At the beginning of April, the Federal Reserve Bank System hosted academics and policymakers at a Conference on Economic Mobility, which examined research on how families, communities, and the economy impact economic mobility and sought to apply that research to policy and practice. I went to DC to see what they had to say about mobility for Southern communities.
If you’re a regular reader of this blog (and you are, aren’t you?) you know that in the US, your starting point as a child greatly impacts your chances of getting ahead as an adult. Geographic variation in levels of economic mobility is significant, meaning, the chances of someone born in a lower portion of the income distribution moving up it as an adult vary by place. Raj Chetty, one of the conference keynotes, reminded the crowd that while some areas of the US are comparable with highly mobile places like Canada, much of the South has levels lower of income mobility than any developed country we have data on. Chetty’s research shows us that not all young people have an equal chance of success. As we wrote in the State of the South:
Prospects for Southern youth and young adults […] are widely variable, depending on the circumstances of their birth, the inclusiveness of their communities, the dynamism of the economies in which they function, and the quality of the education and workforce systems that serve them.
Throughout the hotel conference rooms, a familiar refrain was the importance of place in assessing and improving economic mobility. Fed Chair Janet Yellen opened the conference with that theme, asking, “how do some places advance economically and create circumstances in which residents, in turn, are more likely to thrive?” Place matters because the history of a community impacts its current structure; wages, occupation types, economic segregation, resource allocation for public services, and wealth distribution all follow the pattern of a place’s particular history of social exclusion and economic exploitation. Place matters because many of the interventions we can make to improve economic mobility are within the sphere of control of local actors.
While the Equality of Opportunity Project’s research on the geographic variation of income mobility doesn’t demonstrate causal links (meaning, the research doesn’t speculate on why a particular place has low or high mobility), it does find strong correlations between five factors and the level of income mobility: economic segregation, social capital, family structure, income inequality, and school quality. Again, this doesn’t necessarily mean any of these factors are causing low mobility; it’s likely that the historical and economic factors that led to low mobility in a place have also contributed to disparities, like lower quality schools or concentrated poverty.
Research has clearly established the geographic variation of income mobility, but debate about how to intervene to improve mobility is much less conclusive. Several conference presenters looked at the school quality factor: would policies to improve school quality—which is highly variable by place—improve mobility? One of those presenters, Rucker Johnson of UC Berkeley, is trying to address that question by examining equal opportunity school interventions, like desegregation and school finance reform. He used the variability in timing and intensity of the rollout of those policies across geographies to examine the reforms’ influence on mobility. His research shows that as schools desegregated, income mobility for black children improved; as schools increased spending following court-mandated changes to school funding formulae, low-income students saw long-run improvements in educational attainment and wages.
When Isabell Sawhill of the Brookings Institution spoke at the conference, she pointed out that while educational quality matters tremendously to improving economic mobility, we can’t ask schools to shoulder the whole burden. She pointed out that we’ve been working on improving school quality for decades, and given continued low levels of mobility, we need to focus on what happens to kids outside of school. Sawhill is right to point out that schools can’t be the whole solution, but the research of Johnson and others directly contradicts a pervasive but false narrative about school reform: we’ve been trying everything we can to improve schools, but we’re only seeing marginal results. These efforts do have an impact on the opportunities young people connect to and we should continue to increase and expand them (instead, we’re rolling back progress).
Our education systems are heavily influenced by state and federal policies, but there are significant opportunities to improve school quality—and to connect education systems to economic opportunity—through local interventions. That’s why we’re proposing a new agenda for Southern leaders: to build strong place-based infrastructures of opportunity, consisting of a clear and deliberate set of pathways and supports that connect youth and young adults to educational credentials and economic opportunity. This work is already happening across the South, from Brownsville’s community partnership focused on improving postsecondary success, Durham’s effort to improve education-to-career pathways, and Greenville’s public-private partnerships to combat intergenerational poverty. Place-based efforts like these can lead the way—gridlock willing—to broader policy change at the state and federal level.