By CLAIRE CAIN MILLER
Like many residents of Northwest Portland, Matthew Hale doesn’t own a car. Instead, he prefers to walk or ride the bus to the city’s innumerable coffee shops and breweries and live-music spots. On weekends, he and his wife have no problem hitching rides to the Pacific Coast or the Cascade mountain range. Everywhere he looks, Hale told me, there are people just like him — bearded, on skateboards, brewing kombucha. “It’s really chill,” he says.
Portland has taken hold of the cultural imagination as, to borrow the tag line from “Portlandia,” the place where young people go to retire. And for good reason: The city has nearly all the perks that economists suggest lead to a high quality of life — coastlines, mountains, mild winters and summers, restaurants, cultural institutions and clean air. (Fortunately, college-educated people don’t value sunshine as much as they used to.) Portland also has qualities that are less tangible but still likely to attract young people these days, like a politically open culture that supports gay rights and the legalization of marijuana — in addition to the right of way for unicyclists or the ability to marry in a 24/7 doughnut shop. “It’s really captured the zeitgeist of the age in a way that no other small city in America ever has,” said Aaron Renn, an urban-affairs analyst who writes the Urbanophile blog. According to professors from Portland State University, the city has been able to attract and retain young college-educated people at the second-highest rate in the nation. (Louisville, Ky., is No. 1.)
City dwelling is generally considered a good thing for the overall economy. Proximity and serendipity offer employers a better chance to hire the perfect person for a job as opposed to someone whose skills just sort of match, according to the work of Enrico Moretti, an economist at the University of California, Berkeley. Chance encounters in dense cities, Moretti has argued, lead to innovation, which subsequently leads to income. And as the baby boomers retire, the pressure is on the young and highly educated to spur urban economies. As a result, many American cities are remaking themselves to lure human capital, offering various perks, like cheap housing and tax breaks, in the hope that smart young people can attract others like them. The Greater Houston area has added more than a million residents since 2000, in large part through generous tax breaks and the growth of the energy sector. Las Vegas is in the middle of a privately funded $350 million project to transform its derelict downtown into a tech incubator. Parts of Detroit have more or less been turned over to the online-mortgage billionaire Dan Gilbert. Other cities like Austin, Tex.; Boulder, Colo.; Raleigh, N.C.; and Nashville have tried, in some way or other, to spark their own little Silicon Valleys.
Portland, meanwhile, has the opposite problem. It has more highly educated people than it knows what to do with. Portland is not a corporate town, as its neighbors Seattle and San Francisco have become. While there are employment opportunities in the outdoor-apparel business (Nike, Adidas and Columbia Sportswear are all nearby) or the semiconductor industry (Intel has a large presence in Hillsboro), most workers have far fewer opportunities. According to Renn, personal income per capita in the city grew by a mere 31 percent between 2000 and 2012, slower than 42 other cities, including Grand Rapids, Mich., and Rochester. And yet people still keep showing up. “People move to New York to be in media or finance; they move to L.A. to be in show business,” Renn said. “People move to Portland to move to Portland.” Matthew Hale may have all the kombucha he can drink, but he doesn’t have a job.
Hale, who is 35, told me he is actively looking for work in the field of graphic design. In the meantime, he is getting by, he said, through various freelance gigs and his wife’s income as a barista. This is typical of many Portlanders. (I, too, am originally from there.) David Albouy, an economics professor at the University of Illinois, has created a metric, the sacrifice measure, which essentially charts how poor a person is willing to be in order to live in a particular city. Portland, he discovered, is near the top of the list. Even when college-educated residents get jobs there, they earn 84 cents for the average dollar earned in other cities, according to Greg Schrock and Jason Jurjevich, professors of urban studies at Portland State University. In 41 of the country’s 50 largest cities, young, educated people earn more than they do in Portland. “It’s a buyer’s market for labor,” Schrock says.
Portland’s residents may, as the saying goes, want to keep their city weird. But do they want to keep it broke too?
As America has segued from a manufacturing economy to a largely service-based one, its cities have been undergoing a steady metamorphosis. Access to ports and blue-collar workers are no longer the key to thriving urban economies. Now it’s educated people with desk jobs who drive the growth. Of the 10 largest cities in 1950, eight of them currently have smaller populations, according to Edward Glaeser, the Harvard economist and the author of “Triumph of the City.” The exceptions are Los Angeles and New York. And though Hollywood remains the country’s entertainment capital, New York has succeeded in large part on its ability to transform itself from a sugar, meatpacking and garment-manufacturing center to the financial capital of the world.
