U.S. economic growth is limited to a handful of high-growth cities and towns wile masking the declines in rusting former factory towns, parts of the rural South and other areas, a study cited by The Wall Street Journal said.
“The prime years of the national economic recovery bypassed many of America’s most vulnerable places altogether,“ the Economic Innovation Group said in a report. ”Far from achieving even anemic growth from 2011 to 2015, distressed communities instead experienced what amounts to a deep ongoing recession.”
The unemployment rate is near a 16-year low and the economy has added more than 16 million jobs in the past seven years. But those numbers don’t reveal the major divisions between the have’s and have-not’s, according to EIG, a Washington policy group that was established in 2015.
Its report shows how wealth and poverty are reflected in educational attainment, housing vacancy rates, labor-force participation, poverty rates, incomes, job creation and business creation for each ZIP Code in the U.S.
About 85 million Americans, or more than a quarter of the population, live within the most prosperous communities in the Western half of the country and often tech hubs. Gilbert and Chandler, Arizona, both Phoenix suburbs; Plano, Texas; Irvine, California; San Francisco and Seattle are among the haves.
The bottom 60 percent of ZIP Codes, where about 168 million people live, created one of every four new jobs during the same period. Cleveland; Newark, New Jersey; Buffalo; Albany, Georgia and Memphis, Tennessee are on the list of have-nots. Youngstown, Ohio, is severely distressed.
In the most economically depressed areas, about 23 people of the people don’t have a high school diploma, more than a quarter of the population lives in poverty and more than 40 percent of adults ages 25-64 are neither working nor looking for work, the WSJ said.
EIG recommends educational reforms, such as training more people for trades to encourage them to finish high school.
The uneven growth was also seen in personal income, the Pew Charitable Trusts said in a November report. Income varied from a constant annual rate of less than 1 percent in Nevada to almost 5 percent in North Dakota since the start of the Great Recession. Weakness in energy and agricultural earnings trimmed gains for six states for the year ending in the second quarter of 2016.
Nationwide, growth in personal income was slower than in past recoveries. Since the downturn began in the fourth quarter of 2007, estimated U.S. personal income rose by the equivalent of 1.7 percent a year through the second quarter of 2016, compared with the equivalent of 2.8 percent a year in the past 30 years after accounting for inflation, Pew said.
States have recovered at different paces. In 2015, Nevada was the final state to recover its personal-income losses and return to its pre-recession level. Since the end of 2007, personal income in 18 states has grown faster than in the nation as a whole, after adjusting for inflation.
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