Las Vegas is among a host of major metropolitan areas dealing with a growing problem: concentrated poverty. Defined by neighborhoods with at least 40 percent of residents living below the poverty line, poverty concentration is arguably a far more important economic statistic than the concentration of individual wealth or the overall poverty rate. This is because highly impoverished neighborhoods create feedback loops of negative outcomes.
The data show that these outcomes include increased crime, poorer mental and physical health, decreased educational performance, and a lack of economic mobility. Furthermore, rising crime rates along with the social issues resulting from mental health challenges and poor education affect the entire neighborhood, not just its most impoverished residents.
A recent CityLab report found that parts of Nevada have the lowest life expectancy rate for poor residents living in the Western U.S., along with parts of Wyoming, as shown in this map:
A Brookings Institution analysis of the latest U.S. Census data indicates that neighborhood poverty concentration, already on the rise starting in the 1990s, accelerated in the wake of the recession. While suburbs are now home to the largest and fastest-growing poor population in the country, historically disadvantaged communities are faring the worst. According to the Brookings study, the national poverty rate rose by 3.2 percentage points between 2000 and 2010-14. The study also revealed a surprising fact:
If that growth had been shared evenly across places—imagine every census tract experienced the same percentage point increase in its poverty rate—then we might have expected just over 800 neighborhoods to cross the 40 percent threshold to become extremely poor over that time period. Instead, more than 2,700 tracts [did].
Most of the Las Vegas MSA’s raw numerical growth in poverty has occurred in the suburbs, outpacing the poverty rates in the urban cores in the City of Las Vegas, City of Henderson, and City of North Las Vegas by almost 40 points in the 2000s. Despite that suburban growth, the poverty rate still remains highest in the urban areas, as shown in these graphs from Brookings:
The greater Las Vegas metro area has also seen a jump in the percentage of its poor living in tracts with 40 percent or greater poverty rates over the last decade. The map below shows the same upward trend in nearly all the neighboring major metros in the Southwest U.S.:
Despite the increase, Las Vegas is ranked 53rd among the 100 largest metro areas for the percentage of poor people living in neighborhoods of concentrated poverty, at 12.3 percent. Being roughly in the middle of the pack means we outperform many of our neighbors while lagging behind others.
The graphic below shows (in dark red) the areas of concentrated poverty in the Las Vegas MSA:
Source: The Brookings Institution
In 2000, the Las Vegas MSA had just one tract with a poverty rate above 40 percent. Now, four Southern Nevada neighborhoods have a majority of their residents living in poverty. The tract bordered by Charleston Blvd., Mojave Rd., Stewart Ave., and Eastern Ave. has the unfortunate distinction of having the most concentrated poverty in Southern Nevada: 56.6 percent, or almost 6 in 10 residents, have incomes below the poverty line. (In dollars, that’s less than $11,880 a year for an individual or $24,300 for a family of 4.)
In California, Fresno comes in 2nd place nationally with concentrated poverty at 43.8 percent. Bakersfield and Stockton-Lodi also make the top 20 at 6th and 18th, respectively. Nearby Riverside-San Bernardino- Ontario comes in just above Las Vegas at 50th, with the Los Angeles metro area just below at 56th.
San Diego-Carlsbad seems to be on the right track, with their 8.5 percent rate putting them in 77th place. Finally, of the 100 largest metros, the Ventura and San Jose areas are the only two with no neighborhoods at or above 40 percent poverty, earning them 99th and 100th places (and 0 percent rates.)
Arizona has two metro areas on the list of 100, both of which are in the top 20 for poverty concentration. Phoenix-Mesa-Scottsdale is 11th nationally with a concentrated poverty rate of 26.5 percent, and Tucson is in 15th place. By contrast, Utah’s metro areas are in the bottom third of the list. Provo-Orem comes in at 70th at 10.5 percent, Ogden-Clearfield is 87th at 5.5 percent, and Salt Lake City is 98th with just two percent of its poor population in concentrated neighborhoods.
It’s no coincidence that the poverty rates are so high in many of these Southwest and Mountain West states, since they were the epicenter of the housing collapse.
It is also important to note that these poverty-dense neighborhoods are disproportionately populated by racial and ethnic minorities, who were more severely affected by the Great Recession because of relatively lower education levels and the associated lower wages and incomes.
Nationally, African Americans are about five times more likely to live in poor neighborhoods than their white counterparts, and Hispanics are more than three times as likely to do the same:
Because the above-mentioned same demographic groups are now leading Southern Nevada’s population growth, a failure to address the poverty issue will almost certainly result in corresponding decreases in economic, social and physical well-being. Federal, state, and local strategies to address poverty are likely in need of refinement or expansion or both.
While Nevada ranks 13th for the “headline” poverty rate reported by most media outlets, the state jumps to third in the rankings using the more data-driven supplemental poverty measure. This figure includes factors including the local cost of living and the existence (or lack) of a social safety net of assistance for those in poverty.
With just 17 affordable housing units for every 100 extremely low-income renters, Nevada ranks last in the nation for that metric. Is availability the answer? Perhaps not by itself, but a recent study of people displaced from demolished housing projects in Chicago found that those who were forced to move into less impoverished areas (with the help of vouchers) had significantly improved their economic outcomes.
As Nevada’s elected officials, non-profits, and citizen aid groups consider solutions to alleviate poverty, the numbers clearly call for a multi-faced focus. This is the economic and social challenge of our time. If not adequately addressed, it will have long-term repercussions for Nevada’s economic vitality.