Philadelphia needs to come up with ways to accelerate job growth.
That was a key takeaway from a panel discussion during the Central Philadelphia Development Corp.’s membership meeting.
The panelists included Della Clark, president of the Enterprise Center; Michael Forman, chairman and CEO of FS Investments; Michael Pearson, president and CEO of Union Packaging; Jerry Sweeney, president and CEO of Brandywine Realty Trust; Shari Reams, senior vice president of PNC Real Estate; and Richard Vague, managing partner of Gabriel Investments.
They were asked to identify what Philadelphia’s top priorities should be for the next year to prompt faster and more inclusive growth.
The panelists cited Philadelphia’s public education system, growing the job base, reducing poverty and making the city more business-friendly as some of the top priorities for city leadership.
If the city wants to reduce poverty, it needs to increase the number of jobs available, Forman said.
Sweeney said city leaders should set a goal of being one of the top five job-growing cities in the country in 10 years.
“I think that solves a lot of our issues relative to education, poverty reduction and how we create a really effective platform for diversity in the trades for economic inclusion.”
Paul R. Levy, president and CEO of Center City District, noted that Philadelphia has had eight straight years of job growth.
“That’s 68,000 jobs added since the recession,” Levy said.
Philadelphia’s poverty rate is 26 percent — the highest among the 10 largest American cities. The poverty rate is more than 40 percent in parts of the city, including North Philadelphia and West Philadelphia.
“While everyone is focusing on poverty in the city and the disparities, which is very real, the real income disparities remain between the city and region,” Levy said.
“The wealth in the region remains in the suburbs. It is not concentrated in the city and that to me defines the central issue we face. We have a very diminished tax base because we lack the wealth and jobs in the city.”
He noted that 38 percent of the ZIP codes in Philadelphia have steadily lost residents since 2010.
“If you look at these numbers, 62,000 more people have moved out than have been moved in — in both Black and white neighborhoods outside of the downtown,” Levy said.
He noted that more households that make over $125,000 per year are moving out than are moving in and 81 percent of the people who left since 2010 did not have children.
“These are profound challenges, which to me are reflective of the bigger challenge,” he said. “People follow jobs.”
While the 25 largest American cities have been growing jobs at the rate of 2.3 percent, Philadelphia lags behind with a growth rate of 1.4 percent. Levy said that if Philadelphia’s rate of job growth increases to 2.3 percent, the tax base for services and schools would be strengthened.
“Had we grown at the average rate of the 26 largest American cities, we would have added not 68,000 jobs but 115,000 jobs,” he said. “That ought to be the goal — to get up to that level.”
Forman said he thinks partnerships between business and government are the key to creating jobs.
“It’s about making it more attractive to do business in Philadelphia,” he said.
“We learned a lot through the Amazon process. We need to take what we learned and implement that and make sure we have an environment that is friendly toward business.”
Clark addressed the importance of Philadelphia benefiting from the federal Opportunity Zone initiative designed to encourage investment in distressed communities by providing tax incentives to investors. The zones are expected to help spur $100 billion in private capital investment around the country.
“If I had the opportunity to bring a wide range of leadership of both civic and private together, it would be to discuss the Opportunity Zone because that designation will expire in 2026 and I think that the City of Philadelphia should aggressively take advantage of it,” she said.
Reams said city leaders also need to make sure tax advantages, like the city’s controversial 10-year tax abatement program, remain in place to spur investment in affordable housing.
“At PNC, we actually have formed an Opportunity Fund and we are making strategic investments in affordable housing and we have closed on our first deal to add 16 new workforce housing units in Philadelphia,” she said.
“I think that we need to be looking at things like that, ways to expand the tax advantages for affordable housing, rather than taking away programs that have worked to increase investment in our city.”