A city divided: The resurgent downtown and the abandoned urban core

by Jordan Green // photos by Amanda Salter

For the residents of Cleveland Avenue Homes who live just across Highway 52 or the people who live in the Boston-Thurmond neighborhood a couple blocks north of downtown Winston-Salem, the glittering urban revival at Wake Forest Innovation Quarter might as well be a different world.

With BioTech Place as its centerpiece, the innovation quarter is rising from the bones of the old RJ Reynolds tobacco works, a visual manifestation of the new biotech and knowledge economy with a co-working space, luxury condos and new park with a stunning view of the skyline. Anchored by Wake Forest School of Medicine and the tech company Inmar, the highly educated, well compensated new-economy workers already have access to a burgeoning fine-dining scene just to the west on Fourth Street, and the completion of the Bailey Power Plant retail, restaurant and entertainment complex will soon augment the creative-class buzz around Krankies Coffee and its brace of kindred hipster enterprises.

“We say we’re the City of the Arts, and we have this biotechnology industry that’s fastly growing,” said Nakida McDaniel, a community organizer who works with the residents of Cleveland Avenue Homes and Boston-Thurmond through the nonprofit Neighbors for Better Neighborhoods. “I don’t think we’re really looking to see where people’s interests lie in terms of creating jobs. People don’t see opportunities. There’s all this growth going on, but the people I work with don’t have access to it.”

And if downtown and the innovation quarter looks distant and unattainable from East Winston, then from the other end the poor areas of the city may as well be invisible.

“They have no idea what’s going on, on the other side of 52,” McDaniel said. “It’s like a separate world. The poverty is concentrated. I work in areas where the children haven’t even been outside of East Winston.”

Downtown has experienced a stunning revival since 2001, when Mayor Allen Joines took office; BB&T ballpark, the burgeoning entertainment district on North Trade Street and the transformation of the Reynolds Building into a luxury hotel are but a few of the landmark projects that are either complete or quickly coming to fruition. But there’s a darker side of the story of Winston-Salem’s transformation from manufacturing center to vanguard of the knowledge economy — the explosion of concentrated poverty and deterioration of living-wage jobs for people without advanced degrees.

As Joines has acknowledged, Winston-Salem has the highest poverty rate of any of the five largest cities in the state, up to 24.0 percent in 2014 from 15.2 percent in 2000. While all three Triad cities share a history of transition from manufacturing, Greensboro and High Point have weathered the structural adjustment of deindustrialization and the shock of the Great Recession with somewhat less pain; Greensboro’s poverty rate leapt from 12.3 to 19.8 percent from 2000 to 2014, while poverty in High Point rose from 13.2 to 21.2 percent over the same period.

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A July 2014 Brookings Institution study ranked Winston-Salem No. 2 in the nation for growth in suburban poverty. Beyond the headline-grabbing No. 2 ranking, the more important revelation in the study was that four North Carolina metro areas, including Winston-Salem, ranked in the top 15 for growth in poverty. Among the four, which also include Raleigh, Charlotte and Greensboro-High Point, Winston-Salem has the most concentrated poverty, with 16.2 percent of poor people living in Census tracts with poverty levels of 40 percent or higher.

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“The challenges of poor neighborhoods — including worse health outcomes, high crime rates, failing schools, and fewer job opportunities — make it that much harder for individuals and families to escape poverty and often perpetuate and entrench poverty across generations,” the Brookings Institution report indicates. “These factors affect not only the residents and communities touched by concentrated disadvantage, but also the regions they inhabit and the ability of those metro areas to grow in inclusive and sustainable ways.”

A more damning No. 2 ranking for Winston-Salem came out of a April 2015 income mobility study by Harvard University researchers Raj Chetty and Nathaniel Hendren that found that only one county in the United States ranks worst than Forsyth in helping poor children climb the income ladder. The study estimated that poor boys will lose $7,960 in annual earnings when they become adults just by virtue of growing up in Forsyth County, compared to a loss of $4,010 in neighboring Guilford.

It’s not as though Greensboro and High Point are a beacon of opportunity and economic progress compared to Winston-Salem. Look at any measure where Winston-Salem is among the worst and it’s a sure bet that the two other Triad cities aren’t far behind. But in one measure related to poverty, Greensboro and High Point do worse than Winston-Salem. Last year, the Food Research and Action Center ranked the Greensboro-High Point metro area the worst in the nation for food hardship. More than one in four people reported they didn’t have enough money to buy food for their families sometime during the past 12 months in Greensboro and High Point. Winston-Salem ranked No. 22 in the survey, with one in five people reporting they couldn’t afford to put food on the table at least once during the past 12 months.

