Are Big College Towns the Key to the American Dream?

While everywhere else suffered in the recession, this new urban species somehow kept unemployment, costs of living, and crime rates down. What we can learn from ‘University Cities.’

University of Kentucky/Collegiate Images, via Getty

It was 1983, and Jim Gray was a baby-faced twentysomething, still mourning the loss of his larger-than-life father, and struggling to steer the family business that had fallen into his lap. Gray Construction was by all measures successful—its $30 million in annual revenue made it a leading player in Glasgow, a small town in south-central Kentucky—but he had bigger dreams.

Having spent a year at the University of Kentucky’s law school, Gray was “smitten” by Lexington, a midsize city with a small-town feel, nestled in the lush, horse farm-resplendent countryside. But what drove Gray to root up his firm and move it slightly north was the economic opportunity posed by the city’s relationship to its signature institution: “I knew that UK’s presence would attract both top-shelf executive-level talent and entry-level talent… engineers from all disciplines, architects, project managers,” Gray remembers. “I understood that the faculty, students, and the institution itself helped ensure a premier quality of life… cultural enrichment… a place where lifelong learning occurs naturally, organically…That would help me attract—and keep—the best and brightest workforce from all over the world.”

And last year, Gray Construction crossed the $1 billion revenue mark.

Today, at 62, but still with the boyish looks and energetic drive of the once-young entrepreneur, Jim Gray is in his second term as Lexington’s mayor. And from their first-floor open-plan office in City Hall—modeled after a visit to New York Mayor Michael Bloomberg—Gray and his team hit upon an economic concept that drew from that decision to relocate more than three decades earlier: that Lexington’s success was secured—and continues to be driven—by its status as a “University City.”

In an op-ed published by the respected urban-planning nonprofit Next City, and elaborated in an eponymous blog, this idea of a new subspecies of city was touted by Scott Shapiro, Gray’s senior policy adviser and a Northeast native who came to Lexington via another traditional path. (He married a Kentucky girl.) Lexington officials conducted an analysis of all cities with metro populations between 250,000 and a million. Those with a major research university at its urban core and with populations made up of at least 10 percent students emerged as a distinct cluster with strikingly similar statistics: Lexington; Ann Arbor, Michigan; Durham-Chapel Hill, North Carolina; Fort Collins, Colorado; Lincoln, Nebraska; and Madison, Wisconsin. All boast the dynamism of America’s major metropolises, with high levels of educational attainment and entrepreneurship, economic resilience out of the Great Recession, and a vibrant arts and cultural community. But in contrast to the major markets, each of these University Cities feature low levels of unemployment, low costs of living, and low violent-crime rates.

The attractiveness of University Cities—particularly to the entering millennial workforce—extends beyond the statistics. Diverse campuses and international student bodies promote more tolerant towns: Lexington boasts a 15-year-old anti-LGBT-discrimination ordinance and a mayor who happens to be gay in a community just 65 miles west of County Clerk Kim Davis’ office. Even religion can actually be a uniting force—or at least the quasi-religious fervor these towns share for their signature college sports teams. Football brings harmony to these towns every autumn Saturday, and from winter through March Madness, college basketball promotes a cohesive, interdependent community: Fans who might disagree sharply on matters of politics, religion, lifestyle, or just about any topic, join voices in passionate advocacy of their squad. Indeed, at least in Kentucky, college sports have played a critical role in racial healing and in securing popular support for higher educational achievement.

It’s no wonder that in a recent New York Times op-ed, Seth Stephens-Davidowitz reported that in his research on the top 150,000 “successful individuals”—defined as those people deemed by Wikipedia contributors to be noteworthy enough for an entry—these overachievers disproportionately came from “university towns and urban areas.” Indeed, on a per capita basis, four of the six University Cities in this newly defined cluster are also among the top 3 percent of communities listed in Stephens-Davidowitz’ study who boast the most “successful individuals.”

Note that the University City construct is qualitatively and quantitatively different from the more traditional concept of a “College Town.” As Gray explains, smaller communities like Athens, Georgia, and Ithaca, New York, don’t have large enough populations to fully take advantage of the talent from their research universities— most graduates tend to find economic opportunity elsewhere—and, worse, the college can tend to be an “omnipresence,” exacerbating town/gown tensions. On the other side of the ledger, larger cities such as Austin— which have grown out of the University City demographic—are facing disruptively higher costs of living and burgeoning traffic and infrastructure nightmares.

But Austin’s growing pains don’t suggest that’s the objective for University Cities to strive for. “I don’t believe in stasis—either you are growing or dying,” Gray said. “Growth is essential to providing economic opportunity. Growth is essential to attracting the best and most sophisticated talent.”

Indeed, University Cities are ideally situated to secure economic growth and leadership. “Lexington and the others weren’t well positioned for the 20th-century manufacturing economy,” Shapiro said. “But in today’s Information Age, these leading universities bring in a high level of talent, of intellectual capability; and our low cost of living, low crime rates, job opportunities, and vibrant arts and culture scene keep them here.”

Gray concurs, arguing that “Decades ago, people moved to where the jobs were. In today’s knowledge economy, the jobs move to where the people are, and the people live where there is a high quality of life.”

Accordingly, the recent “discovery” of this University City genus offers city planners of all stripes a roadmap to economic progress. Smaller college towns can use this example as a pathway for smart growth and development. Big metropolises can find guidance for the development of more productive and synergetic relationships with schools in their communities. College site planners—who used to focus on finding idyllic settings in remote country areas—can understand the benefits of locating or relocating in communities where the University City balance can be best achieved.

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Most of all, Universities Cities themselves can better understand how they can avoid the pitfalls of places like Austin when expected economic growth occurs. Already, some of the cities are collaborating—the mayor of Fort Collins—home to Colorado State University—is traveling soon to Lexington to share his vision of making A city more walkable and bike-able. The communities are sharing and benchmarking best practices, and discussing strategies surrounding common objectives such as the development of universal high-speed broadband access.

“This [University City] discovery was meaningful and significant,” Gray concludes. “The last thing a fish can describe is water. This helps us understand ourselves. Knowing who we are helps us plan for who we want to be and where we want to go. And it allows us to figure out the best way to promote economic development while still retaining all of the quality of life that drew us here in the first place.”