Since 1950, the disparity between incomes and home prices has steadily widened to the point that many urban areas have become largely unaffordable to the middle-class workers who once inhabited them. Economists at the University of Pennsylvania and Columbia have coined the term “superstar cities” to refer to the likes of New York, San Francisco, Los Angeles and Boston. “Even large metropolitan areas might evolve into communities that are affordable only by the rich, just [like] exclusive resort areas,” wrote the economists Joseph Gyourko, Christopher Mayer and Todd Sinai in a 2013 article.
As the superstar cities have become unattainable, the middle class is increasingly finding refuge in places like Philadelphia or Nashville, Denver or Charlotte, N.C. An example of “the people who are getting killed,” Renn said, “is the old traditional blue-collar Queens person who’s now getting squeezed with taxes and with housing costs. It’s clear they don’t fit into the vision of the city. They’re basically realizing, Hey, I can go to Charlotte and live like a king on a truck driver’s salary.”
Portland’s story is slightly different in that many of its immigrants have come in search of a different kind of wealth. Most people, after all, can’t willingly up and move to a new city for — rather than a job opportunity — some ephemeral or lofty ideals about homesteading and locally grown kale. But quite a few Portlanders have done so. “As our culture and expectations grow, decadence rises,” Albouy said. “We’re not the hungry immigrant nation we used to be. We’re more into meaning, into jobs that find fulfillment. And at least some people are willing to accept lower pay to go somewhere they care about.” According to Joe Cortright, the president of Impresa, a Portland-based consulting firm on regional economies, young people are increasingly telling themselves, “I’m going to move somewhere and pursue my career,” rather than, “I’m going to pursue my career and go wherever it takes me.” For “the beer, bikes and Birkenstocks people,” as Cortright put it, that means Portland. Hale, for instance, had planned to move to New York, where he found plenty of listings for graphic-design jobs. Then, by chance, he and his wife visited a friend in Portland and fell in love. “Jobs are thinner here,” he said. “But the intelligent urban planning makes my heart sing.”
Heartwarming planning, however, can only go so far. Portland’s paradox is that it attracts so many of “the young and the restless,” as demographers call them, that it has become a city of the overeducated and underemployed — a place where young people are, in many cases, forced into their semiretirement. A July report by the Oregon Employment Department fretted about the state’s low personal income and employment-to-population ratio. The average income of Oregonians in recent years “may have been a ‘victim’ of the state’s attractiveness, and a resulting population influx” by new residents who don’t earn much, the report said.
Yet Portland is hardly immune from larger economic forces. The vast majority of its migrants hail from the West Coast, including many who have been priced out of Seattle or San Francisco. And as more of these newcomers flood the city, they threaten to remake its slacker image. Surreptitiously, this process is already underway. Between 2001 and 2012, gross domestic product per person grew 50 percent, more than any other city, even those in Silicon Valley. Accordingly, employment is climbing, as are housing prices and the overall cost of living.
Affordability has long been one of Portland’s most attractive features. What happens when that disappears? Schrock and Jurjevich, the economists at Portland State, have coined a term, the amenity paradox, that refers to cities where the same amenities that attract people end up eroding what made a city desirable in the first place. Portland seems likely to fall into this historical cycle. Just as some New Yorkers may decamp for Charlotte to live like kings, it’s likely that Portland’s designers and baristas, the very people who have made the city what it is, will one day no longer be able to afford the houses they live in, either. “We could have told a similar story about retiring Midwestern farmers moving to Los Angeles at the end of the 19th century,” Glaeser says.
Albouy told me that he has always wondered why Portland doesn’t invest more in its institutions of higher education. If you took Portland’s quality of life and citizens, he said, and added Pittsburgh’s universities, you would come out with a world-class city. But the answer, perhaps, is that Portland’s best chance for retaining its culture is to make sure other people don’t want to live there. (Unless, of course, it is those nine months of constant rain.) At some point, though, the economic forces may be beyond their control.
Another solution for keeping Portland weird, at least temporarily, may come from within the city itself. In the wake of the financial crisis, many young college graduates have delayed their lives, put off worries about jobs and houses and families and instead moved to cool cities to wait out the recession, says William Frey, a demographer at the Brookings Institution. During that time, the young and educated abandoned cities like Phoenix and Atlanta in large numbers for places like Austin and Portland. But as job prospects improve, and unemployment shrinks to its lowest levels since the crash, it’s likely that many of the young people who fled to Portland will soon chase their ambitions to less cool places — the ones that people move to when it’s time to become an adult. Then Portland will find out who the true believers really are.