Hampton Roads More Broadly Affluent than NYC?

Unless you’re one of the 1%… OK, one of the 20%… you’re better off in Norfolk and New York.

Dr. James V. Koch, a professor of economics and former president of Old Dominion University, is back in the news  yet again, this time for making the seemingly outrageous observation that Hampton Roads is more affluent than New York City.

A few years ago, when he first discovered Hampton Roads’ relative affluence compared with New York, he told the Virginian-Pilot, he tried to interest a New York Times reporter in writing about it. The reporter declined, saying, “No one will believe it.”

Among cities in South Hampton Roads, the median household income in 2010 ranged from $42,700 in Norfolk to $67,900 in Chesapeake, according to the 13th annual State of the Region report, which Koch edited. That’s roughly comparable to $55,600 median income for New York City. (“Median” is the level at which half the population falls above that level and half above. It is not the same as the “average” or “mean,” which is skewed upward in New York by a small number of super-wealthy households.)

If you adjust incomes for the cost of living, it’s not even close: Hampton Roads stomps the Big Apple. The adjusted median is $51,600 versus  $40,600. (The national, cost of living-adjusted average is $51,900.)

“This is a result that might astonish the typical Gotham resident, to say nothing of The New York Times,” write Koch, “for it directly implies that the typical (50th percentile) household in our region is significantly better off, economically speaking, than the typical household in the New York metropolitan region.”

Hampton Roads has a broader middle-class than New York, with fewer poor people and fewer rich. The percentage of households making less than $25,000 a  year is 18.4% in Hampton Roads compared to 25.9% in NYC. Likewise, the percentage of households making $200,000 or more is 3.2% in Tidewater compared to 7.4% in New York.

A certain amount of income inequality is good, Koch says — high incomes are associated with wealth creation. That suggests there is a lot more wealth creation occurring in New York than in Hampton Roads. On the other hand, he noted, large gaps in income equality can undermine social cohesion, instill resentment and increase violence.

Writes the econ professor: “A small number of high incomes can push up the average income and, unless we look at the entire distribution of income, distort judgments about which state or region actually has the largest proportion of prosperous citizens. ”

Admittedly, New York City has sports teams, restaurants, museums and other cultural amenities that Hampton Roads lacks. Still, Koch says, “It is easy to support the assertion that the typical household in our region is better off, economically speaking, than the typical households in the New York City area.”

Lest those numbers “go to our heads,” Koch reminds his readers than median household income adjusted for the cost of living is 6.9% below that of Richmond and 34.3% below that of Northern Virginia. At least Hampton Roadsters can console themselves that their incomes are more equally distributed than those other areas, too.


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  1. doesn’t this imply that many Va urbanized areas are more “affluent” than NYC?

    doesn’t really pass the smell test, eh?

    what it probably is saying is that there are a lot of folks in NYC that are living at the margins… or perhaps living in rent-control or on public assistance?

    what’s the correct interpretation?

  2. DJRippert Avatar

    I question the use of household income. What is a household?

    If a single person is living alone in Manhattan and making $50,000 per year – is that a household? If so, is that person really less well off than a family of four making $55,000 in Tidewater?

    It would be interesting to see those same numbers on a per capita basis.

    I also question the use of city vs city comparisons. There is a whole lot of wealth in the suburbs of New York. Is that also true of Tidewater?

    It would be interesting to see those same numbers on an MSA basis.

    Finally, there are plenty of poor people in New York City. There are plenty of people in the lower middle class. The perception that everybody in New York is a wealthy resident of Manhattan is probably aided by TV and the movies.

  3. FreeDem Avatar

    There are more lower income people in a place like NYC because they see the metropolitan area as a land of opportunity, be they immigrants from abroad (an important factor to consider when comparing metropolitan economies) or low-skilled service workers.

    NYC has a higher cost of living, but it manages to carry on despite the rent being too damn high. Reminds me of the old saying about the restaurant that no one went to anymore because it was too crowded.

    Hampton Roads should be worried, not happy, about its status. It doesn’t seem to be attracting high income households who are part of the productive frontier of the economy, nor is it generating the large number of low-income service jobs that come with the new industries found in places like Silicon Valley or NYC. Instead it has a very middling profile. Manufacturing and military heavy. Lower on the totem pole for college educated workers. That may work when your entire economy is being propped up by the government , but it leaves you very vulnerable to shifts in spending.

    1. I more or less agree. I don’t see the ingredients for Hampton Roads to reinvent itself to be competitive in the knowledge economy if and when military spending goes into the tank. When the three pillars of your economy are the military, the ports and tourism, you’ve got a problem.

      Another challenge, which I’ll be highlighting in a blog post soon, will be the considerable cost to “harden” the coastline against (pick your phrase) rising sea levels or recurrent flooding. That necessity will drain public resources that could be applied elsewhere.

      On the other hand, Hampton Roads does have one tremendous gift — an extraordinary amount of coastline. People love the water. They love to look at it. They love to live near it. And they love to play in/on it. Just as Richmond is learning to capitalize on the James River, Hampton Roads has to figure out how to capitalize on its access to the ocean and the Bay.

      1. FreeDem Avatar

        The coastline is both a gift and a curse to Hampton Roads, as they to have the challenge of marshaling together resources to “harden” the coastline and the willpower to actually realize that it needs to be done.

        Can Hampton Roads learn to capitalize on its access to the ocean and the Bay? Maybe. But it’s also so developed, in some parts an archipelago of tiny Detroits, with its mess of highways and abandoned downtowns, and cheap suburban homes as a result of malinvestment in the last two decades, that I wonder if Hampton Roads in the metropolitan sense will be as appealing as other areas that have the coastline but not the dead end infrastructure.

        If Virginia is developing better infrastructure, rail and road, linking Northern Virginia, Richmond, and the urban Hampton Roads, doesn’t this also benefit the undeveloped coastal areas of Southside and the Chesapeake (Middle Peninsula and Northern Neck) as much, if not more, than Hampton Roads, when it comes to leveraging the ocean and the Bay? Worth thinking about.

  4. I think the Navy will always be there but perhaps a good vision if the military presence is not expanding is to ask what Hampton Roads would look like in a future without a big military presence and my view is that Hampton Roads is a COMPONENT of transportation network where the other parts are rail, truck and perhaps barge up the James.

    Of course this also brings up the issue of what exactly govt should or should involve itself with.

    For instance, is upgrading US 460 a legitimate function of government as an integral economic development complement to the Hampton Ports?

    Are the fates and fortunes of SW Va (and other regions) tied to what happens (or not) in Hampton?

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