Most Unequal, More Separate: How Income Segregation Skyrocketed In U.S. Cities

Sean Reardon and Kendra Bischoff of Stanford University released a report in November 2011 entitled “More Unequal and More Separate: Growth in the Residential Segregation of Families by Income, 1970-2009.” The report details the trend of increasing segregation by income in American metropolitan areas, finding that “the share of the population in large and moderate-sized metropolitan areas who live in the poorest and most affluent neighborhoods has more than doubled since 1970, while the share of families living in middle-income neighborhoods dropped from 65 percent to 44 percent.” You can find a CPR review of their report here.

What surprised you most about the results of your study?

The most surprising result for us was the doubling, from 1970 to 2007, of the percentage of families living in poor or affluent neighborhoods.

Do you think income segregation trends will continue to increase over the next decade?

First, it is unclear how the housing crisis and recession have affected income segregation over the last few years. The most recent data available in our report were from the period 2005-2009; most of that time period is pre-housing crisis and recession. As a result, our data don’t tell us how income segregation has changed more recently. Job loss and housing foreclosures—both of which became much more prevalent since 2008—affect both family income and where people live, and so will affect income segregation. Housing foreclosures may have increased income segregation by causing low-income families to move to lower-income neighborhoods. Conversely, declining income among some middle-income families, either as a result of declining real wages or unemployment, may have led to a reduction in income segregation if those families remained in their neighborhoods but experienced a decline in income relative to their neighbors.

Second, future trends in income segregation are hard to predict from our current vantage point, though if income inequality remains as high as it is now or continues to grow, we suspect income segregation will continue to grow. To significantly reverse the ongoing trend of increasing income segregation, the United States would not only need to reduce income inequality, but it would also have to rethink housing and residential zoning policies.

In your report, you discuss the effects of income segregation on children. Can you discuss the long-term consequences you anticipate for children raised in neighborhoods with high income segregation?

The concern we have is that within metropolitan areas, as income is increasingly unequally distributed among neighborhoods and communities so too is the quality of public resources, such as schools. Schools are a focal point because education is important for upward mobility, and schools are also where children spend a great deal of their time. Thus, equality of educational opportunity is important both for equality of outcomes as well as for children’s quality of life. In addition to the actual access to resources, such as schools, green space, and clean air, we are also concerned that the increasing separation of affluent and poor families leads to less interaction between people of different social classes. This could lead to more polarization of political beliefs, as well as less support among the affluent for equality-generating social policies.

What do these trends in income segregation bode for the future of American cities? In what major ways will cities change if income segregation continues to increase?

We have already witnessed changes in American metropolitan areas as a result of the large increases in income segregation over the past 40 years. Our research focuses on metropolitan areas, which are generally considered to be proxies for labor markets and consist of a central city and its surrounding suburbs. Within metropolitan areas we have observed increasing macro-segregation, or large-scale separation of wealthy families from families of all other income levels. Metropolitan areas like Philadelphia and Detroit have experienced a hollowing out of their inner cities and a growth in high income enclaves in suburban and exurban communities.

However, there have also been changes in micro-segregation within inner cities, meaning that there are more pockets of poverty and wealth within central cities. Of course this has always been true to some extent, but it is becoming more prevalent which means that fewer families are living in mixed-income neighborhoods.

What, if anything, can cities do to combat the effects of income inequality?

There are many possible effects of income inequality, including health disparities, crime, education gaps, political polarization, as well as income segregation. Thus, there are policies that can act to reduce income inequality itself, and there are policies that try to reduce the harm done by income inequality. Given the limits of sub-state government, there is little that cities can do to change the overall income distribution. Metropolitan areas, which consist of multiple municipalities and other political jurisdictions, can however, implement revenue-sharing plans that help to equalize the tax base across their jurisdictions, thereby increasing regional equality. A select few metropolitan areas have implemented this type of plan, such as Minneapolis-St, Paul, MN.

In terms of combating income segregation, one of the effects of income inequality, cities can alter housing policies, zoning restrictions, and other laws that have consequences for where people live. Cities might also combat the negative effects of income segregation by changing school assignment policies to better integrate schools by race and class, for example, or by providing more amenities, such as well-kept public parks, in disadvantaged areas.

What, if anything, can the federal government do to combat the effects of income inequality?

Income inequality is now at historically high levels in the US, and is higher in the US than in most other developed countries. One way to combat the negative effects of such income inequality would be to work to reduce inequality by supporting industries that create well-paying jobs, by modifying the tax code, by raising the minimum wage, and by strengthening the social safety net to support families through the hard times between jobs and when workers are sick or disabled.

Another way to combat the effects of income inequality is to strengthen social policies that promote social and economic mobility, so that those who grow up poor have a greater opportunity to achieve middle-class success. Policies that increase the availability of high-quality child care and pre-school for low-income families, for example, may lead to greater social mobility (less intergeneration reproduction of inequality) by providing children from low-income families with greater opportunities for educational and economic success.

A third way to combat the effects of income inequality is to revise campaign finance law so that economic resources do not play such a large role in elections. A more balanced democratic process—one where the wealth of one’s constituents did not play such a large role in elections—might yield policy changes that lead to greater equality of opportunity and a fairer, more democratic society.

Feature photo:  cc/ydhsu