Will the Second City Become the Sixth?

In 1984, Los Angeles overtook Chicago as the second most populous US city. With current demographic trends, Chicago will be soon overtaken by Houston and eventually also by Dallas and Phoenix. Can anything stop the slow decline of the Second City?

Chicago's iconic skyline.

Chicago's iconic skyline.

The numbers are out - for the second year in a row, Chicago is the only shrinking US megapolis. According to the US Census Bureau, Chicago lost 20,000 people (-0.2%) in 2016. That is than three times more than it lost in 2015 and almost five times more than the second-worst performing Cleveland. During the same period, New York gained 36,000 (+0.2%), Los Angeles 42,000 (+0.3%) Phoenix 94,000 (+2.1%), Houston 125,000 (+1.9%), and Dallas whopping 143,000 (+2.0%). Chicago is clearly going through difficult times.

For those of us who mostly frequent the Hyde Park, Loop and perhaps Wicker Park areas, Chicago’s decline is not very obvious. All mentioned neighborhoods undergo rapid development as Central Chicago grew 25% between 2010 and 2015. In fact, Chicago’s downtown is experiencing a strong construction boom with currently 31 cranes building new residential towers - more than in any other US city.

But focusing on the most hip neighborhoods is misleading. Central Chicago offers more and more luxury housing but it still hosts only about 250,000 people. That’s less than a half of Far South Side, which declines the fastest of all neighborhoods. While small affluent areas thrive, rest of the city shrinks.

Multiple complex factors seem to drive the decline. Weather is the simplest explanation: all southern cities of the ‘Sun Belt’ exhibit strong growth rates as affordable air-conditioning made warm states more attractive than the unpredictable north. Nevertheless, some “cold” cities don’t seem to struggle with attracting people: last year, Boston gained 28,000 inhabitants (+0.6%) and Seattle 72,000 (+1.9%).

Chicago’s decline also likely reflects the shared troubles of the Midwest region. Most ‘Rust Belt’ cities have gone through double-digit population decline in the past decades. Chicago has resisted by shifting its economy away from its industrial past but history seems to be catching up after all. However, some other Midwestern cities are not shrinking: Columbus added 21,000 people (+1.1%) last year, Cincinnati 10,000 (+0.5%) and even revitalizing Detroit grew a little bit.

Hence, Chicago-specific issues must be at play as well. Indeed, the city has attracted a good deal of bad publicity recently for exorbitant crime rate, debt crisis and political stand-off between the city and state governance. Moreover, there are several clear deeper underlying legacies that continue to haunt the city. Despite progress, Chicago remains the 3rd most segregated city in the US. The “Chicago Political Machine” is world-famous for its corruption and nepotism. Just these two factors alone form huge obstacles for building an inclusive environment attractive to everyone.

So how can we find solutions that would save this beautiful city from further decline? The winter term’s Urban Entrepreneurship lab class by Professor Abbie Smith might be a great opportunity to examine useful innovations. Jill Hoang who already took the course says: “The class tapped into several emerging urban issues and we explored applying entrepreneurship for solving them. The class also featured a large number of very interesting guest speakers.