Lawrence, Mass. , once an industrial power, set out to reverse a long decline with the Federal Reserve’s help. Now it faces a new economic challenge. Lawrence, Mass.
, received a $700,000 grant over three years from the Federal Reserve Bank of Boston. Credit... Chang W. Lee/The New York Times LAWRENCE, Mass.
— It’s got to be hard to fall farther than Lawrence. This old textile-mill town, 30 miles north of Boston on the Merrimack River, was once a standard-bearer for America’s industrial power. That was a long time ago. Over the last decade, the state took over its schools after math and English scores plummeted to the bottom 1 percent of Massachusetts rankings and the dropout rate soared to three times the state average.
A textile hub in the early 20th century, Lawrence became one of the poorest cities in Massachusetts in the early years of the 21st. It was overcome by heroin and crime. City Hall was tarnished by corruption scandals. In 2012, Boston Magazine bestowed an unwelcome title: “City of the Damned.
” Now the coronavirus pandemic has cast an additional pall over Lawrence, as it has on the rest of the economy. But for the many small cities that have long been left behind, struggling to find a place in the new economy, Lawrence offers a glimmer of hope that they may have a shot at recovery. While there are empty storefronts and boarded windows downtown, the estimated value of the typical Lawrence home increased $100,000 over the last five years, to nearly $280,000, according to Zillow. The high school dropout rate, nearly 30 percent a decade ago, is now under 12 percent.
And the income of the typical Lawrence family, which five years ago had tumbled to just over 55 percent of the median family income in the United States, inched back to 61 percent. Incomplete and tentative, Lawrence’s progress suggests that concerted efforts to reinvigorate depressed local economies — long considered a waste of time by most economists — might offer some promise. 40 % $300 thousand Lawrence high school dropout rate 250 30 200 150 20 Median home price 100 10 50 ’06 ’19 ’15 ’17 ’19 100 % 80 60 Median family income 40 As a share of U. S.
Right Now The S&P 500 fell nearly 4 percent. Stocks on Wall Street fell sharply on Wednesday, following a slump in global markets, as investors face new project...
median family income 20 ’60 ’70 ’80 ’90 ’00 ’10 ’18 40 % $300 thousand 100 % Lawrence high school dropout rate 250 80 30 200 60 150 20 40 Median home price Median family income 100 10 20 50 As a share of U. S. median family income ’06 ’19 ’15 ’17 ’19 ’60 ’70 ’80 ’90 ’00 ’10 ’18 Sources: Massachusetts Department of Elementary and Secondary Education; Zillow; Census Bureau By The New York Times “Even if all of those places can’t make it to the level of Los Angeles, research shows that they can do a lot better than they are doing and make it a lot of the way back,” said Tamar Kotelchuck, an assistant vice president at the Federal Reserve Bank of Boston, who leads what the bank calls the Working Cities Initiative to assist communities in their reinvention. Urban revitalization is not the Fed’s normal line of business.
But over a decade ago, as the financial crisis set off by the implosion of the housing market roiled the nation, it decided that the stagnation of so many cities in its region merited attention. In 2013, it issued a challenge: It would offer grants — funded by private firms, philanthropies and state governments — to poor, smaller Massachusetts cities with promising revitalization proposals. In 2014, the Lawrence Working Families Initiative, which connects parents of schoolchildren with employers, was one of four multiyear grant winners, receiving a $700,000 grant over three years. All four cities have improved.
“They changed from a trajectory in which everybody was plummeting,” said Prabal Chakrabarti, a senior vice president at the Boston Fed in charge of regional and community outreach. “That’s a really big achievement. ” It’s not clear whether Lawrence’s upturn owed anything to this grant. In fact, there is no consensus among economists about how to revitalize places in a way that benefits their people.
Public officials often provide millions of taxpayer dollars in tax incentives to draw businesses into their jurisdiction, with little discernible impact on local welfare. Lawrence tried and failed to lure Emerson College from Boston, said Jessica Andors, who runs the nonprofit Lawrence Community Works. But it succeeded in drawing some trash incinerators to town. It built a mall and parking lots, in the name of modernity and suburbanization, razing many of the handsome old buildings of its heyday.
None of this stopped its fall. The proposal funded by the Working Cities grant was comparatively small bore: to offer assistance like job placement and help with financial planning to the parents of needy children in the city’s public schools. Lawrence’s population is predominantly Latino — mostly Dominican immigrants, but also Puerto Ricans and Guatemalans. So English lessons were a critical part of the plan.
The direct results of this effort are modest, too. Ms. Andors, whose group helped pitch the project, noted that 269 parents had gone through English programs and that 311 had been placed in jobs, mostly making $13 to $14 an hour at cafeterias, manufacturers, nursing homes and the like. The program has also trained 131 parents as certified nursing assistants, child care professionals and teaching assistants.
