How Place Matters for Chicagoans’ Economic Mobility

Many recent federal policies have been shaped around the notion that a child’s ZIP code should not determine their chances for success in life. Yet today, in the Chicago region, it does.

On Monday, July 25, more than 200 participants joined The Chicago Community Trust, the MacArthur Foundation, Metropolitan Planning Council and the Urban Institute to discuss how some places limit economic opportunity for residents, and how a place—a community, a neighborhood or an entire city—can create pathways out of poverty.

The summit, titled “How Place Matters for Economic Mobility,” began with a look at the research thanks to Dr. Raphael Bostic, an economist at the University of Southern California and former assistant secretary for the U.S. Dept. of Housing and Urban Development.

Bostic discussed a 2014 study by Raj Chetty and Nathaniel Hendren of Harvard University which tracked income records of more than 40 million children and their parents across the United States. The study found that economic mobility varies dramatically across by city: Some cities have upward income mobility comparable to the most mobile countries in the world, while others have rates below that of any developed country.

Dr. Raphael Bostic, former assistant secretary for the U.S. Dept. of Housing and Urban Development, presented research on intergenerational mobility. While some American cities have upward income mobility comparable to the most mobile countries in the world, others have rates well below that of any developed country.

In the Chicago region, the study found that children in poverty born and raised in Cook County grow up to earn 13% less than the national average, while children in poverty born and raised in DuPage or Kendall Counties earn 15% more than the national average.

Throughout the day, panel sessions shared best practices in targeted and cross-sector work to make it easier for people in poverty to move to areas of opportunity, and to bring inclusive investments to underserved places through responsive business models, improved school options and quality housing. Experts explored new responses to growing income segregation, and ways to create dynamic, opportunity-rich local and regional markets.

[pullquote]Children born in poverty in Cook Co. earn 13% below US avg as adults; DuPage/Kendall kids earn 15% over[/pullquote]

Atif Bostic, executive director of UpLift Solutions, discussed his work to build sustainable, affordable supermarkets in food desert neighborhoods, providing fresh food, health services, jobs and entrepreneurship opportunities.

Recognizing that the local grocery store serves as a hub and anchor in communities, UpLift brings complementary programs and services into their stores, such as financial services and healthcare clinics with on-site nutritionists, dietitians and community health navigators. These services benefit the grocer by bringing in rent, while fostering healthier and more financially stable customers and workers. UpLift also partners with local entrepreneurs to stock their products, and works to employ previously incarcerated and low-literacy job seekers.

Chicago Neighborhood Initiative (CNI) is driving community and economic development in the Calumet region and ensuring that each project brings substantial community benefits. With their support, Method Products Inc. opened its national plant and distribution center in Pullman two years ago. Method has hired 50% of its workers from the local community; 35% are women or minorities.

CNI also helped to attract the first Wal-Mart to Chicago and recently announced plans for a Whole Foods warehouse. Wal-Mart has signed a community benefits agreement, providing entry level work at $10.50/hour; 80% of its hires are from the local community.

Experience the event’s key voices and ideas in this video from Urban Institute

During a panel on education, Principal Robert Croston of Jenner Academy of the Arts led a discussion of the merger between Jenner and Ogden International elementary schools. The proposed consolidation is an important proposal to tackle education inequalities between Chicago’s Gold Coast and Cabrini-Green neighborhoods.

Panelists explained how both schools would benefit from the merger: Jenner’s under-enrollment has reduced the quality of academic options offered; Ogden currently faces overcrowding, losing its art rooms and science labs as they’re converted into homeroom spaces to fit its student population.

The stark reality of school quality in privileged urban districts compared to poorer, underfunded districts is exemplified in these schools. So, too, are the political considerations that shape decision-making and adversely influence students’ education.

“If you learn together, you learn to live together. Funding alone can’t fix racism—but having a mixed income, mixed race school system could be the key to teaching children at a young age how to live, work, play together.” -Former U.S. Secretary of Education Arne Duncan, in the summit’s keynote address

The Jenner-Ogden proposal would serve as a rare win-win, according to former U.S. Secretary of Education Arne Duncan.

In his keynote address, Duncan challenged Chicago to lead and provide equal opportunity for all children. “If you learn together, you learn to live together. Funding alone can’t fix racism—but having a mixed income, mixed race school system could be the key to teaching children at a young age how to live, work, play together.”

The Chicago Community Trust’s president and CEO Terry Mazany challenged the audience that it will be impossible to address economic mobility without fundamentally attacking structural racism in our region: a reoccurring theme by many panelists throughout the day.

In her closing remarks, Marisa Novara of the Metropolitan Planning Council discussed MPC and Urban Institute’s two-year Cost of Segregation study, based on the hypothesis that by reducing its profound neighborhood segregation, Chicago and our region will experience faster economic growth and a more equitable quality of life.

By examining how segregation holds us back and continues to drive population loss, the hope is that our region will unite around sound strategies to right decades of lost opportunity and economic stagnation in communities across Chicago.