Two localities are worlds apart
With their different economic pictures, Sherborn and Springfield illustrate the growing financial inequality in Massachusetts
Sherborn, the state’s wealthiest community, is a bucolic enclave of sweeping estates and horse farms nestled amid Boston’s most prosperous suburbs.
Nearly two hours west sits Springfield, a city with a hollowed-out economy, hungry for jobs, and home to some of the state’s highest levels of poverty.
With their opposite economic destinies, they are rarely confused, but together they embody the forces that are widening the income gap in Massachusetts, a divide that has increasingly separated rich and poor, east and west in the state. Over the past 30 years, Sherborn’s median household income, adjusted for inflation, has increased more than 40 percent to nearly $190,000, while the median income in Springfield has dropped 16 percent to about $40,000 a year, according the University of Massachusetts’ Donahue Institute.
This is the story of two communities and the circumstances that have shaped their starkly different economic fortunes. One is a bedroom community of single-family homes and two-parent families, with high levels of education and jobs in the state’s technology, life sciences, and financial services sectors. The other is a place where good-paying manufacturing jobs are a memory, replaced by low-paying service jobs, or no jobs at all, where college degrees are rare, and most families are headed by single parents.
“You’re talking about people in the same state, but it looks like different worlds to me,’’ said Andrew Sum, director of Northeastern University’s Center for Labor Market Studies and author of “Recapturing the American Dream,’’ an analysis of the Massachusetts economy over the past three decades. “This is not the way our state used to be - back in 1979, we were among the national leaders in income equality. Now, we’re a national leader in inequality.’’
Indeed, Massachusetts lost significant ground. In 1979, the median income of the wealthiest families, the top 1 percent, was 11 times the income of the bottom 10 percent, and 4 times that of families in the middle, according to the Center for Labor Market Studies. By 2009, the size of the gap between the richest and poorest more than doubled, to 24 times, and nearly doubled between the top and middle, to 7 times. Another measure of income distribution, known as the GINI index, also shows increasing concentration of wealth in Massachusetts. In 1979, Massachusetts had less household income inequality than the nation as a whole, ranking 24th among states, according to the index. Today, inequality in Massachusetts exceeds the national average, and the state has the fifth-highest concentration of wealth in the nation.
Soaring pay in some industries has increased the gap, Sum said. For example, Massachusetts investment bankers’ average weekly earnings, adjusted for inflation, rose to $5,000 a week in the past decade, a 35 percent increase. Construction workers’ average weekly earnings remained unchanged at $1,100 over the decade, while the average pay of retail workers fell 9 percent to $534 a week.
Michael Goodman, a professor of public policy at UMass Dartmouth, described the change as the “1 percent phenomenon’’ - a reference to the large gains at the top of the income scale.
“In Massachusetts, a segment of the population has had the opportunity to get extremely wealthy through growth in health care, financial services, and technology industries,’’ Goodman said. “What we need is more opportunities in places that haven’t gotten them.’’
Sherborn, founded more than 300 years ago, began as a farming community. Today it remains a rural refuge - more than half the land is dedicated to open space or conservation land, a luxury for any community 20 miles from downtown Boston.
Rolling hills, orchards, and horse farms dominate the landscape and grand homes, often hidden from view, sit on multiple-acre lots. The median assessment of a single-family home last year was about $750,000.
“Sherborn provides a particular kind of environment for people who want to be close to Boston, but really want to live in a peaceful, rural environment,’’ said Tom Twining, chairman of the Board of Selectmen.
Twining, who lives on a 30-acre farm built in the late 1600s, said many residents share his background. He has worked as a financial industry consultant and his wife also worked in finance. Many of their local friends work downtown at financial services companies, or at biotech and high-tech firms along Route 128 and Interstate 495.
“If you have a life science degree and live in these areas, chances are, you’re doing OK,’’ said Robert Forrant, a professor of economic history at UMass Lowell.
