Economic growth slow in Philadelphia

The Philadelphia region’s slow economic growth is due to a complex set of factors, according to a recent report, “Flight or Fight,” published by the Philadelphia Metropolitan Policy Center.

Founded last year with a grant from the William Penn Foundation, the Metropolitan Policy Center is a collaboration of the 10,000 Friends of Philadelphia, The Reinvestment Fund, and the Pennsylvania Economy League. Also involved were local academic leaders (including Temple University professors), businesses with local interests, and other organizations located throughout the region.

The center was formed to gather economic data on the Philadelphia region and act as a clearinghouse to provide this data to anyone who wants it.

The “Fight or Flight” report details numerous causes for both the economic and population decline of the city of Philadelphia. One problem is the lack of desirable housing in the city. The city has 26,000 abandoned homes and 31,000 vacant lots. A large number of these vacant properties are concentrated in North Philadelphia, where Temple is located.

A second problem is the high taxes. Philadelphia has one of the highest wage tax rates in the United States. This drives workers out of the city to suburban homes and jobs. According to Dr. Carolyn Adams, professor of Geography and Urban Studies at Temple, the city’s business tax is also hurting the city’s economic prospects. The city has many desirable features for small businesses, including financial institutions and access to markets, but the business tax prevents smaller, high-tech, high-wage companies from starting businesses in the city.

Another professor in Temple’s Geography and Urban Studies department, Dr. David Bartelt, described the situation in Philadelphia as “a self-reinforcing process.” Factors such as the poor quality of schools, lack of desirable housing, high taxes, and crime drive people out of the city. This reduces the city’s tax base, which makes it less able to improve schools, remove blight, lower taxes and fight crime.

Neighborhoods like North Philadelphia have been hit hardest by the city’s economic decline. North Philadelphia has been experiencing a decline since the 1920s, when heavy industries there began moving to the American south.

In the 1960s, the remaining industries also began to migrate southward. Without a nearby office economy, people began to leave North Philadelphia for the suburbs, where jobs were opening in new suburban office parks. The nature of housing in North Philadelphia, built for industrial workers in the nineteenth century, did not attract newcomers to the area.

One positive factor in North Philadelphia has been Temple University, which has revitalized the neighborhood immediately around the university. The university also provides jobs and contributes money to aid the community. The increased security provided by the campus police helps to reduce crime rates around the university as well.