THE CHARACTERISTICS OF DECLINING NEIGHBOURHOODS IN TORONTO

Transcription

1 THE CHARACTERISTICS OF DECLINING NEIGHBOURHOODS IN TORONTO by Kris Nelson Submitted in partial fulfilment of the requirements for the degree of Master of Urban and Regional Planning at Queen s University Kingston, Ontario April 2012 Copyright Kris Nelson 2012

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3 ABSTRACT This report explores relative changes taking place in the lowest- income neighbourhoods in the Toronto CMA between 1981 and Through analysis of census data, three categories were created to trace change in demographic and housing stock characteristics, along with spatial patterns in the lowest- income neighbourhoods over the 25- year period. The three neighbourhood categories explored were: 1) neighbourhoods that declined into the lowest- income decile; 2) neighbourhoods that increased from the lowest- income decile; and 3) neighbourhoods that remained in the lowest- income decile. Neighbourhoods that declined into and remained in the lowest- income decile were found to be spatially concentrated in the inners suburbs, while neighbourhoods that increased from the lowest- income decile were concentrated in the inner city. Characteristic profiles show that neighbourhoods that declined into and remained in the lowest- income decile experienced reduced labour market participation, despite substantial increases in educational achievement. Additionally, a deteriorating housing stock that was predominately constructed between 1946 and 1970 was prevalent in neighbourhoods that declined into or remained in the lowest decile. The relative income decline of neighbourhoods to the lowest decile was found to be mainly a private market phenomenon as low- income households were pushed out to spatially isolated inner suburbs. i

4 ACKNOWLEDGEMENTS A special thanks to my supervisor Andrejs Skaburskis for his continual guidance and insight throughout the writing of this report. I would also like to thank Anthony Hommik for is attention to detail and willingness to review and edit this report despite his heavy workload. Finally, I am forever grateful to my fiancé Kellie who has provided unwavering support and enthusiasm throughout our Kingston journey. ii

5 TABLE OF CONTENTS Chapter 1: Introduction Research Questions Structure of Report... 2 Chapter 2: Literature Review The Importance of Neighbourhoods Neighbourhood Change Factors of Neighbourhood Change Theories of Neighbourhood Change Summary...14 Chapter 3: The Method The Quantitative Approach The Spatial Approach The Qualitative Approach Summary Chapter 4: Quantitative and Spatial Analysis Relative Neighbourhood Change Matrix Spatial Analysis Descriptive Statistics Summary Chapter 5: Qualitative Analysis Interview Themes Summary...45 Chapter 6: Conclusions and Discussion Key Findings Discussion...49 References Appendix A: Demographic and Housing Stock Tables Absolute Figures Appendix B: Interview Guide iii

6 LIST OF TABLES TABLE 1: RELATIVE NEIGHBOURHOOD CHANGE MATRIX: 1981 TO TABLE 2: PROPORTIONATE CHANGES IN HOUSEHOLD CHARACTERISTICS: 1981 TO TABLE 3: PROPORTIONATE CHANGES IN EMPLOYMENT ACTIVITY: 1981 TO TABLE 4: PROPORTIONATE CHANGES IN HOUSING STOCK TENURE AND TYPE: 1981 TO TABLE 5: PROPORTIONATE CHANGES IN HOUSING COSTS: 1981 TO 2006 ($ 2006) TABLE 6: PROPORTIONATE CHANGES IN HOUSING STOCK CONDITION AND AGE: 1981 TO List of Figures FIGURE 1: SPATIAL DISTRIBUTION OF THREE NEIGHBOURHOOD CATEGORIES FIGURE 2: SPATIAL DISTRIBUTION OF NEIGHBOURHOODS THAT DECREASED INTO LOWEST DECILE FIGURE 3: SPATIAL DISTRIBUTION OF NEIGHBOURHOODS THAT INCREASED FROM LOWEST DECILE.. 24 FIGURE 4: DISTANCE FROM CENTRE OF CITY RELATIVE TO CHANGE IN AVERAGE ADJUSTED HOUSEHOLD INCOME: 1981 TO FIGURE 5: HEAD OF HOUSEHOLD INCOME AFTER TAXES BY PERIOD OF CONSTRUCTION: 1981 AND iv

7 CHAPTER 1: INTRODUCTION The effect a neighbourhood environment can have on the wellbeing of households has long been recognized. Individual outcomes, such as health, educational achievement and employment opportunities are not only shaped by household characteristics, but also by the characteristics of one s neighbourhood (Ellen and Turner, 1997). It is also clear that neighbourhoods are not static entities; they frequently experience physical, social and demographic changes that result in their relative decline or improvement. Initially, affluent households lived in what are now inner city neighbourhoods but with advancements in transportation technology they tended to move outward in most North American cities (Burgess 1925; Hoyt 1939). This led to the relative decline of inner city neighbourhoods and the evolution of a significant dichotomy between the inner city and the suburbs. However, the urban spatial structure of cities is constantly evolving. Recent trends indicate that suburban neighbourhoods are not immune to decline (Lucy and Phillips 2000) and that the gentrification of inner city neighbourhoods is expanding (Meligrana and Skaburskis 2005). Accordingly, understanding determinants of neighbourhood change and associated spatial patterns is crucial for planners to assemble well- informed policies that lead to improved outcomes for households. This report examines changes taking place in the lowest- income neighbourhoods in the Toronto Census Metropolitan Area (CMA) between 1981 and

