New Research, analyzing census data and other quantitative data sources, shows that children in the south face the steepest climb when attempting to escape poverty. The ability to move up the income ladder, otherwise known as income mobility, is a reliable measure of economic mobility or the ability to change one’s overall economic status. New research by Raj Chetty, Nathaniel Hendren, Patrick Kline, and Emmanuel Saez, sponsored by the University of California Berkeley and Harvard, looked at how tax expenditures affect inter-generational income mobility.
The main part of their research involved looking at the income of adults (30 or older) in comparison to the income of their parents. The research paints a startling picture of trying to escape poverty and climbing the income ladder. When it comes to economic mobility, being born in the right part of the country definitely helps.
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. Read full New York Times article
In southern Cities like Atlanta, a child born into a family in the 20th percentile ($25 K) or lower will on average will only climb to the 35th (42 K), and only 8 % of children at this level will ever be considered a top earner at $107 K or more. Atlanta though isn’t the worst place for income mobility, in the greater Eufaula area of Georgia a child only has a 2.7% of climbing from the bottom fifth to the top fifth of the income distribution. Georgia, Louisiana, and the Carolina’s have the lowest rates of income mobility.
The New York Times article includes interactive maps where you can view the income mobility rates for different areas and starting income levels, to see what the average earnings a child from that background will have by the time they reach 30.
So what does all this mean? It means that economically disadvantaged families in the south are less likely to escape the cycle of poverty than families in the midwest, northeast, or western parts of the country. Notable exceptions to this include the areas near:
- Detroit, Grand Rapids, and Kalamazoo Michigan
- Cleveland, Columbus, Ohio
- Indianapolis, Indiana
- Chicago, Illinois
- Milwaukee, Wisconsin
- Nome and Bethel, Alaska
- Mission, South Dakota
View the Truth and Hope Poverty Tour of North Carolina video for more information.