Houston must improve education levels to support growing economy

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New report from Rice’s Shell Center outlines sustainability issues in Houston super neighborhoods

HOUSTON – (March 10, 2014) – Houston is lauded nationally for its thriving economy, but the staggering disparities in education and income levels may put the city’s economic expansion in jeopardy, according to a new report from Rice University’s Shell Center for Sustainability.

The report, “Houston Community Sustainability: The Quality of Life Atlas,” was released today and offers a widespread look at 24 social, economic and environmental indicators of sustainability in 88 Houston super neighborhoods — geographically designated areas where residents and organizations work together to identify, plan and set priorities to address community needs and concerns. The report’s recommendations are based on 2010 data collected from the U.S. Census Bureau and other national and state datasets, as well as input from city government officials, academic institutions and nonprofits.

Educational attainment

The report’s key finding reveals that only four of the 88 super neighborhoods are where persons with graduate degrees are concentrated. It’s a revelation that report author Lester King finds troubling.

“The percentage of persons with graduate degrees in Houston ranges from one percent or less in 11 super neighborhoods,” King said. “And only four super neighborhoods — Braeswood Place, Greenway/Upper Kirby, Astrodome Area and University Place — have more than 25 percent of the population with graduate degrees.”

King, a sustainability fellow at the Shell Center, noted that half of Houstonians have no degree past high school, and that major intervention is needed in high schools to encourage students to graduate and pursue further degrees so they can position themselves for a better quality of life. King noted that trade degrees are just as essential as academic degrees to compete in the 21st century.

“Higher levels of education directly produce healthier behaviors such as more exercise and enhanced nutrition; better jobs and income and higher quality neighborhoods; and more resources for health care,” King said. “According to the 2010 decennial census, 38.7 percent of persons without a high school diploma were unemployed. In comparison with the city median unemployment rate of 10 percent, this suggests that a person without a high school diploma is almost four times as likely to be unemployed.” He noted that the high school diploma is still the fundamental threshold for the achievement of enhanced quality of life.

“It’s very difficult to earn a decent salary without it,” King said.

Income inequality and cost of living

King said the report’s revelations about educational attainment significantly impact another of the report’s key findings, the level of income inequality in the city. He said that the perception of the city’s “low cost of living” translates to lower salaries.

“Income levels are relatively low in Houston, and most employers will pay less for jobs in Houston than in places considered as having a high cost of living,” King said. “In addition, the large number of restaurants in the city creates opportunities for thousands of low-paying jobs. Large numbers of restaurants result in good social and culinary options available in the city; however, this large number becomes a poverty-enabling opportunity, since the wages at these businesses are very low.

King said that the income disparities are evident in super neighborhoods throughout the city. While Afton Oaks/River Oaks and University Place boast median incomes of well over $100,000, six neighborhoods – Westwood, Kashmere Gardens, Independence Heights, Minnetex, Greater Fifth Ward, Greater Third Ward – have median incomes below $25,000.

Cost of living continues to be a major issue for Houstonians, especially for those individuals living in areas that do not meet the conventional public policy indicator of housing affordability, which stipulates that the average household should not spend more than 30 percent of its income on housing costs.

Super neighborhoods in Houston range from 13 percent (Gulfton) to 44 percent (Hunterwood) of households that spend more than 30 percent of their income on housing costs. In addition, the percentage of housing units in Houston where tenants spent more than 30 percent of their incomes on housing costs increased almost 50 percent in 2010 from 1990 and 2000 levels, which were relatively similar in percentage.

Unemployment and poverty

Houston’s unemployment rate in 2010 was 10 percent – the 18th-highest unemployment rate in the country. For Caucasians it was 6.2 percent, for Hispanics it was 9.5 percent and for African-Americans it was 16.5 percent, a finding that King said demonstrates disproportionate hiring or employment instability for African-Americans living in Houston.

King noted that while 20 Houston super neighborhoods – including Museum Park, Afton Oaks/ River Oaks, Fondren Gardens, University Place —  have an unemployment rate of less than 5 percent, two super neighborhoods — Minnetex and El Dorado/Oates Prairie – have an unemployment rate of more than 20 percent.

King said Houston is projected to add 404,007 jobs between 2010 and 2015 (based on the projected performance trend developed over the 20-year period between 1990 and 2010). King said he hopes that this increase in job numbers will significantly reduce the unemployment rate, despite the premise that many of the new jobs advertised will be filled by new people moving into the city.

“The unemployment issues in Houston lend further support to the idea that educational training needs to be strengthened to meet the specialized needs for Houston-based job mix and reduce the city’s unemployment rate,” King said.

Unemployment is a key contributor to poverty in the city, King said. In 2010 the percentage of persons below the poverty line in Houston (23 percent) was higher than it was in Harris County and Texas (16.8 percent for both).

“Despite the national perception that Houston/Harris County, and to a larger degree, Texas, are wealthy places, all three had higher poverty rates in 2010 than the national average, which was 13.8 percent,” King said.

The poverty rate in Houston super neighborhoods ranges from 3.6 percent in Afton Oaks/ River Oaks to 48 percent in Westwood.

King also noted that while the unemployment rate for Hispanics is only slightly higher than for Caucasians, the number of Hispanics in poverty is almost four times greater. In addition, the African-American poverty rate is four times greater than the rate for Caucasians.

King said that there are several factors to blame for these disparities.

“The program for Hispanics is not job attainment,” he said. “While this could be increased, the real issue is the level of pay attained for the jobs they do secure. And for African-Americans, both job offers and level of pay are issues, as both are significantly lower than average.”

The Houston Sustainability Indicators Project

King said that Houston super neighborhoods are excellent models for planning purposes, since they capture local dynamics in housing, services, transportation and other land uses in manageable community-sized areas for decision makers, city staff and citizens.

“Analysis of sustainable development at the super neighborhood level is representative of the types of social, economic and environmental patterns throughout distinct communities in Houston,” King said. “Most importantly, studying the city through a community-by-community analysis creates more opportunities for empowerment of residents who require resources to aid in the articulation of their needs.”

The report was created as part of the Houston Sustainability Indicators Project, which measured development among districts in Houston based on identified sustainable development indicators. It is a follow-up to two earlier reports: “Houston Sustainability Indicators: A Comprehensive Development Review for Citizens, Analysts and Decision Makers” and “Sustainable Development of Houston Districts: The Health of the City.” Both were studies based on development performance at the city level using data collected for 1990, 2000 and 2010. The reports were funded by Rice’s Shell Center for Sustainability and are available online at http://shellcenter.rice.edu.

The report’s findings will be discussed at the Houston Community Sustainability Symposium and Mixer March 26 at Rice University. For more information or to register, visit http://shellcenter.rice.edu.

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For more information, contact Amy Hodges, senior media relations specialist at Rice, at 713-348-6777 or amy.hodges@rice.edu.

This news release can be found online at http://news.rice.edu/.

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