Geography is making America’s uneven economic recovery worse – Quartz
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This June, it will have been seven years since the official end of the “Great Recession,” which began in December 2007. Pundits and politicians continue to laud what US president Barack Obama called in February “the strongest, most durable economy in the world,” boasting of soaring stock prices and allegedly low unemployment. And yet, in 2008, 35% of Americans self-identified as “lower class.” In 2015, 48% of Americans claimed that title, according to a 2015 Gallup poll. Similarly, the number of Americans self-identifying as “upper-middle to middle class” dropped from 63% from 2008 to 51% in 2015.
What’s behind this discrepancy? For one thing, pundits and politician are unlikely to work in the regions where most Americans live. Cities where prestige industries like media, policy, and tech are centered—New York, Washington DC, San Francisco—have witnessed economic growth along with a skyrocketing cost of living. In fact, the vast majority of American wealth is clustered in a corridor of Northeastern cities stretching from Boston to Washington DC. The rest of the country, particularly most areas of the South and the Midwest, has seen massive job loss, while cost of living remains more affordable. A few southern cities, including Atlanta, Nashville, and Dallas, have boasted post-recession job growth. But even these tend to be are surrounded by rural regions mired in poverty.
In fact, the vast majority of American wealth is clustered in a corridor of Northeastern cities. In effect, we have two American economies. One is made up of expensive coastal zip codes where the pundits proclaiming “recovery” are surrounded by prosperity. The other is composed of heartland regions where ordinary Americans struggle without jobs. Over 50 million Americans live in what the Economic Innovation Group calls “distressed communities”—zip codes where over 55% of the population is unemployed. Of those distressed communities, over half are in the South, defined generously by the census as the region stretching from Maryland and Delaware to Oklahoma and Texas. The rest tend to live in Midwest rust belt cities that have long suffered from economic decline, like Gary, Indiana and Cleveland, Ohio. It is nearly impossible for Americans of the latter group to move to the cities of the former group—or to work in the industries that shape public perception of how the economy is going.
The result is the populist rage that has consumed the 2016 election, whether from left-leaning supporters of Sanders or right-learning supporters of Trump.
The unequal geographic recovery has put the average American in an impossible situation. Most cities that have thriving economies—coastal cities like New York or San Francisco, for example–have become exorbitantly expensive over the past decade, with rents tripling or even quadrupling, forcing lower-income residents to flee to the exurbs. Cities where rent is cheap—Midwestern cities like St. Louis, Missouri, or Southern cities like Jackson, Mississippi–have some of the worst economies in the country, ranking in the bottom ten of Brookings’ 2016 study on 2009-2014 job growth.
The unequal geographic recovery has put the average American in an impossible situation. The economic gulf between the coast and the heartland is a phenomenon that began in the Reagan era and accelerated during the Great Recession: in the late 1970s, per capita incomes in St. Louis and New York City were roughly the same. Today, a job has become less an indicator of where you are going, and more an indicator of where you come from: your geographic roots, your family’s social class, and how much money you have on hand to relocate—particularly in an era where unpaid internships or low-wage entry-level jobs are common in prestigious industries. Many Americans have no option but to remain where they are.
In 2015, the number of Americans who moved across state lines was reported to have fallen to a low not seen since 1947. Barriers to moving include a massive drop in personal savings: 62% of Americans have less than $1,000 and are unable to afford relocation costs. This was not always the case. Among those who had savings prior to 2008, 57% said they’d used some or all of their savings in the Great Recession. The soaring cost of living in cities with healthy economies combined with the low wages of America’s distressed heartland has locked many Americans in place.
What makes this discrepancy between the haves of the coastal cities and the have-nots of the heartland so distressing is that, in certain fields, it is avoidable. While digital technology has made telecommuting far more feasible than it was a decade ago, industries have instead tightened geographic requirements of residency since the Great Recession.
Today, a job has become less an indicator of where you are going, and more an indicator of where you come from. Journalism, for example, is an industry where writers and editors could easily work remotely. In 2004, one out of eight journalism jobs was based in New York, Washington DC, or Los Angeles—a high number even for that era. By 2014, that number had changed one of every four,even as the cost of rent in those cities rose astronomically, and the number of unpaid and low-paid positions exploded. This has led to journalism increasingly becoming an occupation of elites, with the reporters of the rest of the country underrepresented and the concerns of their communities underreported.
The technology industry operates in a similar fashion. The overwhelming number of jobs in tech are located in the San Francisco and Silicon Valley area. Industry experts recently boasted that they are expanding beyond their West Coast roots. But the cities where they invest most—New York and Boston—are also financially prohibitive for the average American to live.
And so the talent of the heartland is wasted as job-seekers from these regions remained trapped. And so the talent of the heartland is wasted as job-seekers from these regions remained trapped. For millennials, many of whom are saddled with massive college debt and are expected to complete unpaid internships, the situation is particularly dire. Moving to the city where their field is located can prove impossible without family wealth. Careers are ending before they have the chance to begin.
The unequal geographic recovery, and the centralization of industries like media and technology in the most expensive regions of the country, has serious ramifications for average Americans in a broader sense as well. These industries hold inordinate sway over policy-makers— who are similarly enclosed in the exorbitant DC bubble. Without an understanding of day-to-day life in the struggling communities that encompass the bulk of America, there is no chance of remedying problems through policy.
Today, heartland Americans use tech and media to describe their experience—in anguished tweets, in furious Facebook posts, in GoFundMe campaigns begging for money to cover healthcare and funeral costs. They detail their struggle using the tools of the industries that exclude them from employment. But is anyone listening to what they have to say?
Geography is making America’s uneven economic recovery worse – Quartz