Parliamentary Research Branch

PRB 99-1E

INTERNATIONAL PERSPECTIVES ON FACTORS
CONTRIBUTING TO HOMELESSNESS

Homelessness is not new; it has been around for centuries in various forms. It has recently become the focus of more attention and concern, however, as its presence and its effects have become more visible in the modern urban landscape. This section will examine the international experience of homelessness. While the national economic, legal, social and welfare systems of various countries may differ substantially, making inter-country comparison difficult, such comparison can provide fruitful insights into how homelessness has evolved in different contexts and may help to identify the principal factors that contribute to it. U.S. researchers have been studying homelessness since the beginning of this century, and have thus a richer experience and a longer perspective on this phenomenon. Their research, described below, may provide insights and have application to the Canadian experience of homelessness.

From the late 19th to the first half of the 20th century, the homeless, mostly unattached and transient labourers, congregated in the poorer districts of American cities, often called "Skid Rows." The numbers of these labourers increased until the 1920s, when the introduction of mechanisation in industrial and materials-handling processes drastically reduced the demand for casual and unskilled labour.

In the 1930s, the Great Depression caused the ranks of the homeless to swell considerably. With scarce or non-existent job opportunities, many able-bodied men dropped out of the labour market and became part of an army of "permanently" unemployed transients. This mass of homeless people often overwhelmed the available "Skid Row" accommodation; many were housed in emergency shelters, in special camps located on the outskirts of the cities or, when temporary housing facilities were unavailable, simply escorted out of town.

World War II brought a substantial decline in the homeless population, as many transients were integrated into the armed forces or absorbed in the burgeoning war industries. As a result, the homeless population shrank considerably, though it did not altogether disappear.

In the 1950s, transients living outside the family unit tended to be concentrated in the poorer districts of the city where there were cheap hotels and restaurants, bars, religious missions and casual employment agencies. The current notion of "homelessness," based on the absence of shelter, did not strictly apply here, as most of the poor could readily find shelter in rooming houses, cheap hotels, or other forms of substandard housing ("flophouses"). In fact, only a small minority of the "transient" population actually resorted to sleeping on the streets.

Moreover, until the late 1950s, this population was still more or less integrated into the urban economy. Often located near transportation hubs such as railroad freight yards or trucking terminals, "Skid Rows" gave unattached individuals and migrant workers the opportunity to find work, usually in casual or menial jobs.

In the 1960s and 1970s, most researchers believed that "Skid Rows" were destined to disappear. They pointed to the substantial drop in transient populations and high vacancy rates in cubicle hotels as evidence of its imminent departure from the urban landscape. Also, the continuing mechanisation of low-skilled or menial tasks in the 1960s and 1970s further reduced the economic function of these areas as a source of cheap labour. A survey of 41 American cities noted that populations in such poor areas dropped by 50% between 1950 and 1970. Further, where the markets for unskilled labour declined sharply, the drop in these populations was correspondingly larger.(1)

However, the predicted demise of the "Skid Row" and homelessness was premature. While most flophouses and cheap hotels were demolished, and the land reclaimed used to raise more apartment and office buildings, the homeless did not disappear. Quite the opposite happened; the homeless became more visible as their composition changed substantially in the late 1970s and 1980s.

American sociologist Peter H. Rossi attributes the recent rise of homelessness in the United States principally to the disappearance from the urban landscape of the "Skid Rows," which, from the late 19th to mid 20th century, had provided both access to cheap shelter and jobs for the unskilled. Although mostly substandard, "flophouses" and cubicle hotels had offered cheap overnight shelter to the vagrant and migrant population, of which only a small proportion were actually homeless and slept out on the streets.

According to Rossi, the urban renewal that took place during the late 1950s to early 1970s removed the cheap substandard housing but did not replace it with affordable accommodation:

One must remember that homelessness is a housing problem: homelessness on the scale seen today is in large part an outcome of the shortage of inexpensive housing for the poor, a shortage that began in the 1970s and has accelerated in the 1980s.(2)

The rise in the number of homeless people has resulted in two opposing trends observed in the U.S. in recent years: an inadequate stock of inexpensive housing for the poor and a rise in the number of urban households living at or below the poverty level. Rossi cites the levelling off or reduction in federal funding for the construction of public housing or to provide housing subsidies to the poor as being one reason for the decline in the stock of inexpensive housing.

As a result of the disappearance of cheap housing, the poor must pay a larger proportion of their limited income for shelter, or, if their income is insufficient or non-existent, be pushed out of the housing market altogether.

Skid Row also played an important role by acting as a pool of unskilled labour for employers who needed temporary workers, usually on a seasonal basis. A major factor in the decline of these neighbourhoods was the shrinkage of the casual labour market in urban economies, a phenomenon observed throughout the United States between the 1950s and 1970s. Rossi cites a 1980 study by Barrett Lee that analysed Skid Row populations in 41 U.S. cities during that period. The study showed that, as the proportion of each city’s labour force employed in unskilled and service occupations declined, so did the population of Skid Row.

