Worcester Business Journal

6 Worcester Business Journal | December 12, 2022 | wbjournal.com BY TIMOTHY DOYLE WBJ Staff Writer R ising rents in Worcester are hitting residents at every income level. As the cost of leased hous- ing has risen and wages have stayed relatively stagnant, the portion of Worcester renters who are overburdened by the cost of their homes has risen to 51%, a rise of 6% from 2010 to 2020 and outpacing nearly all comparable cities in Central Massachusetts and the Northeast. For businesses in and around the city, the increasingly unaffordable costs for their employees to live in Worcester compounds their workforce problems, still exacerbated by the fallout from the coronavirus pandemic and other issues like childcare costs, said Alex Guardiola, vice president of government affairs and public policy at the Worcester Regional Chamber of Commerce. "You see this in the area's industrial and manufacturing sectors, hospitality, and especially in health care," Guardiola said. Clinton are touting their affordability, challenging Worcester. As part of its partnership with WBJ, the Worcester Regional Research Bureau released its new report "Static Income, Rising Costs: Renting in the Heart of the Commonwealth" on Dec. 12 laying out how Worcester has become increasingly Worcester has a rent problem Worcester Business Journal has partnered with the nonprofit Worcester Regional Research Bureau on this report "Redlining: An Economic Legacy" to ex- amine the impact of rising rental costs in the city, along with the historic decisions that have led to specific neighborhoods and people of color to disproportionately bear the brunt of the issue. "As householders spend higher and higher percentages of their income on household costs, they necessarily must make trade-offs in other areas of their lives," WRRB writes. "us, cost-burden has the effect of exacerbating income inequality and inhibiting asset growth; people need a place to live, and may cut back on other areas of spending in order to pay increasingly high household costs." Losing the affordable mantle Worcester has long been considered an affordable alternative to Boston, and while rents in Worcester do not yet match those in Boston, other commu- nities like Fitchburg, Leominster, and unaffordable for renters, while home- owners have seen their costs decrease. Worcester rents grew 80% between 2015 and 2022, reaching an average of just over $1,800 per month, according to Zillow's Observed Rent Index. Over roughly the same time period, Worcester renters saw their incomes in- crease by 1.45% between 2010 and 2020, according to U.S. Census Bureau data. is has led to more than half of Worcester renters being cost-burdened, meaning more than 30% of their in- comes are spent on housing costs. REDLINING: An Economic Legacy More than half the renters in the city are cost- burdened by prices, diminishing the quality of the workforce and creating social issues Redlining: An Economic Legacy The Worcester Business Journal partnered with the nonprofit Worcester Regional Research Bureau on this project to examine how rent increases over the last decade have impacted the city and its businesses. as well as an historic look at how financial decisions rooted in racism 86 years ago have ex- acerbated the housing and workforce problems today. This first part "Worcester has a rent problem" dives deep into how rising rents are creating workforce and social problems in the city. To read the sec- ond part "Trapped in a redlined cycle" on the legacy of redlining in Worcester neighborhoods, flip to page 9. To read the entire WRRB report "Static Income, Rising Costs: Renting in the Heart of the Commonwealth," visit wrrb.org. Alex Guardiola, vice president at the Worcester Regional Chamber of Commerce, sees rising housing costs as one of the main factors impacting employers' ability to recruit and retain workers in the city. The Vernon Hill neighborhood in Worcester is 76% renter-occupied, has an 87% non-white population, the fourth lowest median household income in the city with $38,347, and a 24% poverty rate. PHOTO | CHRISTINE PETERSON PHOTO | EDD COTE

• Cover