8 1.1 Research Questions Characteristics and spatial patterns of the lowest- income neighbourhoods in Toronto will be described but the focus of this report is on neighbourhoods that dropped to the lowest- income decile between the 1981 and 2006 censuses. Determinants for their relative neighbourhood income decline will also be explored. To accomplish this, the following research questions are addressed: 1. What are the housing and demographic characteristics of the lowest- income neighbourhoods? 2. How have these characteristics changed over the 25- year period? 3. Where are these neighbourhoods located within Toronto? 4. What explains the location of the declining income neighbourhoods? 5. What factors brought about the changes? 1.2 Structure of Report This report is divided into five chapters. Chapter two will briefly cover literature relevant to neighbourhood change and urban spatial patterns. A comprehensive review of the methodology employed in the report is offered in Chapter three. Quantitative and qualitative analysis is refined and summarized in chapters four and five. Lastly, the report will offer conclusions from the findings and a discussion around policy options. 2

9 CHAPTER 2: LITERATURE REVIEW The purpose of this section is to explore literature pertaining to neighbourhood change and urban spatial patterns. Initially, we ask why neighbourhoods matter? Next, the notion of neighbourhood change and how it is typically viewed in the literature will be discussed. Factors believed to contribute to neighbourhood income decline will be reviewed in the following section, while spatial patterns of neighbourhood change are offered as a continuous thread throughout the chapter. Lastly, a theoretical prospective will be provided through the review of some principal urban spatial theories. 2.1 The Importance of Neighbourhoods Literature suggests that the wellbeing of households is impacted by neighbourhood characteristics. The empirical evidence exploring the effect of neighbourhood conditions on adolescents indicates that individual academic achievement, future employment opportunities, and the propensity to participate in criminal activity are influenced by neighbourhood characteristics (Ellen and Turner, 1997). But how do neighbourhoods actually influence residents opportunity structure? Casual mechanisms that connect neighbourhood change to the opportunity structure of individual residents are offered in the literature (Galster et al.2008; Ellen and Turner 1997). For instance, the socialization mechanism postulates that behaviours and attitudes of individuals are changed through contact with peers. In the absence of positive role models, which may be the case in neighbourhoods described by high 3

10 levels of poverty, unemployment, and crime rates, individuals become isolated and lack the opportunity to emulate those with experience in dealing with such constraints as temporary unemployment (Galster et al.2008). Another mechanism proposes that communication with friends, colleagues and acquaintances operates as the conduit to allow information and resources to flow into the neighbourhood (Galster et al.2008). However, if social networks become weakened through isolation, preventing information and resources to flow seamlessly, prospects for future opportunities become diminished. This can be particularly true in the labour market (Wilson 1999). 2.2 Neighbourhood Change Urban theory traditionally views neighbourhood change through the socioeconomic transformation of residents, observing changes in those who move in and those who move out (Smith et al. 2001). For example, neighbourhood decline can be described through the deterioration of one s social environment (Grisby et al. 1987), while gentrification is described as an upward movement in the social status of a census tract (Ley 1993, p. 232). Socioeconomic indicators such as, personal and household income, employment and educational achievement levels are commonly used to trace socioeconomic changes of residents within neighbourhoods (Meligrana and Skaburskis 2005; Galster et al. 2008; Hulchanski 2007 and 2010). More comprehensive definitions of neighbourhood change expand to include a physical dimension. Disinvestment in the capital stock, building abandonment, and the intrusion of 4

11 incompatible land uses, reflect the physical realities of neighbourhood decline (Grisby et al. 1987), whereas the reinvestment of capital is viewed as a key aspect of gentrification (Davidson and Lee 2005). Similar to socioeconomic indicators, physical indicators such as the age, type and condition of the housing stock are routinely traced to track neighbourhood change (Meligrana and Skaburskis 2005; Galster et al. 2008). Although the term decline is typically understood in a negative context, it must be stressed that neighbourhood decline should not always be viewed in this manner (Grigsby et al. 1987). Transformation of a neighbourhood to a lower socioeconomic status may improve individual outcomes of many within the neighbourhood, which is not always reflected in the data. 2.3 Factors of Neighbourhood Change There are undoubtedly numerous factors that continually morph neighbourhoods. A few of the most relevant factors to this report will be discussed and include the concentration of poverty, unemployment, and net depreciation of the housing stock. Although all of these factors will be examined in isolation, it is not uncommon for these factors to work simultaneously and it is not without debate as to which factor is dominant (Grigsby et al.1987) Concentrated Poverty Recent research has examined the relationship between the concentration of poverty and the social harms created through neighbourhood mechanisms. Galster et 5

