October 28, 2015

David DodsonPresident, MDC

Building an Infrastructure of Opportunity in North Carolina

The American Dream

How many of you believe that where a person starts in life shouldn’t determine

where they end up?

Complex Landscape, Common ChallengeLack of Mobility: The South stands out

Source: Equality of Opportunity Project data

At the root of the uncertainty lies a pervasive doubt: whether the nation can sustain the American Dream of each generation moving up and doing better than previous generations.

Today we will consider:•What are the current patterns of economic mobility in North Carolina, and what levers can provide economic uplift broadly?

•Who in this region is stuck with limited economic opportunity, and who is on the path to success?

•How can young people growing up in this region access opportunity and participate in future prosperity?

Stuck in PlaceAnnual growth rate of real income across the family income distribution, national

Source: Alan Krueger, Chairman of the Council of Economic Advisers

Upward Mobility

“Inequality would not be a problem if upward mobility were strong in America.”

--Robert Reich, former U.S. Secretary of Labor

Growth and Low MobilityThe paradox of the metro South, 100 Largest Metros

Sources: Forbes, Equality of Opportunity Project, Trulia, Brookings, and U.S. Census Bureau

Forbes Best for

Business Mobility Poverty

Rate

Increase in

Poverty Since 2000

Raleigh, NC 1 94 12.0% 96.8%

Nashville, TN

6 78 14.0% 66.7%

Charlotte, NC

7 98 14.0% 97.4%

Dallas, TX 8 55 14.4% 64.4%

Atlanta, GA 9 96 14.5% 89.9%

Economic Mobility in N.C.What are the chances a child raised in the lowest fifth of the income distribution will rise to the top fifth as an adult in each North Carolina commuting zone?

Commuting Zone

Chance of Rising

Rank out of 729 Zones (#1 is worst)

Fayetteville 3.8% 36

Charlotte 4.4% 53

Winston-Salem 4.5% 58

Raleigh 5.0% 85

Asheville 6.3% 159

• The best mobility in large US commuting zones? In San Jose, CA, a young person has a 12.9 percent chance of rising from the lowest to the highest quintile.

• The worst mobility in large US commuting zones? In Memphis, TN, a young person has a 2.8 percent chance of rising from the lowest to the highest quintile.

Source: Equality of Opportunity Project

Economic Mobility in the TriangleWhat are the chances a child raised in a given quintile of the income distribution will move to another quintile as an adult in the Triangle?

Parent q1 Parent q2 Parent q3 Parent q4 Parent q5

39%28%

20%14% 12%

30%

27%

21%

17%13%

17%

21%

23%

22%

18%

10%14%

20%

23%

24%

5% 9%16%

24%33%

Child q5Child q4Child q3Child q2Child q1

Source: Equality of Opportunity Project

Median Household Income by Race and Ethnicity

Source: U.S. Census Bureau, American Community Survey, Five-Year Averages

All Households Black or African American

Hispanic or Latino origin (of any race)

White alone, not Hispanic or Latino

$45,696

$31,912 $34,404

$51,808 $52,176

$34,560 $41,107

$57,431 North Carolina United States

Income Mobility, by EducationChances of moving up or down the family income ladder

Source: The Pew Charitable Trusts

Based in part on a Bill & Melinda Gates Foundation model

PreparationObtain secondary

skills and motivation for postsecondary

success

ConnectionUnderstand

application process and financial aid

EntryEnroll, obtain

financial aid, pass assessments, and

complete orientation

ProgressComplete courses and accumulate

credits

CompletionComplete course of

study and attain credential

EmploymentObtain a living wage

job with opportunities for career

advancement

Preventing Loss, Creating MomentumA systems view

Barriers to BelongingRace and the concentration of poverty in schools, 2013

Source: Urban Institute and Southern Education FoundationNote: high-poverty schools are schools where more than 75 percent of students come from low-income families. Low-income students are ones who are eligible for free-or reduced-price lunch.

Share of public school

students from low-income families

Share of low-

income students in high-poverty schools

Share of non-low-income

students in high-poverty schools

Share of black

students in high-poverty schools

Share of white

students in high-poverty schools

Mecklenburg 54% 54% 9% 49% 6%

Wake 34% 11% 1% 9% 1%Guilford 57% 49% 9% 46% 9%Forsyth 54% 40% 4% 36% 4%

Cumberland 58% 27% 8% 27% 9%Durham 61% 42% 9% 36% 6%

Buncombe 54% 6% 1% 8% 2%Gaston 57% 31% 7% 38% 13%

New Hanover 46% 27% 4% 35% 6%

Union 34% 31% 2% 32% 2%

Barriers to BelongingOverall economic segregation index

Source: Martin Prosperity Institute

Barriers to BelongingPercentage of the population under the poverty lineliving in high-poverty neighborhoods

Source: The Century Foundation using U.S. Census Bureau American Community Survey data

Total White Black Hispanic

15.1

6.3

30.4

21.2

10.3

4.1

18.6

13.811.9

6.5

21.7

13.214.4

7.5

25.2

17.4

1990 2000 2005-2009 2009-2013

Clustering and Fragmenting

• Bill Bishop’s The Big Sort: We’re increasingly living in “balkanised communities whose inhabitants find other Americans to be culturally incomprehensible.”

• Bonding, bridging, and linking social capital

• Amb. James Joseph: Smaller communities of “meaning and memory”

• Experiential and economic clustering/isolation

Upward Mobility

• What is your family’s mobility story?

• What is the role of education, opportunity, and place in that story?

The Path to PossibilityProspects for young people are widely variable, depending on the circumstances of their birth, the inclusiveness of their communities, the dynamism of the economies in which they function, and the quality of the education and workforce systems that serve them.

How do we make sure all of these factors are consistent in the lives of young people so that those who start at the bottom of the income ladder can rise and thrive?

Based in part on a Bill & Melinda Gates Foundation model

PreparationObtain secondary

skills and motivation for postsecondary

success

ConnectionUnderstand

application process and financial aid

EntryEnroll, obtain

financial aid, pass assessments, and

complete orientation

ProgressComplete courses and accumulate

credits

CompletionComplete course of

study and attain credential

EmploymentObtain a living wage

job with opportunities for career

advancement

Transportation

Career & Academic

Counseling

Living Wage Employment

Policies

Work Support

sCultural Messages

& Media Representations

Preventing Loss, Creating MomentumCommunity systems context

Institutional & Public Policies

Housing

• It is the systems and supports needed to boost young people to higher rungs on the ladder of economic and personal advancement.

• It includes employers, education systems, community-based organizations, policy makers, civic and neighborhood leaders, philanthropy, and young people themselves

• It engages them all to foster a common strategic vision of aims and outcomes for education and training systems

What is the Infrastructure of Opportunity?

• It takes advantage of local assets and addresses the community’s distinctive challenges

• It should be as pervasive and reliable as the physical infrastructure of roads and water lines

What is the Infrastructure of Opportunity?

Complex Landscape, Common ChallengeLack of mobility: The South stands out

Source: Equality of Opportunity Project data

307 West Main StreetDurham, NC 27701-3215

Phone: 919.381.5802Fax: 919.381.5805

www.mdcinc.org www.stateofthesouth.org