How does a thriving economy lead to more homelessness?

When most people think about homelessness, they think about poverty. It makes sense: if someone doesn't have money, they don't have housing. 

So there must be a correlation between disadvantaged communities and the number of residents who fall into homelessness, right? And if that’s the case, why is there so much homelessness in cities that also have experienced economic success like Los Angeles, San Francisco, and New York City?

At City Relief, we've been serving in the wealthiest city in the world since 1989. For decades, we’ve witnessed firsthand how homelessness persists even as the average median income has soared. In fact, since 1989, median household income in New York has risen by nearly 175%. And yet, homelessness hasn't gone away, it has grown more visible and more entrenched.

Many assume this persistence must be driven by crime, drugs, or mental illness. Those struggles are real, but they're not the whole story.

The deeper truth is that homelessness often rises and falls with the economic tides. As neighborhoods boom and investment flows in, housing prices climb. Wealth lifts some people higher, but for others—especially those working low-wage jobs that keep the city running—it pushes them further down.

As journalist Brian Goldstone wrote in his book There Is No Place for Us, "People with full-time jobs cannot keep a roof over their head… These families are being forced into homelessness not by a failing economy but a thriving one."

Think about it. The more desirable a city becomes—new restaurants, tech jobs, young professionals moving in—the higher the rents go. But wages for service workers, cashiers, childcare providers, and health aides remain largely the same. The result is predictable: those who sustain the city can no longer afford to live in it.

This isn't about laziness or bad choices. It's about math. The cost of living outpaces wages, and no amount of hard work can close that gap.

At City Relief, we meet neighbors every week who are working—sometimes multiple jobs—but still can't secure stable housing. They're not falling behind because they don't care or aren’t trying. They're being priced out by forces far beyond their control.

Homelessness is about what happens when prosperity is unevenly distributed. When the same economic waters that create abundance for some become overwhelming currents for others.

Let’s remember that thriving cities should not mean displaced neighbors. Each of us has the opportunity to slow down, pay attention, and let awareness move us toward compassion.

With gratitude,

Josiah Haken

City Relief, CEO