Income Drop in ‘90s Cut a Broad Swath, Data Show


A broad decline in household income during the 1990s struck hard at middle-class and upper-middle-class neighborhoods across Southern California, part of a complex erosion triggered in part by the collapse of the aerospace industry, according to census statistics being released today.

Although the effects were most pronounced in such places as Porter Ranch, Hancock Park and Mission Viejo, there was no geographic pattern to the declines. Household income dropped or stagnated in thousands of neighborhoods from Upland to West Covina and Cerritos to Anaheim.

By contrast, neighborhoods where incomes rose the most during the ‘90s tended to be beach and upscale mountain enclaves, including Manhattan Beach, Newport Beach and Temescal Canyon.

The new data offer a more focused view of trends first depicted in census numbers released in May. That data marked a general trend of declining Southland household income amid the economic boom of the ‘90s, part of a national widening gap between the wealthy and the poor.


In Los Angeles County, for example, the median income dropped from $45,600 in 1990 to $42,200 in 2000 when adjusted for inflation--a stunning change from the previous two decades, when median income in the county rose 3.5% in the ‘70s and 21.5% in the ‘80s. Median household income fell across the Southland in every county except for Ventura County, where it rose by a few hundred dollars.

The data being released today by the Census Bureau will allow demographers to track changes at the census-tract level--areas that average 1,600 households. For example, the census data released in May showed that 18% of Los Angeles County’s residents live below the federal poverty line. UCLA researchers said the new numbers more clearly define that poverty: About 28% of Los Angeles County’s census tracts are “poor,” meaning at least 25% of the tract population lives below the poverty line. That was several times greater than the 5% level in the Bay Area. The number of poor tracts grew in Los Angeles, but remained the same for the Bay Area, the demographers said.

The cause of economic decline portrayed in the new numbers is manifold and reflects such broad social changes as the retirement of the World War II generation and an influx of immigrants taking low-wage jobs, said Dowell Myers, professor of urban planning and demography at USC’s School of Policy, Planning and Development.



No ‘Fresh Replacements’

“Over the decade, California did not get fresh replacements of upper-middle-class new residents, and the state lost a lot of those,” Myers said. “Those that stayed in place got poorer, and immigrants came in at the bottom of the ladder. So everything worked to drop average income.”

Myers also said some of the income shifts at the high end could be skewed because of the way the census categorizes income, allowing the wealthiest to list income ranges instead of actual income to preserve privacy in lightly populated census tracts.

In ranking census tracts, The Times compared only the 45% that did not change boundaries from 1990 to 2000. The data are gleaned from census “long forms,” which were filled out by about 1 in 6 people counted in Census 2000.

The largest income gains went to households in Corona del Mar, a bluff-top community at Newport Beach’s southern edge, where median household incomes rose $30,207, to $98,718.

The other top-gaining census tracts were in Marina del Ray, Manhattan Beach, Temescal Canyon and Coto de Caza, a gated neighborhood in southern Orange County.

The disparate reasons for the region’s overall decline in median income intersected in Porter Ranch, where contiguous census tracts north of the Ronald Reagan Freeway near Reseda Boulevard were ranked 2nd, 6th and 14th on the list of median-income losers. Another tract just to the east, in Granada Hills, was ranked 10th.

A prime factor: high-paying jobs that evaporated with the closing of Lockheed Martin, General Motors and Hughes Aircraft Co. facilities in the early 1990s, said Keith Myers, a Porter Ranch real estate agent for 20 years.



Real Estate Factors

Also, real estate development during the decade was heavy on homes in the $200,000-to-$300,000 range, while new developments now feature $750,000 homes in gated communities, residents say.

Lee Hunt, who has lived on Porter Ranch’s Singing Hills Drive since 1977, traces some of the decline to the aftermath of the 1994 Northridge earthquake.

“It was just an ugly place to be,” Hunt said. As fear of more quakes led some people to move out, real estate values tumbled, opening the door for families who couldn’t otherwise afford to live there.

“That Spanish colonial,” Hunt said, pointing down the street, “was sold to a real estate agent for $146,000.... It’s probably in the $400,000s by now.”

Hunt, 63, is part of the downward trend himself. He and his wife, Lois, 66, retired from teaching in the ‘90s and now receive about $25,000 a year less in income. But the drop is relative: Hunt still has enough money to fix up a 1952 silver MG, build model helicopters and ride a Yamaha scooter. And his wife drives a Lexus.

Some of the drop can be attributed to families whose businesses did not soar during the ‘90s, said Joe Johnson, a Porter Ranch resident and former owner of Liberty Bell Sales, a manufacturer’s representative firm.


Johnson and his wife at one point made $300,000 a year with the business, but closed it two years ago when they concluded that many of their clients wouldn’t survive the current economic slowdown, he said. Now, the couple earn less than $100,000 from government jobs.

Other Porter Ranch entrepreneurs also suffered as their businesses declined, he said, and several moved out. “They’re definitely not living as well as before,” he said.


Biggest Drop in Newport

The largest drop in household income occurred in Newport Beach’s Lido Isle, a man-made island of multimillion-dollar homes nestled among yachts and other pleasure craft in Newport Bay. There, household income dropped by $34,735--slightly more than the starting salary for a teacher in a large school district--to $103,691.

The income drop caught some islanders by surprise. Longtime resident Judy Franco said it might be due to an influx of people retiring to what once were their summer homes.

“I haven’t noticed any lifestyle changes,” said Franco, a former teacher who moved to the island in 1968. “The houses have gotten bigger.”

Another possible cause: Increases in maids and other in-residence servants who count as separate households, and whose wages would weigh down the island average.


Times Director of Computer Analysis Richard O’Reilly, research analyst Sandra Poindexter and Times staff writers Vivian LeTran and Peter Y. Hong contributed to this report..



Changing Household Income

Location of census tracts that experienced the greatest increases and decreases in household income from 1990 to 2000.

INCREASE 2000 Change

Newport Beach $98,817 30,207

Marina del Rey 96,611 24,872

Manhattan Beach 102,096 24,072

Temescal Canyon 117,440 24,016

Coto de Caza 102,068 23,198

Manhattan Beach 117,485 20,048

Thousand Oaks 61,314 16,999

West Bluff 80,851 16,885

Santa Monica 82,110 16,783

Balboa Island 76,381 15,755

DECREASE 2000 Change

Lido Isle $103,691 34,735

Porter Ranch 110,434 30,780

Hancock Park 96,691 29,831

Arcadia 70,000 28,746

Porter Ranch 92,347 26,515

Brentwood 110,262 23,924

Encino 126,206 23,209

Malibu 93,640 19,746

Granada Hills 61,742 19,291

Mission Viejo 102,472 19,274

Notes: Census tracts contain several thousand residents. Each city or community contains a number of tracts. Chart includes only those census tracts whose boundaries did not change between 1990 and 2000.