AN OVERVIEW OF THE HUDSON VALLEY FROM THE GREAT RECESSION TO 2030
 
 

OVERVIEW

The Mid-Hudson Valley is at a crossroads. The aftermath of the Great Recession has shined a light on the region’s fault lines, and it reveals an economy and demographics that have moved out of alignment. While the Mid-Hudson Valley may appear to be thriving, a closer look shows several trends that jeopardize the region’s economic well-being. Given the challenges facing the Mid-Hudson Valley, there is no better time than now to plan for the future.

Nationally, the United States is in a period of unprecedented economic expansion. But that expansion has been uneven and the benefits not shared by everyone. Part of the reason is that the country has moved from a manufacturing to a service economy. The same can be said for the Mid-Hudson Valley.

Regionally, the misalignment between the economy and its demographics is of grave concern. Overall population growth is essentially flat, and in many areas is declining, dramatically impacting school enrollment. The rapid decline in K-12 population impacts not just our schools, but the availability of a homegrown workforce. The data reflects that the region is getting older, and people are having fewer children than needed to replace the population. Young working-age people, if given the opportunity, leave to seek employment elsewhere, and if they stay, are postponing the formation of families due to the cost of living. Furthermore, high-paying jobs lost in the last two decades have made way for low-skill, low-wage jobs often resulting in workers having to hold down two jobs just to balance their budget.

The ramifications of these trends are alarming.

 
 

Hear from Pattern President & CEO what it means to be “out of alignment” in the video below:

 
 
 

 WHat does it mean to be

out of alignment?

 
 
 
 
 
 
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being out of alignment

means that by 2028, public school enrollment is projected to decline by 25.8% since 2000/01, even as per pupil costs skyrocket amid disappointing outcomes. As a result, local school taxes will continue to rise, raising questions whether the current system of public education is sustainable.

 

being out of alignment

means that residents 55 and older are projected to become 35% of the population by 2030 - we have not yet made the necessary social and economic adjustments to prepare for a significantly older population.

 

being out of alignment

means that given the burden of college debt, lack of affordable housing, and the cost of childcare and health care, it is not surprising that 48% of the region’s 18-34 year-olds live with their parents. The national average is 34%.

 

being out of alignment

means that the jobs being created pay less than what it costs to live here. As many as 8,774 manufacturing jobs with an average salary of $70,000 were lost between 2000 and 2017. Meanwhile, 13,130 additional jobs were created in retail and the accommodation and food services sector, which have average wages of $30,000 and $21,000 respecitvely in 2017. As a result, at least a third of residents struggle to make ends meet.

 

being out of alignment

means that we have a housing crisis. There is a critical shortage of affordable housing due to a mismatch between the needs, the inventory, and what is being built. The unequal economic recovery has also resulted in a higher number of homeless.

 

PART ONE SUMMARY

An overview of the Mid-Hudson Valley from the Great Recession through 2030

This section contains a summary of the full report, available for download here.

 

 

population growth is stagnant

impact: Declining public school enrollment, a shrinking workforce, and fewer taxpayers

 

POPULATION CHANGE

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highlights:

  • The Cornell projection for the entire study area shows an increase of ONLY 2,403 or 0.2% by 2030, which is primarily fueled by Orange County

  • Much of Orange County’s growth can be attributed to the ultra-Orthodox Hasidic demographic, which will continue to become an even greater percentage of the county’s population

  • Columbia and Greene declined from 2000 to 2017, and will continue to fall under Cornell’s projection

  • Sullivan’s population increased, then declined. Cornell’s projection shows a continued decline

  • Putnam grew very modestly, and Cornell’s projection shows relatively little change

  • Ulster increased and then declined in the aftermath of the Great Recession. Cornell’s projection shows continued decline

 

number of births by county

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highlights:

  • Every county shows a decline in the number of births from 2007 to 2017

  • Putnam has the largest percentage decline in births, while Dutchess shows the greatest number decline

 

public school enrollment is rapidly declining

impact: Class sizes are shrinking, costs are rising, resulting in a decling homegrown workforce

 

student enrollment

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highlights:

  • Enrollment has steadily declined in each of the counties from 2000/01 to 2018/19 with a decline of 14.5% or 26,485 students

  • Columbia and Greene have seen the most dramatic decline as a percentage of enrollment

  • Each county is projected to lose more students from 2018/19 to 2028/29, the projected decline indicates another 13.2% reduction in enrollment in approximately hald the time than the period from 2000/01 to 2018/19

  • Overall the region will lose 25.8% from 2000/01 - 2028/29, according to Cornell’s projection

 

actual and projected enrollment decline from 2000/01 to 2028/29

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highlights:

  • between 2000/01 and 2028/29 Columbia (39%), Greene (36%) and Ulster (33%) are projected to lose a third or more of their student population. Sustained declines in enrollment, project a future loss of skilled workers and a significant impact on community college enrollment

  • Dutchess, Putnam, and Sullivan will lose 36% of their enrollment, while Orange will 19%

  • Total enrollment in the study area is projected to decline by 25.8% from 182,502 in 2000/01, to 135,446 in 2028/29

 

public school costs are increasing

impact: taxes will continue to rise and per pupil costs will climb further

 

county school data 2017/18

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HIGHLIGHTS:

  • The region spent several billion dollars on education, a majority of which goes to staff salaries and benefits, but student outcomes are poor

  • In 2017/18, only 15% of the region’s 8th graders met or exceeded state proficiency standards in Math and only 38% met the proficiency standard for English. Proficiency is considered met when students score at level 3 or 4 out of 4 possible levels

 

estimated annual cost per pupil in 2028/29 and % increase from 2018/19

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highlights:

  • The projected decline in enrollment will not lead to a commensurate reduction in per pupil costs due to legacy costs and increasing salaries and benefits

  • The average cost per pupil is projected to increase by $11,422 by 2028/29, unless school boards take proactive measures

  • Per pupil costs will range from a low of $36,185 in Dutchess to a high of $47,057 in Putnam

 

our communities are aging rapidly

impact: A reduced workforce and an increased demand for services, especially healthcare

 

AGE 55+ AS A % OF THE TOTAL COUNTY POPULATION

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Highlights:

  • By 2030, the 55+ age cohort is projected to increase dramatically in every county as the baby boomers continue to age

  • In six out of the seven counties (except Orange), people age 55+ made up 30% or more of the population in 2017

  • From 2000-2017 every county’s 55+ population grew

  • By 2030, 35% of the study area will be 55 and older, an increase of 17% since 2017

  • In Columbia and Greene more than 40% of the population will be age 55 and older by 2030

  • By 2030 almost 25% of Columbia will be age 70 or above

  • More than 10% of the study area’s population will be 75 and older by 2030

 

2017 Median Age by County

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Highlights:

  • Median age in six of the seven counties exceeds the New York State and United States averages, with the exception of Orange

  • Orange County’s median age is impacted by the residents of Kiryas Joel (with a median age of 13.8), one of the lowest of any municipality in the country

 

OUR COMMUNITIES ARE BECOMING MORE DIVERSE

Impact: As communities change different challenges are presented   

 

hispanic or latino - change in population 2000 to 2017 by ethnicity

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Highlights:

  • From 2000 to 2017, the Hispanic and Latino community has grown by 85.2% or an increase of 72,610

  • Non-Hispanic community declined by 1.4% during the same period

  • The biggest percentage increase came in Putnam where the Hispanic and Latino community grew by 129%

  • The biggest declines in the non-Hispanic population came in Putnam, Sullivan and Columbia

 

ULtra-orthodox - population density of kiryas joel as compared to orange county municipalities

Source: Census 2000, American Community Survey 2017

Source: Census 2000, American Community Survey 2017

POPULATION 2000

Kiryas Joel:           13,138

Orange County:   341,367

 

POPULATION 2017

Kiryas Joel: 22,794

Orange County:    378,174

Highlights:

  • Of the seven counties Orange grew the most between 2010 and 2017, Kiryas Joel accounted for 51% of that growth

  • The ultra-Orthodox Hasidic community has grown so rapidly that it has resulted in the creation of Palm Tree, New York’s first new town in 40 years

 

HIGHER PAYING JOBS DECLINED, LOWER WAGE JOBS increased

Impact: The middle class is shrinking

 

TOP 10: NUMBER OF JOBS BY INDUSTRY SECTOR and CORRESPONDING AVERAGE WAGES

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Highlights:

  • The largest number of jobs are in the government sector, which includes public education. The number of jobs in this sector has declined since 2008

  • Healthcare jobs grew the most since 2000 and at the fastest rate. All industries other than manufacturing and wholesale saw an increase in wages from 2000-2017

  • Retail jobs were stable and tourism related jobs grew, but both have average wages that cannot sustain a family

  • The 10 sectors above represent 84.8% of the region’s total workforce in 2017

 

UNEMPLOYMENT RATE

Source: NYS Department of Labor

Source: NYS Department of Labor

Highlights:

  • The current unemployment rate is comparable to the rate in 2000 and 2007, however now almost every sector of employment is struggling to find workers

  • Although unemployment rates are at pre-Great Recession levels, high paying jobs have declined and have been replaced with lower wage jobs

  • A new metric should be created that measures the number of jobs that offer a living wage rate