12 al. (2008) and Quercia and Galster (2000) believe the relationship is not linear and that once a threshold is exceeded, social harms disproportionately increase relative to poverty levels, expediting neighbourhood decline. Galster et al. (2008) found that a threshold level does in fact exist when comparing housing values to the concentration of poverty at the census tract level for the largest 100 metropolitan areas in the United States between 1990 and These findings are in line with other empirical studies, which have also found nonlinear relationships that exist at the neighbourhood level (Vartanian 1999; Weinberg et al. 2004). Understanding if threshold levels exist is definitely significant for planners, but is substantially more relevant once the causes of concentrated poverty are understood. Jargowsky (2002) argues that poverty concentration is the result of spatial restructuring. The exodus of affluent households and jobs from the inner city to the periphery has left low- income households spatially and socially isolated. As a result, spatial mismatches between jobs and low- income households are created and exacerbated by mobility constraints (Jargowsky 2002). Recent empirical studies indicate that spatial socioeconomic segregation continues but is increasingly concentrated in the inner suburbs of cities. Lee and Leigh (2007) examined socioeconomic disparity between the downtown, the inner city, inner- ring suburbs, and outer- ring suburbs in Atlanta, Cleveland, Philadelphia, and Portland, Oregon from 1970 to Their findings indicate that the 6

13 inner suburbs experienced higher levels of distress, defined by higher rates of unemployment, welfare recipients, and poverty. Contrastingly, socioeconomic improvements were found in the downtown and inner city, which previously experienced extended periods of distress (Lee and Leigh 2007). Studies conducted in a local context have found parallel spatial patterns. Through the comparison of Toronto census data between 1970 and 2005, Hulchanski (2007 and 2010) found significant income polarization and spatial segregation between three distinct income groups. The most affluent group was geographically concentrated along the north- south and east- west subway lines within close proximity to many of the city s amenities. In complete contrast, the lowest- income group was mainly concentrated in the inner suburbs. Consequently, this group was not within close proximity to amenities and were required to travel further on average to access public transportation. Alarmingly, over half of the neighbourhoods within Toronto are part of this group, which has been disproportionately growing since Much of this growth has come at the expense of the middle- class, which has continually shrunk (Hulchanski 2007 and 2010). A recent report completed by the United Way Toronto, stresses similar results. The report found poverty to be disproportionately located in the city s inner suburbs and increasingly concentrated in high- rise buildings (MacDonnell et al. 2011). Such studies point to the spatial consequences of socioeconomic sorting across an urban landscape. Spatial segregation of low- income households leads to the concentration of poverty and 7

14 spatial mismatches between low- income households, employment opportunities and/or amenities Unemployment In his seminal book, When Work Disappears, Wilson (1996) argues that a neighbourhood in which people are poor, but employed, is very different from a neighbourhood in which people are poor and jobless (p. xiii). It is clear that unemployment and poverty are positively associated, and the restructuring of cities has significant impacts on the accessibility and availability of jobs. Economic restructuring over the past few decades has led to a precipitous decline in low- skill, high- paying jobs, creating an educational and training gap that has resulted in significant increases in unemployment (Wilson, 1996). Through an in depth study of 12 low- income neighbourhoods in England and Wales, Lupton (2003) discovered a similar divergence in the labour market as a result of restructuring of the British Economy. In a recent Canadian study, Chen et al. (2012) found unemployment to be higher in lower- income neighbourhoods; however, they also found that the concentration of unemployment did not increase in lower- income neighbourhoods despite structural changes in the economy. Instead, residents in low- income neighbourhoods generated significantly less earnings from the jobs they held (Chen et al. 2012). Likewise, Stapleton et al. (2012) found the working poor in Toronto were disproportionately employed in the sales and service industry, which tends not to provide high wages, and were disproportionately represented by new immigrants. 8

15 These results were found despite the working poor achieving similar levels of education to municipal averages. Similar economic arguments have been used to describe the process of gentrification. Ley (1988 and 1994) and Rose (1984) suggest the spatial reconfiguration of the labour market has led to a disproportionate increase in the number of highly skilled jobs. These tend to be heavily urbanized roles, such as management and professionals, increasing consumer demand for inner city living. The burgeoning division in the labour market due to structural changes in the economy has significant implications on employment opportunities for residents and the spatial patterns of neighbourhood decline Net Depreciation of the Housing Stock Theory suggests that resources must be sunk back into residential structures in the form of repairs and maintenance to overcome continual depreciation and to keep the capital stock constant (Galster et al. 2008). As such, depreciation of the housing stock presents homeowners with one of two choices: continually invest to ensure the capital stock remains constant, or forego maintenance, leading to a state of disinvestment and a net depreciation in the capital stock. Lucy and Phillips (2000) infer from their findings that characteristics of a neighbourhoods housing stock determine whether or not such disinvestment will occur. The type and size of housing found in neighbourhoods, along with the location of the neighbourhood influences investment flows. Housing built in the inner suburbs between 1946 and 1970 is outdated and is typically situated in locations that are inconvenient and lack 9

