Broadly shared local economic success since 2000: New measures and new lessons for communities - Tim Bartik

Presentation by Tim Bartik, Senior Economist, W.E. Upjohn Institute for Employment Research, United States at the 23rd Spatial Productivity Lab meeting "Deindustrialisation and regional transitions: How can places transform leaving no one behind?", held in webinar format on 9 October 2024. More info https://www.oecd.org/en/events/2024/10/Deindustrialisation-and-regional-transformation--How-can-places-transform-leaving-no-one-behind.html

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Broadly Shared Local
Economic Success: New
Measures and New Lessons
for Communities
Presentation at OECD Spatial Productivity Lab
webinar. Full report is here:
https://research.upjohn.org/reports/296/
Tim Bartik
Senior Economist, Upjohn Institute
October 9, 2024

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Key Points
•U.S. “commuting zones” (CZs) have large disparities in real earnings
growth
•CZ real earnings growth trends vary considerably across education and
racial groups
•Descriptive regressions suggest disparate determinants for different
groups
•Case studies suggest investing in re-deploying area’s special assets
•Racial disparities require special attention

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Results for 8 CZs (out of 371 considered)
Real earnings % changes for various groups relative to U.S., 2000 to 2019, adjusted for demographics
Commuting
zone
Population
(in millions)Sub-BA BA+ Black White
San Francisco, CA5.101 2.4 11.8 −8.4 8.7
Minneapolis, MN 2.946 8.8 7.7 16.8 5.9
Detroit, MI 5.077 −14.7 −8.3 −15.7 −9.7
Pittsburgh, PA 2.603 21.2 1.4 −3.2 12.7
Buffalo, NY 1.408 10.9 0.0 12.4 6.1
Bakersfield, CA

1.159 −21.3 −1.2 −46.8 −13.4
Salt Lake City, UT1.826 13.3 1.6 29.7 4.4
Miami, FL 3.956 −11.8 −10.9 −7.4 −10.1

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Descriptive regressions find diverse predictors
of different groups’ trends
•Predicted shocks to job growth & wages (based on industry mix)
have large effects on sub-BA & white workers, little effect on BA+
or Black workers
•Baseline CZ college grad share of population predicts earnings
growth only for BA+ workers
•CZs with high %Black pop share at baseline associated with slower
earnings growth for Black & white workers, sub-BA workers

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What works? Grand Rapids, MI suggests redirecting
manufacturing to growing industries (e.g., health) can work
0
20
40
60
80
100
120
140
1990 1995 2000 2005 2010 2015 2020
Manufacturing job trends in Grand Rapids vs. U.S. (1990=100)
Grand RapidsUnited States

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What works? Crosby/Ironton, Minnesota took abandoned
open pit iron mines, developed mountain biking trails

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What works? Neighborhood Hubs in Battle Creek, Michigan
Neighborhood hubs
provide employment and
other social services
jointly at a neighborhood
location and are often
staffed by neighborhood
residents.

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Summary
•Growth in local real earnings for BA+ group often has little to do with
growth in real earnings for sub-BA group or for Black workers
•Growth in local real earnings for sub-BA group not closely related to
earnings growth for Black workers
•Case studies suggest overall growth in threatened local economies can
occur by redeploying local assets into growth areas
•Growth must be better linked to Black workers, possibly via
neighborhood interventions