Sunday, February 25, 2007

Hanging Around, Going Nowhere ...

More from the New York Times:

With no real place for the poorest of the evacuees in the economy before the storm, New Orleans may have permanently lost that part of its population. Supporting that notion is an unpublished analysis by William Oakland, former Tulane economist, which shows unusually low rates of participation in the labor force before Hurricane Katrina.

Thus, a frequent impression of pre-hurricane travelers to New Orleans — that there were “a lot of people hanging around, going nowhere,” as the Nobel-winning Columbia University economist Edmund S. Phelps, a sometime-visitor, puts it — turns out to have a statistical basis.

The statistics, which compare the number of people actually working with the total working-age population, suggest “there are a lot of people out there not working,” said Mr. Oakland, referring to the period before Hurricane Katrina. Or, he said, they were working in an underground economy, not measured by statistics. If not actually illegal, he said, it was not very profitable.

In New Orleans, before the storm, about 4 out of 10 men in the working-age population were out of a job or not looking for one, compared with less than 3 in 10 nationally.

Employment had dropped sharply in the city from 1969 to 1999, Mr. Oakland writes. More than half of young black men ages 16 to 24 were not in the labor force. Unemployment rates among young blacks were above 25 percent. “The data is showing New Orleans is really a basket case,” Mr. Oakland said.

In the city’s poorest areas, the numbers were even more discouraging. In places like the Lower Ninth Ward or Central City, half of all working-age people were not looking for work, Mr. Oakland wrote. The real unemployment rate in these impoverished, high-crime areas, which would include those not looking for work, would have been a “whopping” 32 percent, he wrote.

Compounding the city’s difficulties, and, in effect, helping to stem the population loss, was a secondary factor: the direness of the city’s poverty, and its concentration. Those conditions helped make the city’s poor population exceptionally immobile. New Orleans was also poor not only in absolute terms, but also in relative terms. The poorest 30 percent of households had a lower share of the city’s total income than the comparable slice in any other similar Southern city, Mr. Oakland found.

“The job mobility was very low among the poor, so they just stay where they are, and the social welfare system shored them up,” Mr. Oakland said.

The city’s population was thus “out of equilibrium, if you would say that,” Mr. Oakland added. “It’s not normal to have that level of nonparticipation in the labor force.”

Haunting the city’s effort to repopulate, too, is the incalculable toll inflicted by ghosts from its past — a political legacy of corruption and patronage, and a deep racial division with a far more distressing passage toward integration than was experienced, say, in Atlanta.

Looking to the future, another 50,000 people might eventually be added to the city’s population, Mr. Oakland suggested, but there are no guarantees.

There has been little to no construction of cheap housing that would enable the return of the largest category of those still displaced, Mr. Stonecipher noted.
A second category of people, 50,000 or more who have established themselves elsewhere but who could return, may be even harder to recapture, given the combination of past weaknesses and continuing present-day hurdles.

“The longer it lasts, the more likely it is that our population is plateauing, the longer the uncertainty continues,” said Janet Speyrer, an economist at the University of New Orleans.


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