The city of Detroit, in the U.S. state of Michigan, went through a major economic and demographic decline that began in the mid 20th century and lasted for decades. The population of the city fell from a high of 1,849,568 in 1950 to 639,111 in 2020, removing it from the top 20 of US cities by population for the first time since 1850.Detroit population rank is lowest since 1850, The Detroit News Local crime rates are among the highest in the United States (even though the overall crime rate in the city has seen a decline during the 21st century), and vast areas of the city are in a state of severe urban decay.
In 2013, Detroit filed the largest municipal bankruptcy case in U.S. history, which it successfully exited on December 10, 2014. , the median household income is rising, and criminal activity is decreasing by 5% annually as of 2017. In 2025, the US Census Bureau reported that Detroit's population had grown for the second straight year, beginning the long process of reversing the decline of the city's population.
Contributors to decline
The deindustrialization of Detroit has been a major factor in the population decline of the city.
Role of the automobile industry Before the advent of the automobile, Detroit was a small, compact regional manufacturing center. In 1900, Detroit had a population of 285,000 people, making it the thirteenth-largest city in the U.S. Over the following decades, the growth of the automobile industry, including affiliated activities such as parts and tooling manufacturing, came to dwarf all other manufacturing in the city. The industry drew a million new residents to the city. At Ford Motor's iconic and enormous River Rouge plant alone, opened in 1927 in Detroit's neighbor Dearborn, there were over 90,000 workers. The shifting nature of the workforce stimulated by the rapid growth of the auto industry had an important impact on the city's future development. The new workers came from diverse and soon far-flung places. Nearby Canada was important early on and many other workers came from eastern and southern Europe, a large portion of them being ethnic Italians, Hungarians, and Poles. An important attraction for these workers was that the new assembly line techniques required little prior training or education to get a job in the industry.
The breadth of sources for the growing demand for auto assembly workers, however, was sharply limited by the turmoil of World War I, and shortly thereafter by the restrictive U.S. Immigration Act of 1924, with its limited annual quotas for new immigrants. In response, the industry—with Ford in the forefront—turned in a significant way to hiring African-Americans, who were leaving the South in huge numbers in response to the combination of the interwar farm crisis and continuing Jim Crow practices. By 1930 Detroit's population had grown to nearly 1.6 million, and then to nearly 2 million by its peak shortly before 1950. A World War II boom in the manufacture of war materiel contributed to this growth surge. This population was, however, very spread out in comparison with other U.S. industrial cities. A variety of factors associated with the auto industry fed this trend. There was the large influx of workers. They earned comparatively high wages in the auto industry. The plants they worked at, belonging to various major and minor manufacturers, were spread around the city. The workers tended to live along extended bus and streetcar lines leading to their workplaces. The result of these influences, beginning already by the 1920s, was that many workers bought or built their own single-family or duplex homes. They did not tend to live in large apartment houses, as in New York, or in closely spaced row houses as in Philadelphia. After New Deal labor legislation, high auto-union secured wages and benefits facilitated this willingness to take on the cost and risk of home ownership.
These decentralizing trends did not have equal effects on African-American residents of the city. Black Detroiters tended to have far less access to New Deal mortgage support programs such as Federal Housing Authority and Veterans Administration insured mortgages. African-American neighborhoods were viewed by lenders and the federal programs as riskier, resulting—in this period—in much lower rates of homeownership for African-Americans than other residents of the city.
The auto industry also gave rise to a large number of high paying management and executive jobs. There were also large numbers of attorneys, advertisers, and other workers who supported the industry's managerial force. These workers already by the 1920s had begun to move to neighborhoods well removed from the industry's factories and higher crime rates. This upper stratum moved to outlying neighborhoods, and further, to well-to-do suburbs such as Bloomfield Hills and Grosse Pointe. Oakland County, north of the city, became a popular place to live for executives in the industry. "By the second half of the twentieth century, it was one of the wealthiest counties in the United States, a place profoundly shaped by the concentration of auto-industry-derived wealth."
Public policy was automobile oriented. Funds were directed to the building of expressways for automobile traffic, to the detriment of public transit and the inner-city neighborhoods through which the expressways were cut to get to the auto factories and the downtown office buildings.
These processes, in which the growth of the auto industry had played such a large part, combined with racial segregation to give Detroit, by 1960, its particularly noteworthy character of a substantially African-American inner city surrounded by mainly white outer sections of the city and suburbs. By 1960 there were more whites living in the city's suburbs than the city itself. On the other hand, there were very few African-Americans in the suburbs. Real estate agents would not sell to them, and if African-Americans did try to move into suburbs there was "intense hostility and often violence" in reaction.