16 amenities such as public transit. Consequently, consumers prefer housing in other locations leading to a state of disinvestment in the housing stock in the inner suburbs (Lucy and Phillips 2000). However, Smith et al. (2001) assert that changes in consumer preference are not the primary force behind neighbourhood decline. Instead, it is the withdrawal of capital by developers, financial institutions and other actors that initiate neighbourhood decline and guide locational decisions made by consumers. Smith (1979) applies similar logic to the process of gentrification. He claims that opportunities for profit are born through the disparity between the potential value of land and its current value, which he coined as the rent gap. Disinvestment and deterioration of the housing stock within the inner city creates a division between the capitalized land rent and the potential profit that could be received from redevelopment of the land to its highest and best use. As the disparity widens, capital is attracted back into the inner city in recognition that profits can be made. Other theories explaining neighbourhood decline suggest that the decrease in housing stock quality is not a necessary condition for decline to occur. Grigsby et al. (1987) argue that a downward shift in the relative income levels of residents can occur without a shift in housing prices and housing quality. Labelled as the succession concept, it focuses solely on the shift of income levels within a neighbourhood. The succession concept postulates that many factors impact 10

17 households and other actors in the housing market to make different decisions regarding maintenance and upgrading along with moving decisions (Grigsby et al p. 20). These decisions generate changes to neighbourhood characteristics and result in some neighbourhoods becoming relatively less attractive compared to others. This leads to the geographical separation of neighbourhoods based on income levels and the relative decline of certain neighbourhoods. 2.4 Theories of Neighbourhood Change There are many urban spatial theories that attempt to establish a framework for how cities are structured and how they change over time. Since the 1920 s, the majority of these theories have been rooted in one of two distinct schools of thought social ecology or urban economics (Alonso, 1964). The following section will draw upon principal theories from these schools of thought to provide the reader with a flavour of the theoretical literature and to create a theoretical basis to interpret changes being observed in the report Sector Model In his book, The Structure and Growth of Residential Neighborhoods in American Cities (1939), Homer Hoyt proposed the sector model. Hoyt refutes one of the first urban ecological models proposed by Burgess (1925), which claimed outward city growth occurs in concentric rings due to the expansion of the central business district (Pitkin 2001). Instead, Hoyt argues that city growth is directed towards high 11

18 rent sectors, or neighbourhoods, within the city. Affluent residents build new houses on the periphery of these high rent sectors rather than invest in upgrading their older houses. This prompts what is known as the filtering process. Once the affluent residents relocate to the urban fringe, middle- class residents move into houses vacated by the affluent and lower- income residents move into the houses previously occupied by the middle- class. Hoyt (1939) shows that this process is mainly driven by population growth and highlights the increased demand for housing by newcomers does not only lead to quantitative affects in the housing stock but also qualitative ones as the older housing is filtered down to lower income households. Thus, the decline in the income level in a neighbourhood is brought about by the natural aging of the housing stock and the disinvestment by homeowners. Hoyt also considers this process to be mainly unidirectional, as [t]he wealthy seldom reverse their steps and move backward into the obsolete houses which they are giving up (Hoyt 1939 p. 116) Neo- classical Economic Model The Alonso- Mills- Muth models of the 1960s provide the basis for the neoclassical explanations of urban structure and its changes (Anas et al. 1998). The neoclassical models propose that residents balance the benefits of more space and cheaper land on the periphery with the cost and inconvenience associated with longer commutes (Alonso 1964). For example, a household located a longer distance from the central business district experiences a higher commute cost than one living closer to the 12

19 centre of employment and will therefore be inclined to bid less for the location. Households with a demand for larger houses on larger lots will be willing to pay more for their commutes to gain the lower per- square- metre price of land and housing. Since the higher income households have a higher demand for housing, they would gain the most by the lower prices at the periphery. With rising incomes, while everything else remains constant, the growth occurs at the periphery and higher income households follow the trajectory explained earlier by Burgess (1925) and Hoyt (1939). Although the neoclassical model is built on a set of simplistic assumptions, it sheds light on the decentralization of the urban core experienced by most cities across the world in the past century and a half (Anas et al. 1998). The decline of neighbourhoods located closer to the centre of the city is the by- product of middle- and higher- income residents moving to the urban edge once the benefits of more land outweigh the costs of commuting. These models help clarify the paradox of lower- income households living on more expensive land in the inner city while more affluent households reside on lower priced land near the periphery (Meligrana and Skaburskis 2005). Both the neoclassical and the sector model describe the decentralization of the urban core. However, both models fail to explain the back to the city movement seen in many metropolitan areas through the process of gentrification. 13

20 2.5 Summary A review of current literature indicates that the wellbeing of residents is impacted by neighbourhood characteristics. Factors such as economic restructuring and disinvestment influence changes in the demographic and housing stock characteristics of neighbourhoods. Recent studies indicate that spatial patterns of relative neighbourhood decline are shifting to the inner suburbs. These neighbourhoods tend to be spatially isolated, possess a built form that is outdated and buildings that have become functionally obsolete from many points of view. This can create significant challenges for planners as low- income residents are shifted into these neighbourhoods. 14

