Saturday, August 20, 2005

The Benefits of Big City Deindustrialization

Between 1969 and 2000, the number of manufacturing jobs in New York county, which includes New York City, declined from 451,330 to 146,291. Big city manufacturing job loss is not unique to the United States. Over the last thirty years, London has lost 600,000 manufacturing jobs--and gained 600,000 jobs in business services, as well as 180,000 jobs in entertainment, leisure, hotels, and catering.

The popular media has done a good job documenting how this sectoral transition affects land use in big cities. Today's New York Times discusses land use changes near the United Nations in an article titled "Developers Find Newest Frontier on the East Side. "Long ago, the area's breweries, slaughterhouses, coal yards and warehouses began yielding ground to the United Nations and other residential and commercial buildings."

The popular media has not done a good job investigating what are the "Green City" benefits from deindustrialization. Scholars such as William Julius Wilson have pointed out that manufacturing jobs paid high wages and that many minorities held these jobs in big cities. But, manufacturing imposed serious environmental costs for cities. Look at Chicago and Pittsburgh's air and water quality in the past relative to today. In many industrial cities such as these, the "death of manufacturing" has been a good thing for the environment.

This dynamic has played out to an even larger extent in Eastern Europe's ex-communist cities. It took me a fair amount of work but I was able to build data sets in the 1990s for major cities in Hungary, Poland the Czech Republic to document this fact. To see this paper; read

I recognize that sectoral shifts (such as the death of steel plants) disrupts people's lives. It is difficult for a 55 year old home owner in Pittsburgh who worked in a steel plant to reinvent himself as a computer programmer when the steel industry declines. Despite the short run costs imposed by the decline of big city manufacturing, the public health benefits from these large cities making a transition to clean services must be huge.