States Offer Very Different Chances for Economic Advancement

The 2013 Opportunity Index tries to determine which states and counties offer the best chances for their residents to get ahead.
by | November 5, 2013 AT 8:30 PM
Social mobility: in some parts of the country it's more more likely to happen than others. flickr user openDemocracy

What does an unemployment rate tell you about your chances of making more money than your parents? Not nearly enough, argue the authors of a burgeoning index aimed at measuring the opportunity for economic advancement in states and counties.

Opportunity Nation, a non-profit organization based in Boston, launched what its director terms “the nation’s first statistical measure of the American dream” two years ago to better judge how states and localities are establishing a climate that allows people to end up better than they started out. The Opportunity Index, newly updated for 2013, is a challenge to conventional thinking about improving economic outlook through the more narrow focus of tax policy and business incentives. The problem, according to Opportunity Nation, is that other rankings measure business in a state, but they don't say what that means for the people living there.

The Opportunity Index includes statistics such as unemployment and median wages, but also among its 16 categories are measures of poverty, inequality, affordable housing, preschool enrollment, high school graduation rates, membership in civic organizations and access to healthy food. Overall scores weigh all those factors together. The clearest indicators of how well a state or county performs? Poverty and a factor called disconnected youth, which measures the number of young adults between the ages of 16 and 24 who are either jobless or out of school. That number was 5.8 million at the national level.

It isn’t news on the policy front that U.S. social mobility isn't as fluid as it was in the decades following World War II. A 2006 study from Sweden found that 42 percent of American men who grow up in the bottom fifth of income remain in that group as adults. That’s only true for 25 percent of men in Denmark and 30 percent in Britain. More recently the Pew Charitable Trusts has found 65 percent of all Americans born in the bottom fifth of incomes stay in the bottom 40 percent in adulthood.

In the 2013 list Vermont took the top ranking while Nevada came in last. Vermont, which finished first in 2012 as well, stayed competitive with high economic and education indicators, but the state stood out most on community measures such as low youth disconnection, low crime and access to primary health care. Despite fairly average income and poverty rates, Nevada brought up the rear because of its 9.5-percent unemployment rate, its low rate of preschool enrollment, its poor on-time high school graduation rate and low community engagement. Nevada ranked the lowest of all states in those measures.

Top-ranking states typically had the highest community life scores of any states, and in fact those often outpaced their economic and education standings. That's true of second-ranked Minnesota, fifth-ranked Nebraska and sixth-ranked Iowa. The poorest-ranking states scored the worst in education, which, in addition to preschool enrollment includes on-time high school graduation rates and the percentage of the population that holds at least an associate's degree.

The District of Columbia, counted as a state in the rankings, managed to outshine all others in growth. The area still ranks the highest in income inequality, but it was the only state to lower that rate in the past three years. The District also made sizable gains in preschool enrollment and the percentage of its population that holds an associate degree or higher. The District, however, saw a decrease in its community life--a factor Opportunity Nation considers overlooked.

Youth with strong civic ties are more likely to make job connections through their involvement, often with the help of mentors, said Mark Edwards, Opportunity Nation’s executive director, at an unveiling of 2013’s rankings in Washington, D.C.

“We believe this is a much more nuanced and powerful way of thinking about opportunity,” Edwards said. “We have to go beyond GDP and unemployment.”

Most striking about communities with the highest youth disconnect was how little it’s changed in ten years, suggesting a cycle that feeds itself, said Sarah Burd-Sharps, co-director of Measure of America, one of Opportunity Nation’s partners.

“There hasn’t been any effective action in these communities in over a decade,” she said.

Absent in many places are youth development programs either through schools or nonprofits that connect kids with mentors, training and private employers, said Harry Holzer, a professor of public policy at Georgetown University. Some that have seen real success, according to Holzer, include the national Year Up organization; Washington state’s I-Best program, which combines basic academic skills with technical know-how for students in community colleges who come with serious gaps; and LaGaurdia Community College’s GED bridge program. But more should be done to create academies within K-12 education that focus on specific industries and connect students to opportunities within those fields through local partnerships with private employers, he said.

“These are the success stories that we know about, but you look at so many of our schools and they’re not like that,” Holzer said. “They’re silos.”

For more detailed rankings by county and state, see here