Addressing Barriers to Economic Mobility

Addressing Barriers to Economic Mobility

Increasing access to affordable housing in opportunity-rich areas promises to fuel economic mobility.

In September 2016, researchers, policymakers, and practitioners convened for “Promoting Economic Mobility: Putting Evidence to Action for Communities,” a conference hosted by the Urban Institute and the Citi Foundation. Although some cities are experiencing economic growth, this growth does not necessarily guarantee economic inclusion. From 2009 to 2014, 95 out of 100 of the nation’s largest metropolitan areas experienced economic growth, but only in 8 of these areas did this growth translate into higher median wages and rising employment, according to the Brookings Institution. As Urban Institute President Sarah Rosen Wartell acknowledged, the “rising tide [of economic growth] is not lifting all boats.” Wartell and the other conference speakers discussed how better addressing issues such as food security, affordable housing, labor protections, and criminal justice reform can promote economic mobility and to ensure that economic growth is more equitable.

Making strides for place-based problem solving

A focus on place-based problem solving enables practitioners to tailor policies to a particular context, thereby ensuring that residents can climb the ladder of opportunity. A community-driven approach that gives individuals a voice can illuminate context-specific needs that a top-down approach might overlook, according to U.S. Office of Management and Budget Director Shaun Donovan. Instead of just moving people to other areas of opportunity, Donovan suggested that policymakers customize the way that the federal government works in distressed places. Donovan discussed food security to illustrate his point about making federal approaches more specific to local context.

The Supplemental Nutrition Assistance Program (SNAP) is effective in mitigating food insecurity, according to Donovan, but could be even more effective through place-based approaches. Federal programs are not necessarily tailored to contextual characteristics such as local eligibility requirements or processes for distributing aid. Data from the U.S. Department of Agriculture’s Economic Research Service show that the number of U.S. households experiencing food insecurity declined 12.7 percent between 2014 and 2015. Yet the level of food insecurity in 2015 is still higher than the prerecession level of 11.1 percent in 2007. Place-based approaches could reduce these numbers even more by adapting to fit the ways food assistance programs work on the ground.

Creating Sustainable Neighborhoods

Boosting the supply of affordable housing in opportunity-rich areas allows people to access jobs, higher-performing schools, and social amenities, all of which influence economic mobility. Panelists described three overarching housing challenges: first, expanding the availability of affordable housing in opportunity-rich environments; second, revitalizing distressed areas; and third, preserving affordable housing for future generations, including in areas of opportunity.

To foster economic mobility, Donovan recommended more “federal levers on land use” through grant stipulations requiring communities to have plans that account for inclusionary zoning, fair housing, and access to transit. Jacqueline Alexander, director of development for The Community Builders, Inc., suggested that neighborhood revitalization requires recognizing that diverse incomes along with job training, mental health counseling, and child care assistance can increase property values and stabilize neighborhoods. Despite “not in my backyard” opposition to the construction of high-density housing, panelists sought to dispel the notion that more inclusion undermines an area’s success.

Carol Galante, faculty director of the Terner Center for Housing Innovation at the University of California, Berkeley, suggested that practitioners consider ways to create access to housing within existing housing stock by preserving what is already available. Galante also supports rental subsidies to allow residents to stay in their neighborhoods despite rising rents. Galante’s opinion dovetails with D.C. Deputy Mayor for Greater Economic Opportunity Courtney Snowden’s point to allow residents to “gentrify in place” and reap the benefits of economic growth, rather than being forced out due to rising rents.

Prospects for Economic Mobility in Low-Skilled Labor Markets

Policies that improve labor protections for low-skilled workers through employer-provided health care, paid leave, and workers’ compensation alleviate barriers to economic mobility. As Conor McKay, director of the Future of Work Initiative at the Aspen Institute, emphasized, economic mobility is contingent on the employee-employer relationship — the means through which workers receive training, benefits, and protections. McKay advocated reinventing the social contract so nontraditional workers — who often work multiple jobs as part-time, seasonal, contract, or temporary employees — can receive the same benefits of mainstream full-time employees.

The panelists provided two examples of industries in which worker protections can be improved to ensure economic mobility. Teófilo Reyes, national research director at Restaurant Opportunities Centers United, said that despite the food service sector’s upward growth path, it remains among the lowest-paying industries in the United States, requiring people to work unpredictable schedules and multiple jobs to make ends meet. Caregivers and housekeepers also have unpredictable work schedules and few benefits. Palak Shah of the National Domestic Workers Alliance (NDWA) specified that these are typically the first jobs for immigrant women, a large portion of whom are undocumented. In 2012, 23 percent of domestic workers were paid less than the state minimum wage.

Panelists discussed technological possibilities to bring service jobs out of the shadows. Growing demand for home care among aging baby boomers makes websites such as Care.com appealing. To facilitate hiring, online platforms can potentially eliminate the racial bias that occurs in face-to-face interactions. However, some people may still demonstrate racial preference based on a name or profile picture. The National Diners’ Guide mobile app directs patrons to restaurants that provide employee benefits. Restaurants with poor labor practices might experience decreased revenue once consumers develop awareness.

Criminal Justice Reform as a Source of Inclusion

Reforming the criminal justice system by promoting positive learning environments and helping ex-offenders find stable housing offers children the opportunity to realize their full potential and former inmates a second chance to become productive citizens. In her keynote, U.S. Attorney General Loretta Lynch discussed the interrelationship between criminal justice policy and economic mobility. Growing up in safe neighborhoods, without gun and gang violence, directly influences a child’s future educational attainment, income, and contribution to society.

Lynch announced several collaborative efforts between the U.S. Department of Justice (DOJ) and the White House. DOJ’s Project Safe Neighborhoods is providing more than $5 million in grants to 16 jurisdictions nationwide to mitigate gang and gun violence. Lynch also announced more than $67 million in grants to 25 districts nationwide for the Comprehensive School Safety Initiative, which works with educators, law enforcement, and mental health providers to ensure that “students can study in secure and positive environments that offer a gateway to opportunity — not a pipeline to prison.”

For those who do become entangled in the criminal justice system, reforms should focus on ensuring that formerly incarcerated individuals reenter public life with skills to lead successful lives, Lynch said. The Federal Interagency Reentry Council has partnered with the U.S. Department of Education to provide Pell grants to current inmates. Partnerships with the U.S. Department of Housing and Urban Development have helped identify stable housing options for former inmates because, as Lynch stated, “a home connects one to the community.” DOJ has also partnered with the U.S. Department of Labor on the National Clean Slate Clearinghouse to expunge records, thereby reducing barriers to employment and housing for former inmates. Such initiatives reduce recidivism and help these individuals reintegrate into society.

Ways Forward

Reducing barriers to economic mobility through food security, affordable housing, labor protections, and criminal justice reform is critical to ensuring the economic inclusion of traditionally marginalized groups. Pathways to the middle class through well-paid jobs and affordable housing are vital for achieving economic mobility, said Snowden. As Donovan emphasized, practitioners and policymakers must become “partners in problem solving,” working closely with local communities to tailor federal initiatives to particular places.