Urban Institute

Even wealthy people in the suburbs.

Programs designed to help the poor must perennially contend with this awkward fact: We need people who aren’t poor to pay for them. And this is no easy sell. "They ask the question, 'what’s in it for us?'" says Harrison Campbell, an associate professor of geography at the University of North Carolina in Charlotte. The answer has been tricky to explain with hard data. Sure, helping others might make you feel better. But does it make you better off, too?

In at least one scenario, Campbell and colleagues Huiping Li and Steven Fernandez are beginning to prove that it does. They've found that when poverty rates and segregation are high in metropolitan areas, those regions perform economically worse relative to less segregated places. Segregated regions – by race as well as skills – have slower rates of income growth and property value appreciation. And this isn’t just true for minority families stuck in segregated pockets of inner-city poverty. It's true for everyone, the suburbs and city alike.

This research, published this spring in the journal Urban Studies, inverts the way we traditionally look at urban segregation.

"Most work that's been done in this area looks at the impact of things like segregation on those who are segregated, it looks at their employment probabilities, their wage rates," Campbell says. "The argument that we're trying to make here is that there is reason for everybody in metropolitan areas to be concerned about skills, about education, about housing, about segregation, about integration."

Broader historical trends since the 1960s show that racial segregation in American metros has been on a steady decline. But, looking at data from 1980 to 2005, this study showed that higher rates of racial segregation in a metropolitan area are associated over time with decreases in economic growth. In a place like Detroit, the most racially segregated metropolitan area in the country, this means that the entire region might generate $2 billion a year more in income if it had segregation levels closer to the national average.

"Some folks say if segregation is on the decline, then what's the problem?" Campbell says. "The problem – at least according to our results – is that even though our measures of segregation have declined over time, their impact on metropolitan areas has actually intensified."

Why might this be? And why would the segregation of poor, black families inside Detroit drag down the economic prospects of college graduates in the leafy suburbs? Campbell’s first hypothesis is that the spatial mismatch of jobs in American metros has been getting worse. As development (and employment opportunities) sprawl out geographically, people who live in segregated communities without good access to jobs are more isolated than ever. And Campbell argues that this is bad even for people who have good, high-skilled jobs, because high- and low-skilled workers complement each other.

"In my job as a professor," Campbell says, "I would be much less productive if I had to spend part of my day every day cleaning bathrooms and mopping floors."

Metropolitan economies rely on labor of all kinds, often side-by-side, with high-end architects alongside plumbers, office towers near cab stands, and biotech inventors with security guards. But when low-wage workers pay an out-sized chunk of their paycheck just getting to work, or when suburban office parks locate beyond the reach of public transit, those inefficient patterns start to affect whole regional economies.

There are also at least two more reasons why the isolation of marginalized communities and low-skilled workers might be bad for everyone. Segregation (in multiple forms) may inhibit the new ideas and innovations that arise when people who are unalike interact with each other. And, quite simply, when poor people have better access to opportunity, society as a whole has to spend fewer resources addressing poverty and its consequences.

All of this effectively means that when wealthy people decamp for the suburbs – chasing, perhaps, a better school district for their children – they may ultimately be contributing to long-term trends in segregation that harm the entire region.

"It is a very odd case, in a sense, of market failure," Campbell says. "It's a very unusual example where what seems to be good for the individual turns out not to be good for society as a whole."

So what's to be done? Campbell sketches out three solutions: the housing approach (subsidize housing so low-income people can live closer to jobs), job stimulation (in those areas where poor people already live), and transportation (better connect poor people where they already live to jobs where they already exist). The last two options don’t really change the underlying segregation. But they might increase access to opportunity. Campbell thinks the last solution – improving transportation – is the most palatable one.

"It doesn't require state or local governments to pursue economic development policies that try to direct jobs to certain places," he says. "It doesn't upset housing markets. It doesn't upset suburbanites who may not want housing that is part market-rate, part-subsidized. It just allows people to be more mobile."

But this brings us back to the original question: If people in segregated communities need better transportation out of those places and to sources of opportunity, who will pay for that? This is when transportation advocates might want to pick up a new refrain: When those people don't at least have mobility, even taxpayers who live nowhere near them are harmed.

The above map, showing the racial segregation of the Detroit region, created using a new tool from the Urban Institute.

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