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Derek Thompson

Derek Thompson - Derek Thompson is a senior editor at The Atlantic, where he oversees business coverage for the website.
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He is a visiting research fellow at the Committee for a Responsible Federal Budget at the New America Foundation. Derek has also written for Slate, BusinessWeek, and the Daily Beast. He has appeared as a guest on radio and television networks, including NPR, the BBC, CNBC, and MSNBC.

City Incomes Are Catching Up to the 'Burbs. Why?

By Derek Thompson
Oct 9 2009, 4:30 PM ET Comment

Seattle and San Francisco city dwellers earn significantly more than people in the rest of their metro area, according to this graph after the jump from Discovery Urbanism (via Yglesias). You can't exactly say the same for Detroit. But I wonder: why are city incomes across the country catching up to their overall metro areas?




graph 1

The story here is that central city incomes fell in relation to metro areas in the 1980s, but the relationship flattened in the 90s and central cities slowly started to make up ground over the last 10 years. All of that is true for Detroit -- except for the last part. City incomes have fallen to about half the average income of the Detroit metro area. That's kind of incredible. (Also, look at Atlanta go!)

Why explains this trend? Ongoing investment in central cities, says Daniel at DU. I have a different idea. Don't we know that wages have stagnated in the US over the last ten years? Slate's Tim Noah found this awesome graph that demonstrated how health insurance premiums have gobbled up our raises over the last ten years. So it seems overall wages are stagnating, yet within that stagnation, we're seeing city people's incomes catch up to their metro neighbors. Maybe that's just because wage inflation slowed in the burbs more than the cities. But truly, I'm not sure I know why. Ideas?

Chart from the U.S. Department of Health and Human Services.

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