The auto industry too was decentralizing away from Detroit proper. This change was facilitated by the great concentration of automobile production into the hands of the "Big Three" of General Motors, Ford, and Chrysler. The Big Three were able to build cars better and cheaper and put nearly every smaller competitor automaker out of business. While this corporate concentration was taking place, the Big Three were shifting their production out of central Detroit to escape the auto-union wage requirements. Between 1945 and 1957 the Big Three built 25 new manufacturing plants in the metropolitan area, not one of them in the city itself.
The number and character of these new, suburban auto factories was a harbinger of future trends detrimental to the economic health of Detroit. There was an interaction between factory decentralization and the nature of the industry's post-New Deal unionized labor force. Ford Motor was one of the first to undertake major decentralization, in reaction to labor developments. Ford's workers voted to join the UAW in 1941. This led Ford to be concerned about the vulnerability of its huge flagship Rouge River plant to labor unrest. The workers at this plant were "among the industry's most well-organized, racially and ethnically diverse, and militant". A strike at this key plant could bring the company's manufacturing operations as a whole to a halt. Ford therefore decentralized operations from this plant, to soften union power (and to introduce new technologies in new plants, and expand to new markets). Ford often built up parallel production facilities, making the same products, so that the effect of a strike at any one facility would be lessened. The results for the River Rouge plant are striking. From its peak labor force of 90,000 around 1930, the number of workers there declined to 30,000 by 1960 and only about 6,000 by 1990. This decline was mainly due to labor movement to non-union areas and automation.
The spread of the auto industry outward from Detroit proper in the 1950s was the beginning of a process that extended much further afield. The major auto plants left in Detroit were closed down, and their workers increasingly left behind. When the auto industry's facilities moved out, there were dramatically adverse economic ripple effects on the city. The neighborhood businesses that had catered to auto workers shut down. This direct and indirect economic contraction caused the city to lose property taxes, wage taxes, and population (and thus consumer demand). The closed auto plants were also often abandoned in a period before strong environmental regulation, causing the sites to become so-called "brownfields", unattractive to potential replacement businesses because of the pollution hangover from decades of industrial production. The pattern of the deteriorating city by the mid-1960s was visibly associated with the largely departed auto industry. The neighborhoods with the most closed stores, vacant houses, and abandoned lots were in what had formerly been the most heavily populated parts of the city, adjacent to the now-closed older major auto plants.
By the 1970s and 1980s, the auto industry suffered setbacks that further impacted Detroit. The industry encountered the rise of OPEC and the resulting sharp increase in gasoline prices. It faced new and intense international competition, particularly from Italian, Japanese and German automobile manufacturers. Chrysler avoided bankruptcy in the late 1970s only with the aid of a federal bailout. GM and Ford also struggled financially. It also relocated ever more of its manufacturing to lower-cost states in the U.S. and to low-income countries. Detroit's residents thus had access to fewer and fewer well-paying, secure auto manufacturing jobs.
The leadership of Detroit failed to diversify the city's industry beyond automotive manufacturers and related industries. Because the city had flourished in the heyday of the auto industry, local politicians made periodic attempts to stimulate a revival of the auto industry in the city. For example, in the 1980s the cities of Detroit and Hamtramck used the power of eminent domain to level part of what had been Poletown to make a parking lot for a new automobile factory. On that site, a new, low-rise suburban type Cadillac plant was built, with substantial government subsidies. The new Detroit/Hamtramck Assembly employs 1,600 workers. In the 1990s, the city subsidized the building of a new Chrysler plant on the city's east side, Jefferson North Assembly, which employs 4,600 people. In 2009 Chrysler filed a Chapter 11 bankruptcy case, and survives in a partnership with Fiat of Italy, while GM filed for Chapter 11 bankruptcy on June 1, 2009, and survives as a much smaller company—smaller now than Japan's Toyota Motor Corporation. A little over two years after these major blows to the U.S. auto industry, the city itself went into Chapter 9 bankruptcy after years of mismanagement by local leaders.
Racial housing segregation
During World War II, wartime manufacturing expanded urban employment for black job seekers who were historically underrepresented in Detroit's labor market as labor policies sanctioned hiring discrimination. Despite the expansion of employment available to black Detroiters, racial integration within the workplace was met with fierce opposition from Blue-collar white employees. For these white Detroiters, black employment harbored intense housing competition within Detroit's overcrowded neighborhoods in addition to crumbling the economic stability of Detroit's white middle class. Therefore, as racial integration within the workplace alluded to racially fluid neighborhoods, the white middle class engaged in residential segregation by using discriminatory behavior and policy to regulate black residential agency and accessibility to homeownership.