21 CHAPTER 3: THE METHOD This report examines neighbourhood change in the Toronto CMA from 1981 to The geographical scope was set to 1981 census boundaries for the Toronto CMA as it provided a fixed regional context and a base period for neighbourhood change to be traced (Meligrana and Skaburskis 2005). The 25- year period offered a sufficient length of time to yield observable and measurable changes (Hulchanski 2007 and 2010; Galster et al. 1997; Jargowsky 2002), while the 2006 census represented the most up- to- date data during the preparation of the report. A three- step process was utilized in the report. The first step involved a quantitative approach and included identification of low- income neighbourhoods and use of descriptive statistics to summarize their demographic and housing stock characteristics. The second step included mapping the lowest- income neighbourhoods for observation of spatial patterns. In the last step, key informant interviews were conducted to determine causes of the neighbourhood changes observed. The following sections discuss each of these three steps in more detail. 3.1 The Quantitative Approach How one defines the boundaries of their neighbourhood is a subjective process based on individual perspectives (Galster 2001; Hulchanski 2007 and 2010). This can make measuring neighbourhood change extremely difficult. Statistics Canada defines neighbourhoods roughly through census tracts, which are typically stable areas with 15

22 a population between 2,500 and 8,000 with similar socioeconomic characteristics (Statistics Canada 2012). As such, census tracts provide a reasonable surrogate for neighbourhoods in this report (Meligrana and Skaburskis 2005; Hulchanski 2007 and 2010) and the term census tract is treated synonymously with the term neighbourhood. There are some limitations when using census tract data to trace neighbourhood change over time. Tract boundaries are routinely changed by Statistics Canada as population levels increase or decrease (Statistics Canada 2012). Accordingly, tract boundaries that change from the base period must be adjusted to establish geographical areas that are comparable (Skaburskis forthcoming; Meligrana and Skaburskis 2005; Galster et al. 1997). In this case, 2006 census tract boundaries were altered to mimic the 1981 boundaries. The Toronto CMA consisted of 608 census tracts in 1981, with data available for 585. Each of these tracts symbolizes the unit of analysis for the report Relative Neighbourhood Change and Low- Income Neighbourhood Identification Relative comparisons are useful when exploring neighbourhood change as they illustrate how neighbourhoods match up against one another and how this has changed over time (Hulchanski 2007 and 2010). To establish a mechanism for evaluating relative neighbourhood change and ultimately identify low- income neighbourhoods, the 585 neighbourhoods were divided into deciles (i.e., 10 equal 16

23 segments) based on average adjusted household income (AAHI) in 1981 and in Change in AAHI between 1981 and 2006 reflects the shifting of neighbourhoods relative to one another over the 25- year period, as displayed in Table 1. Relative Neighbourhood Change Matrix: 1981 to The use of deciles was a subjective procedure, but provided an angle of depth that would not be offered if broader divisions, such as quartiles, were used. Each decile still represented a significant number of neighbourhoods (n = 58 or 59), allowing for recognition of trends and patterns of change; however, each decile was small enough to be manageable. Table 1: Relative Neighbourhood Change Matrix: 1981 to 2006 Average Adjusted Household Income 1981 Average Adjusted Household Income 2006 Deciles Total Total Declined into the Lowest Decile Remained in the Lowest Decile Increased From the Lowest Decile Other 17

24 3.1.2 Average Adjusted Household Income Average adjusted household income was selected as the proxy for neighbourhood change as it partially accounts for household size by dividing average household income by the square root of average household size (Atkinson 2002). Although most studies use personal income as a proxy for social change, the demand for housing is established by household income. However, there are also limitations to solely using household income as a proxy for social change. For instance, if a single, young professional displaces multiple low- income earners, then household income could drop, resulting in neighbourhood income decline and an underestimation in the social change that took place (Skaburskis forthcoming). Lastly, average household income, opposed to median was used, as it is more responsive to income extremes that may persist within neighbourhoods (Hulchanski 2007 and 2010). As such, use of average adjusted household income as the proxy for neighbourhood change helps reduce limitations of solely using household income or personal income Low- Income Neighbourhood Categories Each of the 585 census tracts could have experienced one of three possible relative income change outcomes over the 25- year period. Their income could have declined, increased or remained unchanged relative to other neighbourhoods. As such, three categories were created using Stata statistical software to explore the lowest- income neighbourhoods: 1) neighbourhoods that declined into the lowest decile; 2) neighbourhoods that increased from the lowest decile; and 3) neighbourhoods that 18

