By David Gutman
BALTIMORE – Twenty-five years ago, the area around Baltimore’s Harbor East was dominated by empty warehouses, a chemical factory that was about to close, and environmental problems. Today, Harbor East is filled with luxury hotels and condos, restaurants, and upscale boutiques that draw tourists and Baltimoreans alike.
“A net plus in jobs and taxes,” said M. J. Brodie, president of the Baltimore Development Corporation.
What Harbor East has not done, however, is replace the thousands of middle-class jobs that were the hallmark of Baltimore’s industrial harbor and that supported nearby neighborhoods filled with middle-class families.
In Baltimore as in many cities around the country, as manufacturers have closed factories and shed jobs, they’ve largely been replaced with service sector jobs that tend not to pay as well.
Faces of Harbor East
Photos by David Gutman.
“These service-type jobs, they are good jobs,” said James Kraft, Baltimore city councilman for District 1, which includes Harbor East. “We need those jobs, particularly for folks who don’t have higher education or more sophisticated job skills.
“Unfortunately, in many cases you can’t raise a family on them.”
Jobs in leisure and hospitality industries in Baltimore pay an average of $27,500 a year, according to the U.S. Bureau of Labor and Statistics. Baltimore’s manufacturing jobs pay an average of $53,000, the government says.
“Harbor East in Baltimore is an example of what has been happening throughout our nation,” said Sen. Bernie Sanders, I-Vt. “The middle class is disappearing as manufacturing jobs, which paid good wages, have disappeared.”
A Brookings Institution study released last month found that “Greater Baltimore is not generating enough quality jobs” and that it must find a way to create more “middle-wage” jobs.
From 1980 to 2007, the eve of the recession, job growth in high-wage industries in Baltimore was three times slower than the national average, according to Jennifer Vey, a fellow at the Brookings Institution. Job growth in middle-wage industries in Baltimore also lagged behind the national average.
The economic shift began decades ago.
From 1980 to 1985, four waterfront area manufacturers shut down–Allied Chemical in Fells Point, Bethlehem Steel Shipyard, Western Electric, and the American Can Company, in Canton. They took 5,900 union jobs with them.
Bethlehem Steel in Sparrows Point, in Baltimore County, farther to the east, cut an additional 8,500 jobs during that time, according to research done then by David Harvey, a former professor of geography at Johns Hopkins.
This is not a story unique to the Baltimore waterfront. Good-paying manufacturing jobs have been disappearing for decades, a result of a changing economy, globalization, and other trends largely beyond Baltimore’s control.
Today, the employers in Harbor East vary widely, but almost all of them fall within the service sector. There are restaurants and hotels; universities, both for-profit (Laureate) and not for-profit (Johns Hopkins Carey Business School); and large banks and financial advisors.
“Harbor East has been incredibly, in fact, overly successful in bringing attractive Class A office space, attractive retail, and attractive hotel space to the city,” said Richard Clinch, the director of economic research at the University of Baltimore, who has worked with Harbor East developers.
Clinch says Harbor East has become a second downtown, taking businesses from other parts of the city.
“Hotel development has traditionally centered on the convention center,” Clinch said. “But where did the Four Seasons go? Where did the Marriott go? To Harbor East, because they could get newer buildings in a newer, better environment.”
That also holds true for many of the higher-paying office jobs located in Harbor East. The financial giants Morgan Stanley and Legg Mason, both had huge new headquarters built in Harbor East.
“They’ve relocated jobs from the traditional downtown,” said Michael Evitts of the non-profit Baltimore Downtown Partnership. “We would have been worried had it not been for backfilling,” Evitts said, referring to the process of abandoned office space being reused or repurposed.
The four largest hospitality employers in Harbor East — Marriott, Whole Foods, Four Seasons, and Hilton — combined employ about 950 people, according to their human resources departments. That’s a lot of jobs, but not enough to replace the thousands that were lost in the early 1980s.
And as the jobs in the area have changed, the neighborhoods have changed as well.
“It’s not the same as when the canning industries and the automotive industries and the shipping industries were all stretched along the water and the people all lived in those working-class neighborhoods,” Kraft said. “That’s just not the case any longer.”
Today, while some employees live nearby, an informal survey shows that they tend to be young and single. People with families tend to live in other neighborhoods.
Tony Rieger, 21, works the front desk at the Courtyard by Marriott on Aliceanna Street and attends Stratford University one day a week. He likes his job and says he is paid well, and gets great benefits. But “the Harbor East area is definitely a little out of my reach.” Rieger said. “Anyone that works in this area usually lives elsewhere.”
Joaquin Torres, 32, has been a bellman at the Homewood Suites by Hilton on South President Street for almost three years. He says he likes his job “about 20 times better” than his previous one, working for a painting company, and that with tips, his pay is excellent, although he declined to be more specific.
Torres lives in nearby Little Italy with his mother and his three-year-old daughter. He says he lucked into an affordable apartment because he speaks Italian and has a rapport with the landlord.
“I’m the only one who can walk to work,” Torres bragged, with a smile. “Harbor East is more exclusive. Little Italy is a neighborhood.”
While salaries can vary widely depending on position, new workers at Hilton make about $12 an hour, according to Edypa Milonas the director of human resources at the Hilton Garden Inn in Harbor East.
One-bedroom apartments in Harbor East buildings tend to rent for more than $2,000 a month, according to real estate listings. That’s more than the monthly earnings of the average new Hilton employee.
Bruce Carter, 35, is a front-office agent at the Marriott Waterfront hotel on Aliceanna Street. He is working toward a degree in kinesiology at Towson University and lives between Fells Point and Canton.
Carter says a lot of the families who once lived in those neighborhoods have moved to suburbs like Towson and Catonsville for more space and lower rents. “Everyone around here is my age, 25 to 40,” Carter said. “When you start having a family this isn’t the place.”
Clinch says that manufacturers aren’t coming back and it’s unfair to compare the jobs they provided with those in Harbor East. “It’s a straw man that makes no sense. It isn’t a question of a great union manufacturing job versus a crappy hotel job. It’s a question of a job versus no job for city residents.”
Jennifer Vey, at the Brookings Institution sees Baltimore’s economic future in five export-based industries–manufacturing, bioscience, information technology, “green” jobs, and transportation and logistics.
“What I ultimately found was that these five industries have a greater share of workers in occupations making a middle-wage or higher who don’t have a four-year college degree,” Vey said.
“That’s not at the exclusion of everything else,” she said. “Certainly you want amenities, and tourism-based industries, and retail, but you can’t be putting all your stock into those types of industries if you want to be growing middle- and higher-wage jobs.”
Kate McGonigle contributed to this article.