Economics

History of Poverty in Los Angeles

In the late 19th and early 20th century, Los Angeles experienced rapid growth due to the booming agriculture, oil, and entertainment industries. This growth also unfortunately led to significant income inequality. Of course, the wealthy benefited from the economic expansion, while immigrants and other racial minorities often faced poverty and economic hardships. Particularly the immigrants from Mexico and Asia, faced a lot of discrimination and limited job opportunities, which further exacerbated poverty rates among marginalized communities (Deverell, et al., 2010).

Then, during the Great Depression of the 1930s, like much of the country, Los Angeles experienced widespread poverty and unemployment. The city experienced a surge in homelessness because many people lost their jobs and homes. The economic crisis forced the government to initiate public works programs and welfare initiatives to alleviate poverty. This would then provide some relief to affected individuals and families (Deverell, et al., 2010).

Then, after World War II, Los Angeles witnessed yet another significant population growth and also urbanization. Additionally, it experienced a rise in suburbanization, which resulted in the growth of wealthier neighborhoods (primarily single family homes). In turn, this exacerbated the concentration of poverty in certain areas. This also brought along racial segregation and housing discrimination, which further contributed to the already unequal distribution of resources. Ultimately, this is what we will see today where minority communities, particularly African Americans and Latinos, are disproportionately affected by poverty (Verge, 1994).

Later on, Los Angeles faced “deindustrialization,” or a shift from manufacturing to more service-based industries. In this rather sudden loss of the city’s largest employers, job losses were rampant and poverty became more entrenched in certain neighborhoods. This had a significant impact on the city’s working-class communities and its effects can be seen and felt today (Sheeley, et. al., 2021).

As you can see in the data visualization, in recent decades, Los Angeles has faced a severe housing crisis. More specifically, the neighborhoods that fall under the Central and South bureaus are the most affected by the crisis. This data from the Los Angeles Homelessness Service Association (LAHSA) shows a couple trends that we should investigate. 

First, we should notice that the in the neighborhoods that fall under the Central Bureau, homelessness appears to be going down, but it is still almost 50% greater than the rate of homelessness in the West and Valley Bureaus. Additionally, while the South, West, and Valley bureaus have a lower rate of homelessness, we can see an apparent increasing trend as the decades go on.

 There are many possible causes for this, and it is still hotly debated today. But, typically economic challenges, lack of affordable housing, mental health issues, and substance abuse are blamed when discussing the increasing numbers of individuals experiencing homelessness. The city has tried (to some extent) in finding sustainable solutions to address this crisis, but to little success. Smaller organizations have come together to address poverty in Los Angeles as well, but it’s still a true work in progress (Sheeley, et. al., 2021).

To better understand the current socioeconomic situation in Los Angeles, we can also look at this data visualization. Here, we can see Median Household Income for each of the four Police Bureaus. Immediately, we notice that in all four bureaus, there is an increasing trend, but this is somewhat deceiving. Median Household Incomes are supposed to be increasing regardless (due to inflation), so this detail should not be considered. What should be noticed is that there is already a correlation between the median household income and the rate of homelessness in the police bureaus. This section won’t go into further detail because it is just an introduction to the situation in Los Angeles. The other sections will further explain the relationship between these and also add the variable of crime.

Ultimately, discussing this history is incredibly important because later on in this project, crime levels will be compared to the socioeconomic status of Los Angeles today. We will be trying to find a correlation between the economic statuses of certain areas with the crime that occurs in those areas. So, keep reading!


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