Movin’ on Up: Income Mobility Depends on Where You Live

7.25.13 | A new study lays bare a disturbing truth: Where you live seems to greatly affect your upward mobility. And if you live in the Midwest or Southeast, your odds of moving up are not good.

The New York Times published a fantastic breakdown of the study (Slate.com’s story is the only other news citation posted at the Equality of Opportunity Project site; apparently the birth of another country’s third-in-line-to-a-throne was more important to the US news media). Here’s what the Times had to say:

“The study—based on millions of anonymous earnings records and being released this week by a team of top academic economists—is the first with enough data to compare upward mobility across metropolitan areas. These comparisons provide some of the most powerful evidence so far about the factors that seem to drive people’s chances of rising beyond the station of their birth, including education, family structure and the economic layout of metropolitan areas.”

I suspect the findings are going to reverberate across the country and shake a lot of political assumptions—blue and red—along with policies long considered as axioms. To wit:

The researchers concluded that larger tax credits for the poor and higher taxes on the affluent seemed to improve income mobility only slightly. The economists also found only modest or no correlation between mobility and the number of local colleges and their tuition rates or between mobility and the amount of extreme wealth in a region.

All else being equal, upward mobility tended to be higher in metropolitan areas where poor families were more dispersed among mixed-income neighborhoods.

Income mobility was also higher in areas with more two-parent households, better elementary schools and high schools, and more civic engagement, including membership in religious and community groups.

Regions with larger black populations had lower upward-mobility rates. But the researchers’ analysis suggested that this was not primarily because of their race. Both white and black residents of Atlanta have low upward mobility, for instance.

Moreover, the problem seems to lie not in ourselves, but in the character of the regions we inhabit, including geography, the strength of transit systems—or lack of them, and the dispersion of jobs.

But the study’s authors warn: “We caution that all of the findings in this study are correlational and cannot be interpreted as causal effects.”

The study finds that the cities where it’s hardest to rise above your birth were Atlanta; Charlotte, North Carolina; Cincinnati; Columbus, Ohio; Indianapolis; Memphis, Tennessee; and Raleigh, North Carolina. The cities where you get the best odds of rising? Boston, New York, Pittsburgh, Salt Lake City, and Seattle.

Lower income children in Los Angeles did better on average than other low-income kids, but the opposite is true in Chicago. Children raised in New York City were more likely to end up in the top quintile of income than children raised in families with the same income in most other major cities.

Among the handier readings to follow up on this topic, BRR’s Margaret Weir and Sarah Reckhow noted the links between resilience and a region’s civic capacity in the form of its social safety net.  In a chapter in Urban and Regional Policy and Its Effects, they note that nonprofits have become the main providers of social services to low-income families and the communities in which they live—services that might help them climb up and over the hurdles of poverty. But those nonprofits are often not located in the communities where need is greatest, especially in suburban communities, which are increasingly poor.

What is interesting about the study is that in Atlanta, the metro area where residents have the lowest odds of rising above the station of their births, philanthropies spend relatively little on low-income families. Given that, as the authors of the mobility study argue, civic engagement is one of the metrics that distinguishes locales from each other, this measure of philanthropic spending might offer a clue to why these mobility disparities exist.

Hopefully the Equality of Opportunity Project will launch follow-up studies that will guide not only national policies, but also the regional and metropolitan ones we discussed here only last week. Time will tell.

Photo/ Asim Bharwani

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