From the Boston Fed’s perspective, though, this modest approach, focused on building on the assets in Lawrence, is exactly the right path: Local public, private and nonprofit entities diagnose the city’s needs and pull together toward a common goal. The goal itself is almost of secondary importance. “Collaborative leadership, getting along, working together, was the secret sauce,” said Lane Glenn, the president of Northern Essex Community College, which has a campus in Lawrence and was involved in the challenge. “A city like Lawrence could have dozens, even hundreds of goals, but we needed to get clear about a small number of critical goals.
” A board meeting of the Lawrence Partnership, in a conference room at Lawrence General Hospital, offered a taste of this collaboration. Partly in response to the Boston Fed’s challenge, the partnership was created as the locus where leaders from business, government and nonprofits could work on common causes, like encouraging local businesses. It has rallied a group of banks to commit $2.
“5 million for a loan fund for small businesses.”
It raised money for an internship program for high school students, placing many of them among its corporate members. Together with the community college and a local real estate developer, it is underwriting a test kitchen where entrepreneurial cooks can have a shot at creating a business. Last year, the partnership supported an initiative to help employers draw on the local immigrant work force, which includes many who don’t speak English. “We identify local manufacturing employers who need people but are not operating bilingually now,” Ms.
Andors said. Marko Duffy, a supplier of electroplating chemicals, is one of the operation’s assets on the ground. A few months ago, he started visiting local companies, offering bilingual training sessions to their workers on topics ranging from modern nickel plating techniques to how to become a supervisor and advance up the corporate ladder. He offers employers help with how to label equipment on the production line in both English and Spanish, as well as to translate company manuals.
“I deal with lots of manufacturers in the region and always hear the same thing,” Mr. Duffy said. “How do we replace our aging work force? Where do we get good people?
” Many in Lawrence’s immigrant community have skills needed in manufacturing processes but can’t get over the language barrier. The Boston Fed’s challenge has helped mint some solid successes, like 99 Degrees Custom, now the city’s only textile company. Founded by Brenna Nan Schneider in 2013 in the hulk of an old mill, it produces activewear for several brands and is expanding into wearable technology — clothes bedecked with sensors and gadgets. Ms.
Schneider employs 140 workers, mostly immigrants from the Dominican Republic, with a goal of 200 by the end of the year. She is working on high-tech projects commissioned by the Massachusetts Institute of Technology and the military. But getting out of the gate required help. The Lawrence Partnership provided a $100,000 loan.
The Working Families Initiative helped her tap into the local work force. 1 mile Lawrence General Hospital Lawrence Northern Essex Community College canal st. 28 99Degrees North Andover south lawrence S. broadway Lawrence High School 133 Merrimack River 495 Andover N.
H. 20 miles 95 Lawrence 93 495 Atlantic Ocean Boston 3 massachusetts R. I. By The New York Times The Boston Fed would love to see more businesses like hers take root around the region.
In total, it has awarded 17 multiyear grants to cities in Massachusetts, Rhode Island and Connecticut. It is looking at broadening the challenge to include rural areas. What’s more, its model is catching. The Dallas Fed and the Richmond Fed are considering similar initiatives.
But even before the coronavirus outbreak upended life everywhere, Lawrence had tough challenges. Its families are still substantially poorer than the national average. Only about 11 percent of adults have a college degree. Lots of the better-paid jobs in Lawrence are taken by out-of-towners, while many residents work in low-wage jobs elsewhere.
“If we don’t upskill our community now, we may lose a generation of opportunity,” said Abel Vargas, the executive director of the regional work force board. And then there is the immediate danger of the coronavirus. Ms. Schneider despairs for her workers, whom she has reorganized into two skeleton shifts of 60 to keep them farther apart, cutting their shifts by one hour.
They eat in temporary cafeterias with a capacity of 15, spread out, facing away from one another. “How do we run a manufacturing business that cannot predict when it will be open or closed or who will show up to work? ” Ms. Schneider asked.
“How does a manufacturing company withstand the risk of a prolonged and ongoing disruption? ” If the town overcomes this crisis, it is still unclear what could allow Lawrence to prosper in the long run, pulling dollars from the outside. Health care? There are a few hospitals in town, and several education institutions offering training in health-related occupations.
More light manufacturing? An Amazon warehouse is expected to open this year or next in nearby North Andover, employing 1,500. One prospect that worries many residents is that the city’s future will be determined by gentrification — affluent young Bostonians fleeing high rents to settle in the new condos being carved out of some of the old mills — pushing up housing costs. Derek Mitchell, who runs the Lawrence Partnership, said families in Lawrence faced the steepest housing burden of any city in the state.
But to find cheaper rents they would have to move a long way north or west, “taking them even further away from the economic opportunities of the region. ” And this underscores how difficult it can be to improve the lot of a city and its people. As Mr. Glenn of the community college put it, “We must ensure the city doesn’t succeed just for those who can afford it.
We are holding a conference call for DealBook readers tomorrow, April 2, at 11 a.m. Eastern. We will go behind the scenes of the Trump administration’s response...
Fears are growing that the worldwide economic downturn could be especially deep and lengthy, with recovery limited by continued anxiety. LONDON — The world is a...