 

MEDIAN HOUSEHOLD INCOME HAS DECLINED

Impact: A growing number of people are finding it harder to live in the region

 

MEDIAN HOUSEHOLD INCOME 2010 AND 2017

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Highlights:

  • Incomes appear to have risen between 2010 and 2017, but when wages are adjusted for inflation, all but Greene County saw median incomes decline

 

poverty rates (individuals)

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Highlights:

  • Since 2000, Columbia, Dutchess, Orange and Ulster have seen their poverty rates steadily climb

  • Only Greene, Putnam and Sullivan have seen slight declines since 2010

  • Putnam has the lowest poverty rates in the region despite a slight uptick in 2010

 

OUR COST OF LIVING IS HIGHER THAN OTHER REGIONS

impact: We are at a competitive disadvantage

 

monthly costs for two adults and two children

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Highlights:

  • Our competition includes small metro areas in southern states 

  • The cost of living is lower in regions that are considered competitive in attracting a workforce

  • Danbury, an adjacent region to the study area, has a higher median income with a similar cost of living

  • The higher the percentage of median income to annual cost of living, the easier it is to live

 

childcare is prohibitively expensive

 

average childcare costs*,
one child in study area:

$10,549

family daycare

$13,456

daycare center

*maximum reimbursable

NYS infant care average annual cost:

$15,394

 

infant care costs for one child as part of a monthly budget:

20%

average childcare costs for two children in the study area:

$24,336

nys Ranks

6th

in the nation for most expensive infant care

 

Highlight:

  • The cost of childcare is the highest monthly cost item in the Mid-Hudson Valley. This is due to New York State having higher costs than other regions due to education and licensing requirements, lower provider-child ratios, and basic cost of operations

  • The cost of childcare imposes financial stress, reduces the workforce and impacts family size

 

housing is unaffordable

Impact: Housing consumes a large percentage of income and property taxes are high

 

% RENTER & OWNER OCCUPIED HOUSING WHO ARE COST BURDENED

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Highlights:

  • Orange has the highest percentage of renters and owners that are severely cost-burdened

  • Lack of resources for down payment and high student debt create barriers to entry for home ownership

  • Homelessness is also on the rise

 

property taxes in 2017

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Highlights:

  • Schools account for the largest share of property taxes

  • The rural counties of Sullivan and Greene have the smallest share of property taxes going towards schools

 

STUDENT DEBT HAS MORE THAN DOUBLED SINCE THE GREAT RECESSION

Impact: this lowers purchasing power, delays household formation and depresses the local economy

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% OF 18 TO 34 YEAR OLDS LIVING WITH PARENTS

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Highlights:

  • The percentage of 18-34 year-olds living with their parents in the study area in 2017 was 48%

  • In New York State, 40% live with their parents. US-wide, that number is 34%

  • Student debt is a contributor to the large percentage of those 18-34 year-olds living with their parents

 

TOURISM IS GROWING BUT DOES NOT OFFER A LIVING WAGE

impact: the industry provides large revenues to the region despite low wages for most employees

 

tourism spending

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Highlights:

  • Every county saw an increase in traveler spending, Ulster had the largest dollar increase ($156,000,000) and Columbia the largest percentage increase (52.2%)

 

% OF TOURISM JOBS AS A % OF TOTAL JOBS IN COUNTY

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Highlights:

  • Every county saw an increase in the percentage of jobs that are tourism related between 2010-2017

  • Tourism spending and its secondary impacts, such as the purchase of second homes and growth of new businesses linked to tourism, have been critical to the economy. The problem remains that the majority of tourism jobs created do not offer a living wage

  • Tourism sector jobs are typically covered by Accommodation & Food Services, Arts, Entertainment, & Recreation, and Retail Trade. Average annual wages in these sectors range from $20,000 to $30,000

 

 what’s next?

 
 

The tectonic plates have shifted, and are continuing to move further out of alignment.

whats next.jpg

The best time to plan is when you are not in crisis. While we are not forecasting when a recession will occur, a contraction has historically followed periods of economic expansion. It is harder to adjust to new realities during a period of contraction. The time to prepare for the future is now.


In the coming months, Pattern seeks input on issues such as:

  • How do we address the projected 25.8% decline in K-12 enrollment, the ever-increasing school property tax and the disappointing outcomes of student performance?

  • How do we attract higher paying jobs to make living in the Mid-Hudson Valley more affordable?

  • How do we attract and retain the 20-39 demographic?

  • How do we create housing that is affordable?

  • How do we refocus our resources to both provide for and integrate an aging population?

  • How do we plan for a region that is more diverse?


These and other questions need to be discussed now.