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Mayor Joines announced an initiative to tackle poverty — a “thought force” — soon after winning reelection to his fourth term in 2013.

“Do you have an alternative to the suffering of the working poor?” he asked during remarks from the dais at City Hall in December 2013. “Do you have a solution to offer the single mom who works two jobs to make ends meet? Or do you have a solution for the couple that has been working every day but some catastrophic event has placed them in an economic situation that is beyond their control? To those who doubt this initiative, if you don’t have a solution, are you suggesting that we just continue on the present course and let these individuals continue to suffer? I’d say that is not an acceptable answer.”

Notwithstanding the soaring rhetoric of the mayor’s speech during the organizational meeting for the new term, the effort didn’t really get off the ground until almost two years later in late 2015. Chaired by Wake Forest University Provost Rogan Kersh, the Poverty Thought Force held two community meetings organized in a “world café” style format in February and March to gather input on four areas related to poverty: education and life skills, housing and homelessness, health and wellness, and jobs and workforce development. Joines said the thought force will analyze the ideas generated through the meetings and come up with a set of objectives that are “feasible and impactful” for reducing poverty to present for city council’s consideration this summer.

Joines, who is up for re-election again in November, said it’s too early to say what approaches to tackling poverty might hold the most promise.

“Because it is a complex issue, it’s going to take a comprehensive approach,” he said in an interview. “I’m encouraged that we had great turnout and good participation at the world cafés. We have good, critical thinkers involved with a strong commitment to move forward with recommendations for our council.”

Winston-Salem is Exhibit 1 for the story of how de-industrialization has coincided with an explosion in mass incarceration, functioning as a way to warehouse and control the surplus labor force, over the past 25 years in the United States.

Carolyn Highsmith emerged as a community leader in the Konnoak Hills neighborhood on the south side of Winston-Salem through a series of fights against commercial rezoning on Peters Creek Parkway and efforts to reduce crime. Highsmith’s interest in protecting the stability of her middle-class neighborhood eventually drew her into a coalition of other community leaders who pushed back against low appraisals in the 2013 tax revaluation that diminished residents’ financial assets and to advocate for investment in urban schools as the Winston-Salem/Forsyth County School Board considers a bond referendum this year.

Reflecting the increasing economic fragility of neighborhoods like hers and rising poverty in Winston-Salem, Highsmith pointed to the loss of solid, middle-class jobs.

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“I don’t think we have a diverse mixture of employment opportunities in this city,” she said. “I base that on the fact that my parents experienced — Western Electric came here in the ’50s. You could walk in and get a job. We have a long history of RJ Reynolds, Hanes knitting and Wachovia banking. Starting in the late ’80s with the RJR buyout and the dissolution of AT&T, we lost Western Electric manufacturing. We lost Hanes textiles; they got bought out. We lost Wachovia bank. You’re talking about huge swaths of middle-class jobs that were lost since the late ’80s, and we really got hit in 2008. I guess you can blame NAFTA for part of that: Textiles went offshore to Mexico and China.”

One of Highsmith’s grandfathers worked for RJ Reynolds, and another worked for Vogler’s jewelers, a business that survived the Great Depression by catering to the wealthy. An uncle worked for Piedmont Airlines, and both of Highsmith’s parents were employed by Western Electric.

“There’s been a huge effort to bring in high-tech jobs and biotech jobs, but there’s only a small segment of the population that can benefit from those jobs,” said Highsmith, who is running for city council in the South Ward. “Then we’re bringing in these telemarketing jobs that either pay minimum wage or just a little above. They’re mainly marginal, low-paying jobs. If we don’t have enough people qualified to work in biotech we’ll be recruiting people to fill those positions. Do we really want our local people to be the janitors and housekeepers? You’re creating society of the have and the have-nots.”

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Marquita Wisley, who grew up in rural Yadkin County, inherited the post-industrial economy when she moved to Winston-Salem at the age of 19 in 2002. Winston-Salem held the promise of better job opportunities and more housing choices and, not least important, Wisley thought the city would be a less judgmental place to raise her newborn daughter, who is biracial. Wisley moved away from Winston-Salem in 2004, and in 2005 she caught a drug-trafficking charge and wound up serving a three-year prison sentence.

Coming out of prison in 2008, Wisley was determined to raise her children, whatever the challenges. Even though she had paid her debt to society, she has continued to struggle to access employment and housing, with one cruel rejection seeming to follow another.

Education and training are supposed to be paths out of poverty, but Wisley found that the certifications she received in prison for culinary arts and horticulture, along with a partial certification for cosmetology, were all but worthless when she entered the job market.

She has been offered several jobs, only to have them rescinded when the background checks come back showing her criminal record.