In the earlier decade of the analysis, urban employers needing muscle power to wrestle with cargo apparently put up with the low productivity of Skid Row men because they could be hired as needed and at low wages. The advent of forklift tractors and other highly efficient materials-handling technology meant that casual labourers were no longer cost-effective; the declining demand for casual labour put the homeless and Skid Row out of business. The continuing lack of demand for unskilled labour still contributes to today’s homelessness and helps account for the poor employment and earning records of the homeless. But there is another element involved, one that also helps us understand the declining average age of homeless persons. The past decade has seen a bulge in the proportion of persons between the ages of twenty and thirty-five, a direct outcome of the post-war baby boom. The consequence of this "excess" of young persons, especially males, was a depressed earnings level for young adults, and an elevated unemployed rate.(3)

During the mid-1960s to the mid-1980s, the earnings profiles and employment opportunities for U.S. workers aged under 35 deteriorated at the same time as the homeless population increased and its average age declined. These developments in demographic and labour market trends had serious consequences for the formation of households and families. The rise in single parent households observed in recent decades, particularly of such households headed by women, results partly from the deterioration of the economic prospects of young men. Young men facing uncertain economic prospects are less willing to form households, and less able to take on the economic role of husbands and fathers.

One commonly held view is that homelessness grew appreciably or became more visible when psychiatric institutions began releasing mental patients from long-term care and residency, a practice that became known as "deinstitutionalization."

Deinstitutionalization can, however, at best be a partial explanation of homelessness since it did not happen abruptly but began gradually in the late 1940s to early 1950s and culminated in the late 1970s and early 1980s. In other words, how can a phenomenon that started 40 years ago contribute to a rise in homeless that was observed in the 1980s?

In his book The Homeless, Christopher Jencks argues that deinsti-tutionalization in the U.S. did contribute to the increase in the homeless population, but only after 1975, when mental hospitals were forced to discharge large numbers of the more disturbed patients who would previously have remained hospitalized. In the past, former mental patients found shelter with their families or in nursing homes or cheap lodging houses. In the 1960s and 1970s, however, the supply of such housing began to decline and, by the early 1980s, as demand for cheap housing picked up, had vanished. Jencks goes further, and implies that, while those discharged before 1975 were released on scientific grounds (e.g., psychotropic drugs, community psychiatry), post-1975 discharges were motivated by cost-cutting or budgetary concerns.(4)

Brendan O’Flaherty contradicts Jencks’s thesis, however, and provides empirical evidence to suggest that the contribution of deinstitutionalization to homelessness was marginal at best. According to O’Flaherty, deinstitutionalization of the mentally ill took place between 1960 and 1975 and many of the former patients found private housing; after 1975 the movement out of mental institutions was more than offset by the movement of the mentally ill into nursing homes and prisons.(5)

Another possible cause of homelessness is abuse of drugs and alcohol. Statistical surveys on the homeless population repeatedly indicate that significant minorities within it suffer from chronic alcoholism or abuse drugs. Rossi stresses that two-thirds of the homeless are not mentally ill, three-fifths are not alcoholics, three-fifth do not suffer from disabling physical disorder and 90% do not abuse drugs. While those who suffer from substance abuse do constitute large and significant minorities, they are minorities nonetheless.

There is considerable disagreement as to the importance of substance abuse in contributing to homelessness. Substance abuse does seem to play a role in maintaining the homeless on the streets, however, by further reducing their employability, eroding their already meagre incomes, and estranging them from friends and families, who would otherwise be more willing to provide shelter and assistance.

In The Homeless, Jencks partly attributes the rise in the numbers of homeless adults in the 1980s to poorly planned deinstitutionalization of mental patients and the spread of crack cocaine. Given that a significant proportion of the homeless population use drugs or alcohol, Jencks argues that: "Whatever their current budget looks like, we have to assume that a significant proportion of today’s homeless will spend any additional cash they receive on drugs and alcohol."

O’Flaherty challenges this view, arguing that deinstitutionalization and substance abuse may have played only a negligible role in the rise of homelessness. According to O’Flaherty, 5 to 7% of single adults in shelters are "occasional" heroin users. The introduction of low-cost crack cocaine as a substitute for the more expensive heroin may have increased the single-adult homeless population by approximately 5 to 7%. The drug user can choose from among three possible courses: spend less on drugs and more on housing; spend more on drugs while keeping constant the amount spent on housing; or spend more income on crack cocaine and less on housing. If the first effect dominates the third, in that money is spent on crack cocaine rather than heroin, the result could even be a reduction in the homeless population. Overall, O’Flaherty argues, the contribution of drug use to homelessness is very likely to be modest to marginal.

O’Flaherty in Making Room: The Economics of Homelessness, links the recent rise in the numbers of the homeless to changes in the distribution of incomes and to housing prices that have escalated at the expense of the very poor and low middle class.(6)

From income, housing and homelessness statistics for three American cities, O’Flaherty deduced that homelessness had risen fastest in cities where the size of the middle class had shrunk the most.

O’Flaherty argues that, as their incomes rise, families move up to better housing and their old accommodation is handed down the economic ladder. When, during the 1980s, America’s lower-middle class did badly, the average lower middle class family could not afford to move up, so its housing was not available for a poorer family. He says, "Income distribution changed, this changed housing prices; changes in housing prices caused homelessness. In turn, homelessness caused shelters and shelters caused more homelessness."

(1) Barrett A. Lee, "The Disappearance of Skid Row: Some Ecological Evidence," Urban Affairs Quarterly 16, No.1, September 1980, 81-107.

(2) Peter H. Rossi, Without Shelter: Homelessness in the 1980s, Priority Press Publications, New York, 1989, p. 31.

(3) Ibid., p. 35.

(4) Christopher Jencks, The Homeless, Harvard University Press, 1994.

(5) Brendon O’Flaherty, Making Room: The Economics of Homelessness, Harvard University Press, 1996.

(6) O’Flaherty (1996).