because tech-savvy Millennials are giving up car ownership in record numbers. Because locating on transit says a company favors energy-efficiency, workforce diversity and quality of life — winning corporate traits.
I’m also convinced that urban density and transit-oriented development create far more jobs than sprawl. Recovery Act data revealed that building transit creates far more jobs per each billion dollars spent than highway construction. Federal highway data reveals that “fix it first”— spending to maintain and improve existing roads, including “complete streets” for pedestrians and cyclists — produces more work-hours than new roads.
It’s not just the jobs building infrastructure. Transit spending stimulates private investment in half-mile radii around stations, creating jobs and wealth as higher land values drive greater density, rehabilitation and mixed uses. When buildings are taller and more complex, they are more labor-intensive to build.
Finally, there’s the tragic history of job sprawl. Visionary William H. Whyte chronicled the flight of corporate headquarters from New York City in “City: Rediscovering the Center,” which was famous for showing that companies followed executives’ home addresses (and golf courses). He tracked 38 such moves. “Companies don’t have to … compare area A with area B and area C. All they have to do is look in the phone directory. Where does the boss live? That is where the company is going.” Thirty-one of the 38 companies moved close to the CEO’s home.
Whyte wrote about how isolating such places could be, and how executives no longer got much face time with colleagues. In other words, he suggested the companies were losing touch and losing their edges. Indeed, 10 years later, he checked back, comparing the companies that moved with 36 similar firms that stayed downtown. Seventeen of the 38 footloose firms had been taken over. Companies that stayed in New York had twice the growth rates and had increases in their stock valuations of more than 2 1/2 times those that had fled.
As a former Chicagoan, I watched storied urban retailer Sears suffer catastrophic setbacks since 1989, when it fled the transit-rich Loop to a distant suburb that then lacked even bus connections.
The future of prosperity is in dense, transit-oriented cities and suburbs. It’s where the creative class thrives, where start-ups get started, and where mature companies keep their edge.
Greg LeRoy is executive director of Good Jobs First, a Washington, D.C.-based policy resource center.
Job sprawl creates challenges
By Elizabeth Kneebone
The economically turbulent 2000s, a decade marked by two recessions and sluggish growth, left almost no major metropolitan area unscathed including metro Atlanta. After job gains earlier in the decade, the post-recession period between 2007 and 2010 saw this area shed more than 200,000 jobs. The unemployment rate more than doubled.
Today, though recovery has yet to bring back all the lost jobs, regional employment is once again growing. But it’s not just the growth or decline of employment that affects the long-term economic health of an area. Where jobs locate matters. The geography of employment intersects with a range of issues — transportation, land use, workforce development and regional innovation — that help determine the extent metro areas are developing in productive, sustainable and inclusive ways.
Like almost every other major metro area, Atlanta-area jobs shifted from the urban core during the 2000s. Employment grew outward, adding jobs more than 10 miles away from downtown while shedding employment in close-in places. Widespread job losses following the Great Recession stalled the outward shift of employment, partly because of the heavy toll the downturn took on more suburbanized industries like construction, manufacturing and retailing, which drove steeper job losses beyond10 miles from downtown.
Still, during the 2000s, the share of greater Atlanta’s jobs in the urban core and between 3 and 10 miles of downtown declined by 0.4 and 3.8 percentage points, respectively, while the share of jobs more than 10 miles from downtown grew by 4.2 percentage points, double the average rate of increase for the nation’s largest metro areas.
By decade’s end, 64 percent of metro Atlanta’s jobs were more than 10 miles from downtown, a figure well above major metro average of 43 percent and surpassed only by metropolitan Chicago’s 67 percent and Detroit’s 77 percent. At the same time, Atlanta located fewer than 1 in 10 jobs in the urban core, compared to a metro average of 23 percent. Only Detroit posted a smaller share (7 percent) of jobs within three miles of downtown.
The shift of jobs outward and away from the urban core can create a host of regional challenges. It can mean a strain on infrastructure, more cars on the road, longer commutes and higher transportation costs. And it can make it harder for low-income residents to reach employment opportunities elsewhere. Research at the Brookings Institute has found that, though 88 percent of the region’s poor lives in suburbs, less than a third of suburban residents have access to transit; those who do can reach only 17 percent of the region’s jobs in a 90-minute commute.
A region can grow outward in smart ways — encouraging dense and mixed-use development in both the urban core and in suburbs, and linking up planning around jobs, housing, transportation and land use. Without policy action to encourage a different course, renewed job growth will likely bring a return to “job sprawl” as usual.
Elizabeth Kneebone is a fellow at the Brookings Institution Metropolitan Policy Program.