“I went to get a job at Walmart as a sales associate,” Wisley recalled. “They gave me the interview. They offered me the job as the manager of the makeup section. I said, ‘Of course, I’ll take it.’ I got the blue shirt and khaki pants. Then they rescinded it. It was crazy because during the interview I told them I was a convicted felon, but then they rescinded the offer after the background check came back.”

Wisley encountered the same barriers in housing, with prospective landlords using her criminal record as a reason to discriminate against her. One time she called a Salvation Army shelter, but they had a waiting list. Another shelter would only accept her if she was a domestic violence victim, which did not apply to her.

Wisley became homeless, with three daughters to take care of and pregnant with a fourth child, for more than a year. The family stayed with one and then another sister until the close quarters wore everybody down. Wisley and her girls stayed at the Royal Inn on Broad Street for about two months before it was shut down, thanks in part to complaints about drug activity from residents in the West Salem neighborhood.

“It was the cheapest hotel in Winston-Salem,” Wisley recalled. “I could do odd jobs; I could do hair-braiding, just so we could have some kind of private place. I worked really hard to give my children something.”

Wisley tried to maintain as much normalcy for her daughters as possible.

“Their friends didn’t know there was anything wrong,” she recalled. “We would lie and tell their friends that we moved across town, but we still wanted them to go to the same school.”

The family remained homeless over the summer. One daughter participated in a cheerleading program, and another got the opportunity to participate in a summer drama program at Reynolds High School.

“My daughter’s really into acting, and they only invited 100 children,” Wisley said. “She was extended an invitation. I wasn’t going to turn her down. We might have to take a cab to get there. I made sure she got there at 9 a.m. Some days it was a struggle: We didn’t even know if we were going to have a roof over our heads when she got out at the end of the day.

“I tried to make sure that everything they were doing stayed as normal as possible,” she continued. “My life was a complete mess, but theirs didn’t have to be.”

Wisley and her family eventually secured permanent housing at Cleveland Avenue Homes, a public-housing community in East Winston, but only through the advocacy of a family member who lived at Sunrise Towers, which is also managed by the Housing Authority of Winston-Salem. Wisley’s uncle told a member of the office staff about her situation, and the woman ended up advocating for her.

“If you have a drug conviction that took place in public housing, you can’t access public housing,” Wisley said. “My uncle explained to her that [the offense] was nowhere near public housing.”

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The Brookings Institution defines “high-poverty” neighborhoods as those where more than 20 percent of residents are poor, and “distressed” neighborhoods as those where more than 40 percent of residents are poor. More than 60 percent of the residents of the Census tract that includes Cleveland Avenue Homes are poor, so maybe the neighborhood deserves the designation of “severely distressed.”

Poverty correlates closely with race, and the four severely distressed neighborhoods in Winston-Salem — all just to the east of Highway 52, with two each north of the Business 40 interchange and to the south — also bear the hallmarks of heavy racial segregation. The two northerly neighborhoods are 84.6 percent and 98.8 percent African-American respectively, while the two neighborhoods to the south of Business 40 and Winston-Salem State University stretching down to Waughtown Street are a mix of black and Latino. Anywhere from 58 to 75 percent of residents lack education beyond high school, and typical of poor neighborhoods, rental housing makes up 75 percent or more of the residential market.

Chetty and Hendren, the Harvard researchers, noted “a strong negative correlation between standard measures of racial and income segregation and upward mobility” in their April 2015 study.

“Moreover,” they wrote, “we also find that upward mobility is higher in cities with less sprawl, as measured by commute times to work. These findings lead us to identify segregation as the first of five major factors that are strongly correlated with mobility.”

The irony of the tech boom on the other side of Highway 52 is that the new knowledge-based jobs require advanced degrees and are largely off limits to a population in which more than half the people lack even a basic college education, while many of the jobs for which people are qualified are on the fringe of the city.

“There’s jobs in Rural Hall that Inmar has for scanners,” said Nakida McDaniel, the community organizer with Neighbors for Better Neighborhoods. “One of the young ladies told me: ‘I don’t have transportation out there.’”

Low educational attainment in poor neighborhoods is compounded by a likelihood that children will attend failing schools, perpetuating intergenerational poverty. While there’s a strong argument that the letter grades the state Department of Public Instruction assigns to schools stigmatize schools with large populations of poor students, the statistics don’t lie: Failing schools are likely to have a high population of students who qualify for free and reduced lunch, and Census tracts with high levels of poverty are likely to be served by failing schools.

“Proxies for the quality of the K-12 school system are also correlated with mobility,” Chetty and Hendren write. “Areas with higher test scores (controlling for income levels), lower dropout rates and smaller class sizes have higher rates of upward mobility. In addition, areas with higher local tax rates, which are predominantly used to finance public schools, have higher rates of mobility.”

