Things Will Be Great When You’re Downtown

A decades-long trend toward decentralization of employment in major metropolitan areas seems to have turned around, according to a recent study by City Observatory. During the latter half of the 20th century, as many people moved from the city to the suburbs in search of low-density housing, many retail and service businesses followed them. Likewise, many corporations moved their downtown operations to sprawling suburban office campuses far from the city center.

During the economic expansion from 2002 to 2007, this trend of job decentralization still ruled, the study finds. City centers saw employment growth of barely 0.1 percent per year, while the outlying suburban areas grew 10 times as fast.

But today, a growing influx of talented young workers are moving into urban neighborhoods, and employers are taking notice, the study concludes. A growing number of firms report they are choosing downtown locations in order to tap into this growing talent pool of young workers.

Since 2007 — the period coinciding with the onset and early recovery from the Great Recession — the 41 metropolitan areas tracked by the study showed a 0.5 percent per year growth in city center employment while outlying areas recorded a 0.1 percent decrease. While only seven city centers outperformed their surrounding metro areas in the 2002–2007 period, 21 outperformed the periphery from 2007–2011.