About 80 percent of Sherborn residents over age 25 hold bachelor’s degrees or higher, compared with just 17 percent in Springfield, and about 40 percent statewide, according to the census. Over the past 30 years, people with higher education and advanced degrees have commanded increasingly higher earnings.
While inflation-adjusted median incomes for high school dropouts in Massachusetts have plunged by more than one-third since 1979, to about $36,000 from $55,000, the median income of those with advanced degrees has jumped by a third, to nearly $140,000, according to the Center for Labor Market Studies. In 1979, the median income of workers with advanced degrees was about double that of those without a high school diploma. In 2009, the multiple increased to 4 times.
Sherborn Selectman George X. Pucci said there is extreme wealth in his community, but the term “1 percenter’’ - those in the top 1 percent of incomes - doesn’t describe him and many others in town. Still, he said, a home in Sherborn can connote “I have arrived.’’
“But the people I know do charity work and they’re concerned [with the rising income gap] right along with the rest of the country,’’ he said. “The level we’ve reached is not sustainable and we need to be concerned.’’
In Sherborn, one of the top concerns is education. More than half the town’s $26 million budget supports the schools, which include a regional middle and high school that Sherborn shares with Dover, its high net worth neighbor.
The result is a public school system that is the envy of most. The Grade 10 MCAS results in Science and Engineering/Technology tests were the highest in the state last year. Eighty-one percent of students who graduated from Dover-Sherborn High School in 2010 entered college, compared with 75 percent statewide, and less than 70 percent in Springfield, according to the state education department.
With top-flight schools and zoning policies that generally eschew large-scale commercial development - and the taxes that come with it - homeowners pay a premium. Sherborn has the second-highest property tax rate in the state, Twining said, and the typical family pays about $15,000 a year. That’s more than the annual income in some Springfield neighborhoods.
In Springfield, poverty escalated rapidly as its manufacturing base eroded, according to a study by the Federal Reserve Bank of Boston. Between 1970 and 2000, the poverty rate in the city’s poorest neighborhoods increased from 13 percent, or about 1 in 7 families living below the poverty line, to 30 percent, or nearly 1 in 3.
Across the city today, nearly 1 in 4 families lives in poverty.
The city’s poor typically work in service industries, taking multiple jobs because the pay is so low, according to the Fed study. Many of the poorest households are headed by single parents.
Just over half the families in Springfield are headed by married couples, compared with 90 percent in Sherborn, and 75 percent statewide, according to the census. This prevalence of single-parent families is likely connected to the loss of good-paying jobs when the factories shut down, said Northeastern’s Sum.
“Women don’t get married because they think, ‘These guys don’t have the wherewithal to support me,’ ’’ Sum said.
The increase in single-parent households, in turn, has contributed to the widening income gap. Inflation-adjusted median income for married couples in Massachusetts increased 34 percent between 1979 and 2009, about twice the rate for households headed by single women, according to the Center for Labor Market Studies. Median income for households headed by single men fell 14 percent.
As middle-class families have fled Springfield, the tax base has eroded further, leaving schools without funding and undermining a key path to higher incomes - education - according to the Boston Fed. Springfield has one of the highest dropout rates in Massachusetts, more than 26 percent last year, compared with 8 percent statewide and less than 1 percent in Sherborn, according to the state education department.
Springfield’s unemployment rate was also among the state’s highest, 11 percent in October. The lack of jobs is on display at the state career center, where lines of people looking for work form every morning before opening.
They are people like Jerome Flintroy, a lifelong Springfield resident, who has been unemployed for the past 18 months. He has a high school diploma and a technical degree that qualifies him as a personal care assistant. He also holds a commercial driver’s license.
Flintroy said he doesn’t begrudge the so-called 1 percent their money, but wonders how government could let the rich get so much richer while doing so little to help create jobs.
“The government is set up for the rich to get richer,’’ he said. “I can’t get a bailout but [big automakers] can. I owe child support, they owe money to creditors. How is it that we’re not in the same category?’’