Forsyth County has the second lowest tax rate of North Carolina’s five largest urban counties, after Wake. Winston-Salem/Forsyth County Schools holds a mixed record among the five largest school districts in the state. It carries the highest short-term suspension and dropout rates of the five largest school systems, but falls somewhere in the middle, alongside Guilford County Schools, for the number of failing schools. Winston-Salem/Forsyth County Schools ranks second behind the Wake County Public School System for the percentage of students accepted at UNC System institutions, but lands in the middle of the pack when it comes to the retention rate for third-year college students.

Advocates for urban reinvestment, including Carolyn Highsmith, have been pushing for a new middle school in East Winston and the replacement of Ashley Elementary in Wisley’s neighborhood. So far, there’s little evidence that they’ve persuaded members of the Winston-Salem/Forsyth County School Board to add the projects to the proposed bond list.

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One aspect of severely distressed neighborhoods remains invisible in the official stats: The Census doesn’t track the number of people who have cycled through the criminal justice system and re-entered society after serving time in prison. When she moved into Cleveland Avenue Homes, Wisley discovered that many of the people she met in the neighborhood were in the same situation as she was. She estimated that anywhere from 50 to 75 people in the neighborhood have either served time in prison or have a family member that has served time. The unemployment rate in some distressed and severely distressed neighborhoods in Winston-Salem lands in the double digits, sometimes approaching 20 percent, and median household incomes ranging from $8,775 to $14,041. But those figures can be deceptive, said Wisley, who earns money by doing hair and public speaking engagements performed under contract through Neighbors for Better Neighborhoods.

“We’re one of the poorest sides of Winston-Salem, but we have one of the biggest spending powers,” Wisley said. “People work hard. They might not be the best jobs or the most legal jobs. People make money and spend money. They don’t think we do because it’s not on paper. We might be the poorest on paper, but we make money. And poor people spend money. I don’t know where we get it, but we spend a lot of it.”

Wisley and the other residents at Cleveland Avenue Homes have been discussing the idea of trying to organize a cooperative grocery store in East Winston. They would welcome an Aldi, with affordable prices and quality food. There is a Sav-A-Lot and a Food Lion at the intersection of Martin Luther King Jr. Drive and New Walkertown Road, but Wisley said the stores are too far of a walk from Cleveland Avenue Homes or the Piedmont Circle Apartments public-housing community near the airport. The Winston-Salem Transit Authority’s restriction of two grocery bags per rider results in many residents relying on corner stores that charge inflated prices.

A quality clothing store and healthy sit-down restaurant would also do well in East Winston, Wisley said.

“If you live on the west side of town, you can work, live and entertain yourself in the same part of town,” she said. “That doesn’t happen in the east side. That should be a right of everyone has — to live, work and play in the same area.”

Tracking the rise of poverty neighborhood by neighborhood over the past 15 years in Winston-Salem shows a consistent pattern of weakening economic vitality. Among North Carolina’s five largest cities, Winston-Salem entered the new millennium with the smallest middle class and has held that status to date, even as all five cities saw their middle quintile diminish.

From 2000 to 2014, 13 Census tracts — mostly hugging Highway 52 — went from low poverty to high poverty, while seven went from high poverty to distressed. One tract deteriorated from distressed to severely distressed, and two tracts — flanking Business 40 just east of the Highway 52 interchange — leapfrogged from high poverty to severely distressed. Similarly, the Old Town neighborhood off Reynolda Road transitioned from low-poverty to distressed. And the deterioration is not limited to neighborhoods where poverty is concentrated: With the exception of a handful of tracts, virtually all parts of Winston-Salem have experienced a rise in the number of poor people over the past decade and a half. Only two areas of the city — Bethabara and a fringe area near Rural Hall — saw the pattern reversed, with a transition from high poverty to low poverty.

Median household incomes in many neighborhoods across the city, including some low-poverty tracts, have fallen, even without factoring inflation, while housing values have shown modest to robust growth. The divergent patterns raise the question of whether millennials and gen-Xers will be able to afford to invest in homeownership, even as baby boomers age out and start to move into assisted-living communities.

With downtown transforming before our eyes, it’s easy to forget that fewer than 2,000 people live there. Beyond the castle moat, the neighborhoods where the vast majority of Winston-Salem’s residents live are crying out for investment.

“People have a big misconception about the people who live in East Winston,” Marquita Wisley said. “We have the same values; we have the same goals, the same dreams. It’s always the bad side of East Winston that’s showcased. I wish people would take a look at the good things that are going on and the good people that are over here.”