25 remained in the lowest decile. The distribution of these three neighbourhood categories is highlighted in Table Descriptive Statistics Descriptive statistics are used to provide simple summaries of data, allowing for basic quantitative analysis. Data compiled for the three neighbourhood categories and the CMA was drawn from literature on neighbourhood change, and included demographic and housing stock characteristics (Galster et al. 1997; Meligrana and Skaburskis 2005; Hulchanski 2007 and 2010). Once these categories were compiled, analysis was preformed to trace change in each characteristic over the 25- year period. 3.2 The Spatial Approach Utilizing 1981 Toronto CMA boundaries, the three neighbourhood categories were mapped using ArcMap Geographic Information System. The maps focus on the current City of Toronto boundaries as 98 per cent of the neighbourhoods in the three categories were located within these boundaries. 3.3 The Qualitative Approach Six key informant interviews were conducted over a two- week period with professional planners, academics, and neighbourhood- based researchers who possess intimate knowledge of neighbourhood change in Toronto. The interviews 19

26 were semi- structured and an interview guide (refer to Appendix B) with a list of themes along with related questions were used in all interviews (Kvale 1996). This provided some structure to the interviews to ensure basically the same information was covered, but provided freedom to build conversation, ask spontaneous questions and to gain more knowledge in a particular area (Patton 1990). The interview guide also functioned as an outline, making data collection more systematic and efficient (Patton 1990). The primary purpose of conducting key informant interviews was to understand the factors driving neighbourhood change. Secondly, key informant interviews reduced the limitations of solely relying on quantitative analysis (Meligrana and Skaburskis 2005). Lastly, experts were asked to identify implications for professional planners and potential solutions that could be pursued. 3.4 Summary To adequately address the research questions a mixed method approach was employed in the report. Quantitative methods were used to trace relative neighbourhood change over a 25- year period, identify the lowest- income neighbourhoods in the Toronto CMA and to explore characteristics of three neighbourhood categories. Observation of spatial patterns was completed through mapping of neighbourhood categories, while interviews were conducted to realize the determinants of neighbourhood change observed. Results from these methods are discussed in the following chapters. 20

27 CHAPTER 4: QUANTITATIVE AND SPATIAL ANALYSIS The following chapter is divided into three sections. The first section reviews the Relative Neighbourhood Change Matrix: 1981 to 2006, and highlights some general observations. The second section analyzes the spatial distribution of the three neighbourhood categories while the final section presents descriptive statistics for the three neighbourhood categories and the CMA. 4.1 Relative Neighbourhood Change Matrix The Relative Neighbourhood Change Matrix: 1981 to 2006 (refer back to Table 1) displays relative neighbourhood change based on adjusted average household income (AAHI) over a 25- year period. Prior to focusing on the three neighbourhood categories, it is worthwhile highlighting a couple of general observations that appear in the Matrix. First, the distribution of neighbourhood change is relatively symmetrical and appears well distributed across the Matrix, indicating widespread changes have occurred in many neighbourhoods. That being said, many neighbourhoods remained relatively unchanged over the time period, as is displayed along the central diagonal. This is most noticeable on the extreme ends of the Matrix, with 44 neighbourhoods unchanged in the top decile, retaining the highest AAHI, and 26 neighbourhoods unchanged in the lowest decile. Secondly, the Matrix illustrates that more neighbourhoods have relatively declined than have increased. Forty per cent of the neighbourhoods in the report experienced a relative decline, while 33 per cent experienced an increase and the remaining 27 per cent remained relatively 21

28 unchanged. These observations are perhaps reflective of labour market changes due to economic restructuring (Wilson 1996; Chen et al. 2012) and trends of income polarization within Toronto, which have left more households worse off (Hulchanski 2007 and 2010). The three neighbourhood categories consisted of 116 neighbourhoods (refer back to Table 1). Twenty- six of these neighbourhoods remained in the lowest decile over the 25- year period, while 32 declined into and 32 increased from the lowest decile. The distribution of neighbourhoods that declined into and increased from the lowest decile was fairly similar outside of one outlier that increased eight deciles. The majority of the neighbourhoods declined or increased three or less deciles, which was similar to the neighbourhood change observed in the other deciles (i.e., 1 through 9). 4.2 Spatial Analysis The spatial distribution of the three neighbourhood categories presents some obvious patterns. First, 98 per cent of the neighbourhoods within the three categories were located within the City of Toronto. As such, the spatial analysis was narrowed to the City of Toronto to focus the comparisons, as displayed in Figure 1. Second, neighbourhoods that declined into the lowest decile and neighbourhoods that increased from the lowest decile had two distinctly opposite spatial patterns, as shown in isolation in Figures 2 and 3. Neighbourhoods that declined into the lowest 22

29 Figure 1: Spatial Distribution of Three Neighbourhood Categories decile were located outside of the inner city (defined as the former City of Toronto ), and all but two were located in the inner suburbs (defined as the other former municipalities i.e., Etobicoke, York, East York, North York, and Scarborough). This spatial pattern is supported by a growing body of literature which has found neighbourhood income decline to be spatially concentrated within inner suburbs (Hulchanski 2007 and 2010; Macdonnell et al. 2011; Lee and Leigh 2007). On the contrary, neighbourhoods that increased from the lowest decile were overwhelmingly (75 per cent) located within the inner city. This pattern questions key urban spatial theories that postulate neighbourhood income decline will occur in the inner city as the affluent move to the periphery (Hoyt 1939). The spatial relationship 23

