Economic activity within metropolitan areas in the United States tends to be distributed unevenly. Within nearly any city, there are neighborhoods that grow—attracting businesses that provide jobs, goods and services—and there are those that do not. Why are some neighborhoods more conducive to economic development than others?
Employment growth is one of the most fundamental aspects of a strong economy. Yet not all jobs are created equal. Some pay generously and offer desirable working conditions, while others do not. A study by Federal Reserve Bank of St. Louis economist Christopher H. Wheeler examined the growth of high-paying ("good") and low-paying ("bad") jobs across a sample of 206 metropolitan areas in the United States. This study suggests that the nature of jobs held by workers influences a variety of economic and social outcomes.
Surveys often find that, among the many issues Americans deem important for the current and future well-being of the country, job growth ranks near the top. Employment, after all, confers enormous benefits to individuals, both economic (e.g., jobs provide an income) and otherwise (e.g., employment gives workers a sense of purpose and satisfaction) and, subsequently, to their communities.
Unemployment is becoming more concentrated. Neighborhoods that had high unemployment in 1980 had even higher unemployment 20 years later. What are the possible reasons—and solutions—for this trend?
Thirty years ago, the "haves" in the St. Louis Fed's District earned 3.7 times what the "have nots" earned. Today, the "haves" make 5.2 times as much. Education is just one of the reasons behind the widening divide.