New Report Tracks Disappearance of Mid-Hudson Middle Class

Edited and packaged by Max Freebern

Median household income has declined as jobs leave the mid-Hudson Valley, according to the recently released “Out of Alignment” report by Hudson Valley Pattern for Progress (HVPP). 

Median household income represents the average amount of money earned in a household. The drop in income across the region was due to higher-paying jobs—in sectors such as finance, manufacturing, education and information services—  leaving the area. The mid-Hudson Valley has seen lower-paying jobs—such as occupations in food, administration and waste services— come into the area. These lower-paying occupations often pay less than the cost of living, according to the report.

“[The report] is meant to be a call to action,” said Jonathan Drapkin, the president and CEO of HVPP. “Strategies, recommendations and suggested actions will be contained in the second part of the report to be released in the beginning of the [new] year.”

According to the HVPP website, the group’s mission is to “promote regional, balanced and sustainable solutions that enhance the growth and vitality of the Hudson Valley.”

The report collected data from Columbia, Dutchess, Greene, Orange, Putnam, Sullivan and Ulster counties which, except for Greene County, have all seen their median household income decline since 2010. 

Median Household Income in Dollars from 2010 and 2017

Median household income in Ulster County dropped from $64,714 in 2010 to $61,652 in 2017, when the numbers were adjusted for inflation. Greene County was the only county in the Mid-Hudson Valley whose median household income actually increased, jumping from $51,960 in 2010 to $53,214 in 2017, when adjusted for inflation.

The decline in median household income in the mid-Hudson Valley is representative of a national middle class that is shrinking, losing purchasing power and has a growing disparity between the wealthiest and poorest households. This affects middle class and poor households’ ability to achieve economic independence.

The labor force participation rate (LPFR) has also declined in every county in the Mid-Hudson Valley from 2000 to 2017. The LPFR counts people who are currently employed or actively looking for work. This fact  holds true even though the number of people who were employed or looking for employment grew by 21,400. Greene County’s rate of people employed or seeking employment in 2017 was 62.1% compared to 64.8% in 2012 and 71.2% in 2000. Columbia County’s rate of people employed or seeking employment in 2017 was 50.4% compared to 52.5% in 2012 and 58.7% in 2000.

Labor Force Participation Rate(%): Mid-Hudson Valley

The average labor force participation rate across all counties was 59.3% in 2017, a 4.1%  decrease from 2000 to 2017 where the average labor force participation rate was 63.4% in 2000 and 61.2% in 2012. 

The study also found that due to the area’s close proximity to New York City, housing, food, transportation, childcare and healthcare was more expensive. The report also notes that the area’s high cost of living— including taxes, housing costs and childcare— was almost twice as expensive as comparative areas.

The annual cost of living in Orange County and Dutchess was $117,804 and $109,764 in Ulster County compared to just $79,228 in the Nashville, Tenn. metro area and $81,291 in the Charleston, SC metro area. Median household income in Ulster County was $61,652 compared to $89,773 in the Danbury, Conn. metro area.

Annual Cost of Living in Dollars for Two Adults and Two Children

While median household income and labor force participation declined, poverty rates rose in the majority of the counties in the Mid-Hudson Valley.  

Columbia, Dutchess, Orange and Ulster counties have seen poverty rates rise since 2010 while Greene, Putnam and Sullivan Counties have seen poverty rates decline from between .8% to as much as 2.2%.

Poverty rates in Ulster County rose from 11.3% in 2010 to 13.2% in 2017. Poverty rates in Columbia County rose from 9.5% in 2010 to 11.4% in 2017. New York State’s poverty rate rose from 14.2% in 2010 to 15.1% in 2017. New York State’s poverty rate was also at 15.1% back in 2000.

Poverty Rates by County (% of individuals)

Greene County saw its poverty rates decline from 13.2% in 2010 to 12.4% in 2017. Putnam County saw the most drastic decline as poverty rates dropped from 7.0% in 2010 to 4.8% in 2017.

According to the ‘Out of Alignment’ report, to counteract these trends, the Mid-Hudson Valley’s public officials “must work hard to diversify and strengthen our economy and change how we live so that we can secure the future while retaining the sense of place that makes the mid-Hudson Valley such an attractive area to live.”

“We’re committed to growing the mid-Hudson’s economy in a way that enhances opportunities for all residents and ensures everyone benefits from the region’s success,” said Adam Kilduff, a spokesman for Empire State Development, responding to questions via email.

Kilduff added that the improvements the mid-Hudson Valley have made include statewide efforts to improve training programs. Private sector jobs increased by over 10% since 2011 and gross domestic product, a measure of productivity for the mid-Hudson Valley, has increased by over 26% since 2011 and is currently at $157 billion.

The 26% growth rate however was smaller compared to previous periods such as between 1991 and 2001 where economic output increased by over 42% and between 1982 and 1990 where economic output increased by 38%. The economic output in those periods was significantly smaller than the 52% increase seen between 1961 and 1969.       

“New York State is narrowing the opportunity gap through the creation of new jobs with good salaries and a robust $175 million workforce development initiative to make sure today’s workers are equipped with the skills required for the jobs of tomorrow,” Kilduff. He referred to the Workforce Development Initiative launched by New York State that helps people find jobs and develop skills to advance their careers.

The decline in median household income in the mid-Hudson Valley is representative of a national middle class that is shrinking and losing purchasing power, stunting their ability to achieve economic independence

According to Kilduff, Empire State Development wants to see economic growth  reach everyone and is working with economic and workforce development partners, like the Orange County Partnership and the Business Council of Westchester, to help improve median wages and reduce poverty rates throughout the mid-Hudson Valley.

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