30 Figure 2: Spatial Distribution of Neighbourhoods that Decreased into Lowest Decile Figure 3: Spatial Distribution of Neighbourhoods that Increased From Lowest Decile 24

31 between neighbourhoods that increased from the lowest decile and their proximity to the centre of the city is clearly displayed in Figure 4. As AAHI proportionately increased, neighbourhoods that increased from the lowest decile gravitated inwards. Figure 4: Distance from Centre of City Relative to Change in Average Adjusted Household Income: 1981 to

32 Lastly, the spatial distribution of neighbourhoods that remained in the lowest decile does not present an obvious pattern. Spatially, neighbourhoods that remained in the lowest decile were scattered throughout the city, although the majority (62 per cent) were located in the inner suburbs. There does, however, appear to be a spatial relationship between the location of neighbourhoods that declined into the lowest decile and neighbourhoods that remained in the lowest decile in the inner suburbs. This may suggest spill over effects through various neighbourhood mechanisms transpired between the two neighbourhood categories (Lupton and Power 2004). It is clear from the spatial analysis that neighbourhoods that declined into and remained in the lowest decile were concentrated in the inner suburbs. Although a cluster of neighbourhoods that remained in the lowest decile were located within the inner city, this was not found to be the norm. In contrast, the majority of neighbourhoods that increased from the lowest decile were located in the inner city. These spatial patterns are counter to key urban spatial theories (Hoyt 1939) and indicate that more affluent households are returning to the inner city and that the lowest- income households are moving outward. 4.3 Descriptive Statistics Descriptive statistics were compiled for the three neighbourhood categories and the CMA to set a context. Variables were traced over a 25- year period to allow for examination of changes in demographic and housing stock characteristics. The 26

33 demographic characteristics are divided into two sub- sections: Household and Employment Characteristics. The tables provided in text display weighted proportions for the three neighbourhood categories and the CMA. Absolute figures for each of the variables can be found in Appendix B Demographic Characteristics: Household Changes observed in the characteristics of households presented a couple of intriguing trends. First, across the entire CMA the average household size decreased by almost 9 per cent to 2.68 people per household. This proportionate change pales in comparison to the 22 per cent drop in household size experienced in neighbourhoods that increased from the lowest decile. Similarly, neighbourhoods that increased from the lowest decile were the only neighbourhood category that experienced proportionate growth in the young professional cohort (25-39 years old), while the proportionate change in university graduates was over 2.5 times greater than that experienced in the CMA. This suggests that neighbourhoods that increased from the lowest decile were gentrifying as households became more populated with young, well- educated residents who lived with less people on average (Meligrana and Skaburskis 2005). Secondly, similar to the neighbourhoods that increased from the lowest decile, both neighbourhoods that declined into and remained in the lowest decile experienced significant proportionate growth in educational achievement. In both cases these 27

34 proportionate increases exceeded those experienced in the CMA. This is counter to what one would expect, as education is strongly correlated to personal income and social status (Skaburskis forthcoming). These findings highlight a significant social transition that has occurred in Toronto s poorest neighbourhoods. Table 2: Proportionate Changes in Household Characteristics: 1981 to 2006 Variables Population Between 25-39yrs Old High School Achievement University Degree Achievement Immigrants* CMA Remained in Lowest Decile Declined into Lowest Decile Increased From Lowest Decile Change Relative to CMA Change Relative to CMA Change Relative to CMA Change Relative to CMA *Immigrant figures were traced over a 20- year period. 28

35 Lastly, in 2006, 45 per cent of residents in the Toronto CMA identified as a visible minority. This figure dropped to fewer than 40 per cent in neighbourhoods that increased from the lowest decile; whereas, neighbourhoods that declined into the lowest decile (69.8 per cent) and remained in the lowest decile (67.1 per cent) were represented by significantly higher proportions of visible minorities. Similarly, immigrants were disproportionately represented in neighbourhoods that declined into or remained in the lowest decile. Immigrants represented 45 per cent of the entire CMA, however, they represented 57 per cent of the residents in neighbourhoods that remained in the lowest decile and 64 per cent in neighbourhoods that declined into the lowest decile. Moreover, neighbourhoods that declined into the lowest decile observed the largest increase (48 per cent) in the proportion of immigrant residents. These findings are consistent with other Toronto based studies (Hulchanski 2007 and 2010; Macdonnell et al.2011), and suggest visible minorities and immigrants disproportionately experience poorer socioeconomic outcomes Demographic Characteristics: Employment All of the neighbourhood categories and the CMA experienced a decrease in the employment rate over the time period. This is perhaps reflective of structural changes in the labour market over the past few decades, which has seen a transition from a manufacturing- based economy towards a service- based economy (Wilson 1999). As can probably be expected, given the correlation between employment and 29

