Philadelphia’s economy was on an upswing. Then the coronavirus hit.
The state of our city is complicated and bittersweet. Things were looking up before the coronavirus.
Before a once-in-a-century pandemic came crashing down on it, Philadelphia was on an upward economic trajectory.
The Pew Charitable Trusts’ annual “State of the City” report released Tuesday shows that while Philadelphia’s violent crime rate continues to rise and poverty remains a persistent problem — the highest rate in any large city — there were gains last year in population, educational attainment, and jobs.
The key word may be were.
“The picture was one ... that we characterized as largely a story of success,” said Larry Eichel, a senior adviser with Pew. But now the report has become more of a benchmark of where the city was before entering what could be its most challenging year in a century. A flood of questions lies ahead.
“The city’s population growth has been slowing. Will the city stop growing?" Eichel asked. "Will the spike in unemployment be a short-term setback or a long-term problem? Will the rise in homicides continue or will Philadelphia be a less violent place when this is over?”
Our population was growing
Philadelphia continued to add residents for the 13th consecutive year, with about 500 more people living here today than in 2018. Residential construction permits increased 41% over last year, the highest level this century and a sign of the construction boom that has continued as neighborhoods gentrify.
(The increase in permits could partly be a reaction to a reduction in the city’s tax abatement beginning in 2021.)
Since 2006, the city has added 95,000 residents, mostly millennials and immigrants.
Whether that trend continues is unknown. Philadelphia has adapted to pandemics before, and many cities actually saw an increase in population after the 1918 Spanish influenza. But that was also a time of robust immigration and industrialization in this country. If remote working becomes the norm, fewer people may feel the need to live near jobs in city centers.
Job growth was at an all-time high. Now unemployment claims are.
Before the coronavirus, city unemployment in 2019 was at a 10-year low of 5.2%, though that was higher than rates in neighboring counties, other cities, or the nation. But Philadelphia’s unemployment rate had dropped faster than national averages. The city had more jobs last year — 741,200 — than at any time since 1990, despite the closures of Hahnemann University Hospital and the Philadelphia Energy Solutions refinery.
Since the coronavirus, though, nearly one in six state residents have filed for unemployment. Data aren’t available yet at the city level, but employers in Philadelphia laid off or reduced hours for thousands of workers in the last few weeks. Low-wage workers have been hit particularly hard.
Poverty remains an issue and this will likely make things worse.
Before the virus, Philadelphia still had the highest poverty rate of any large city, with 24.5%, or 380,000 people, living below the poverty line. An additional 86,000 people are living just above the poverty line. “They are particularly vulnerable as a result of what we’re going through,” Eichel said.
Philadelphia was also second only to Detroit in the percentage of residents paying more than 30% of their income on rent. The city has passed protections against eviction, but low-income renters will continue to face challenges during and after the pandemic.
Nationally, health experts have warned about an explosion of coronavirus cases in low-income minority communities.
Violent crime was on an upswing. The last two weeks have brought a temporary lull
Philadelphia’s homicide total last year was the highest since 2007. So far, it is 15% above where it was last year. Residents who moved out of Philadelphia cited public safety as a top reason in a survey Pew conducted last year.
Since the city is essentially shut down, there has been a decrease in violent crime, though shootings and homicides aren’t slowing at the same rate.
“Just because the homicide rate is running ahead year to date doesn’t mean it’s going to be higher,” Eichel said. “In the last several weeks, crime has declined — so ... all of that could change, at least for this year."
The report noted the connection between homicides and the city’s drug trade. About 1,100 people died of unintentional drug overdoses last year. That’s down from the peak of 1,217 in 2017, but unchanged from 2018 and remains one of the highest rates in the country. A plan to open a supervised injection site in South Philadelphia was swiftly killed by residents and concerned city leaders in February.
It’s hard to imagine post-pandemic city life, but many entrenched problems will remain, Eichel said.
“All of this, it’s still important because you know it reminds us of where we were and it helps focus attention on the long-standing issues that await the city once the current situation changes: crime, poverty, jobs.”