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Median Income Drops Are Tied to Immigrants
NY Times
By STEVEN GREENHOUSE
Median household income dropped between 1989 and 1998 in Queens, Brooklyn, Suffolk, Fairfield and many other counties across the nation that experienced a large influx of immigrants, according to new census data.
The data indicate that even as the economy in the New York region and the nation rebounded after the recession of the early 90's, figures for median household income, adjusted for inflation, failed to climb in many counties because of the increase in low-income immigrant workers.
The new data show that in Brooklyn, Queens and the Bronx — counties with a major increase of immigrants — median income fell sharply. More surprising, though, was the marked income drop in some of the region's wealthiest suburbs, including Nassau, Suffolk and Westchester Counties in New York and Fairfield County in Connecticut.
"Immigrants are jumping immediately into these inner-ring suburbs, which is a change from the past 300 years, when the first generation lived in inner-city neighborhoods," said Robert D. Yaro, executive director of the Regional Plan Association, a civic group that works to improve the economy of the New York region. "This new phenomenon is reducing household incomes in some of the well-to-do suburbs as immigrants move into Bridgeport, Stamford and Norwalk. It's consistent with the national phenomenon of the suburbanization of poverty."
The new data show that median income also fell in many counties in other states attractive to immigrants, including Los Angeles County and Miami-Dade County.
In Queens, according to the data, the median household income fell to $36,480 in 1998 from $44,938 in 1989, a drop of nearly 19 percent, while in Brooklyn it fell by 18 percent, to $27,556 from $33,762.
In Los Angeles County, where there has been a surge of immigrants from Mexico, median income fell in constant dollars to $37,655 in 1998 from $45,962, a decline of 18 percent, according to the census data.
Andrew A. Beveridge, a professor of sociology at Queens College, prepared the analysis that compared the Census Bureau's median income estimates for 1989 and 1998.
Many economists view the median as the best figure for assessing income trends since half the incomes are above it and half below.
Several economists and sociologists, however, argued that the new census data exaggerated the income drop from 1989 to 1998. They said that although median household income might have fallen in many counties, it did not fall as much as the new data suggested.
These economists questioned the new computer model developed by the Census Bureau, and they noted that there was a higher margin of error in analyzing small areas like counties. In addition, critics argued that the way inflation was adjusted might have exaggerated the drop in median income.
Stephen Kagann, chief economist for Gov. George E. Pataki, said the estimated declines were not credible.
"They use an inappropriate starting point, 1989, which was a cyclical peak, thereby ignoring the deep recession that occurred afterwards," Mr. Kagann said. "And they use an inappropriate inflation adjustment that overestimates inflation and thereby underestimates the growth in income."
He said that if the analysis had taken 1993 as its starting point, when New York's economy was near the bottom, the study would have shown a 7.9 percent increase in median household income statewide.
Jared Bernstein, an economist with the liberal Economic Policy Institute, also said that the new census data painted too gloomy a picture. Pointing to another census study, from last March, he noted that median household income for New York State dropped by 7 percent from 1989 to 1998. He added that a 5 percent increase in income in the two boom years, 1999 and 2000, meant a decline of just 2 percent from 1989 to 2000.
Still, he saw economic problems in the state. "In New York, you've had an amplified version of the expanded income gap we've seen nationally," he said. "Folks in the high end — in law, high tech, financial markets — were in a good place to ride the boom. Meanwhile, the huge supply of low-wage workers who were serving these upper-end workers during the boom didn't do nearly as well."
Mr. Beveridge's analysis estimated that median income in Nassau County fell by 14 percent ($61,096 in 1998 from $71,202 in 1989), 16 percent in Suffolk ($54,008 from $64,580), 11 percent in Westchester ($56,865 from $63,629), 12 percent in Fairfield ($57,389 from 65,583), 12 percent in Hudson County ($35,743 from $40,641), 17 percent in Passaic County ($40,923 from $49,421) and by 10 percent in Essex County ($40,595 from $45,375).
While critics derided the numbers, Mr. Beveridge defended them, saying the arrival of immigrants in Bridgeport, Yonkers, Paterson, Hempstead and other communities could have caused a double-digit decrease in income.
In the preponderance of counties nationwide, median household income rose from 1989 to 1998. The counties with declines were often in metropolitan areas with the greatest surges in immigration, including New York, Miami, Los Angeles, San Diego and Washington.
Roger Waldinger, an immigration expert at the University of California at Los Angeles, said the decline in household income could have been fueled by factors having nothing to do with immigration, like the increase in one-member and single- parent households.
Economists have pointed to other reasons for stagnant or declining incomes, including pressure from import competition, the declining power of labor unions, automation that pushes workers out of jobs and poor schools that churn out students who lack job skills.
Dr. Waldinger has conducted studies showing that in many communities, immigration affects income levels and the gap between rich and poor. He said income levels were dragged down by unemployment, not immigrants, who he said usually worked long hours. But many economists say limited skills and inadequate English relegated many immigrants to low-paying jobs.