36 income generation, neighbourhoods that declined into (1.8) and remained in (1.32) the lowest decile experienced significantly higher proportional increases in unemployment than the CMA. Conversely, neighbourhoods that increased from the lowest decile experienced significantly less (0.47) proportional change compared to the CMA. Table 3: Proportionate Changes in Employment Activity: 1981 to 2006 Variables Employed Rate Unemployed Rate Employment- to- Population Unemployment- to- Population Labour Force Participation CMA Remained in Lowest Decile Declined into Lowest Decile Increased From Lowest Decile Change Relative to CMA Change Relative to CMA Change Relative to CMA Change Relative to CMA Change Relative to CMA

37 Although widely used in labour market analysis, employment and unemployment rates can underestimate the total labour market effects encountered within a neighbourhood (Wilson 1999). Employment and unemployment rates are measured against the labour force, which only includes those who are actively looking for work (Wilson 1999). A more comprehensive measure for changes in the labour market is the employment- to- total population ratio, which reflects the total number of people employed over the age of 15 within the total population (Wilson 1999). Neighbourhoods that increased from the lowest decile were the only category to experience growth (3.8 per cent) in the employment- to- total population ratio. The neighbourhoods that declined into the lowest decile experienced the most substantial drop (12.5 per cent) in this ratio, which was over five times higher than the CMA. Significant disparity exists between labour market participation in those neighbourhoods that increased from the lowest decile and those that declined into or remained in the lowest decile. The most substantial deterioration in labour market participation was observed in neighbourhoods that declined into the lowest decile. Although not reviewed in the report, additional factors, such as less earnings from jobs may also be exacerbating reduced neighbourhood income (Chen et al. 2012; Stapleton et al. 2012). Substantial deterioration in labour market participation could result in further negative neighbourhood effects (Wilson 1999) through neighbourhood mechanisms (Galster et al.2008; Ellen and Turner 1997) and should be 31

38 closely monitored by planners Housing Stock Many characteristics of the housing stock were reviewed, including type, tenure, quality and age. The prevalence of certain housing types in neighbourhoods that declined into and remained in the lowest decile differs significantly from those neighbourhoods that increased from the lowest decile. As of 1981, high- rise apartments (five stories or greater) made up 66.6 per cent of the housing stock in neighbourhoods that declined into the lowest decile and 51.3 per cent in neighbourhoods that remained in the lowest decile. This was significantly higher than the proportion found in neighbourhoods that increased from the lowest decile (14.5 per cent) and in the CMA (29 per cent) for the same time period. The uneven concentration of high- rise units found in neighbourhoods that declined into or remained in the lowest decile is consistent with other Toronto studies (Macdonnell et al and Metcalf Foundation 2012) that found low- income and working poor residents predominately located in high- rise apartments in the inner suburbs. Interestingly, over the time period, the composition of the housing stock was most drastically altered in neighbourhoods that increased from the lowest decile. The proportion of high- rise apartments doubled in these neighbourhoods, while the proportion of single- family dwellings halved. Similar trends were observed in the tenure of housing. 32

39 Table 4: Proportionate Changes in Housing Stock Tenure and Type: 1981 to 2006 Variables Dwellings Owned Dwellings Rented Apartment High- Rises Single- Family Dwellings CMA Remained in Lowest Decile Declined into Lowest Decile Increased From Lowest Decile Change Relative to CMA Change Relative to CMA Change Relative to CMA Change Relative to CMA Table 5: Proportionate Changes in Housing Costs: 1981 to 2006 ($ 2006) Variables Average Dwelling Value Average Gross Rent CMA Remained in Lowest Decile Declined into Lowest Decile Increased From Lowest Decile 1981 $259,504 $195,683 $186,425 $194, $406,511 $302,710 $256,400 $350,698 Change Relative to CMA $884 $646 $788 $ $949 $692 $852 $878 Change Relative to CMA

40 Neighbourhoods that declined into and remained in the lowest decile had parallel housing tenure trends to that of the CMA. Proportionately, these categories experienced an increase in the amount of owner- occupied dwellings. This is somewhat counterintuitive given the initial capital required to purchase a property. However, the actual proportions of owner- occupied dwellings in the neighbourhoods that declined into the lowest decile (39 per cent) and those that remained in the lowest decile (30 per cent) were still significantly lower than the CMA (67 per cent) as of Neighbourhoods that increased from the lowest decile experienced an opposing trend with the proportion of owner- occupied dwellings dropping by 6 per cent over the time period. Interestingly, all of the categories experienced increased average dwelling values and gross rental rates. Although, neighbourhoods that increased from the lowest decile experienced the most significant change with dwelling values and gross rents encountering a proportionate change 1.42 times and 4.56 times higher than the CMA. A deteriorating housing stock was prevalent in all three of the neighbourhood categories. Each category experienced an increase in the proportion of major and minor repairs needed. Proportionately, change was most drastic in both neighbourhoods that declined into and remained in the lowest decile. This provides some evidence that the filtering process may be taking place, as a deteriorating housing stock is passed down to lower- income residents (Hoyt 1939). 34