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2	Neighborhood Economic Development - Overview
3	Evolving US and Urban Economies Baltimore, Boston, New York, Philadelphia, St Louis lost more than half of their manufacturing jobs from 1970 to 1990 Traditional working class jobs fell from 40% of the labor force in 1950 to 25% in 1999 38 million total jobs lost in the 1970s Movement of new jobs to suburbs Exodus of non-poor from mixed income neighborhoods. De-population of these areas
4	Evolving US and Urban Economies Between 1970 and 1990, number of people living in tracts in which 40%+ are below poverty line increased from 2.7 million to 5.5 million As of 1990 census, in 100 largest US cities, 1 in 7 census tracts have 40%+ poverty level individuals. Number of these tracts more than doubled from 1970 to 1990 Rise in joblessness in high poverty census tracts Female heads of households represented 62% of all households in these high poverty areas
5	Evolving US and Urban Economies Inflation-corrected earning of nonsupervisory workers fell 19% between 1973 and 1990 Proportion of year-round workers paid low wages increased by 50%, to nearly one in five full time workers, between 1979 and 1990. For young full time workers (18-24 yrs old), 43% were earning low wages in 1990. Salaries for high school only grads dropped by 22% between 1979 and 1991
6	Evolving US and Urban Economies 80% of occupations expected to have greatest growth in number of jobs required high school diploma or less - retails sales, cashiers, clerks, truck drivers, janitors and cleaning, nursing aides / orderlies / attendants, food counter workers, waiters and waitresses. Service workers increased from 30% of total jobs in 1950 to 43% today Poverty incidence for working families with children increased 33% between 1979 and 1990
7	Evolving US and Urban Economies 66% of all new jobs were created in firms with less than 20 employees. Fastest growing occupations by percent require higher levels of education The “Creative Class” has grown from 17% to about 30% of all jobs at present according to R. Florida. “The growth of the service class is in large measure a response to the demands of the Creative Economy.” R. Florida
8	Economic Development and Social Capital “By asking low-income citizens to consider the economic landscape from a social perspective, a new appreciation of market power and opportunities . . . emerges.”
9	Economic Development and Social Capital Starting Point: Social capital for economic development can be built through community organizing that conducts strategic planning, identifies community assets and liabilities, and draws on community residents to prioritize objectives Social capital can be leveraged to create personal, economic, financial, and physical assets
10	Jobs and Social Capital Failure of social networks in terms of quality and quantity of connections may explain a large part of employment problems 50% of job finding due to age, education, race, marital status - 50% may be due to social networks Some evidence that jobs expand to absorb population increase
11	Benefits of Neighborhood Social Capital Norms of behavior Legitimacy of communication Staying in school Orientation to work Avoid police record How to behave with employer Job skills When and where jobs available Person to contact Job references Behavior on job Support on job Bonding to job
12	The “Wealth of Nations” and Neighborhoods * A “new model” for neighborhood redevelopment through private, for-profit initiatives and investment based on economic self-interest, true competitive advantages, and export-oriented businesses. * Government should focus on improved environment for business
13	Porter’s Paradigm - Foundations of Development Physical location. (Activity, business centers, transportation, communications) Demand conditions. (Immense market, underserved, distinctive needs, cutting edge) Access to regional business clusters. (Presence of competitive suppliers) Human resources. (Special skills, entrepreneurship, trained “minorities”)
14	Rise of the Creative Class Creative Economy includes software, R&D, design, creative-content such as music and film. “Intellectual content” product System of technological creativity and entrepreneurship Venture capital More effective models of producing goods and services Conductive geographic milieu
15	Rise of the Creative Class Successful places are multidimensional and diverse - do not cater to a single industry or single demographic group Stimulating and full of creative interplay Places that reflect and reinforce people’s creative identities, provide access to wide range of life-style amenities
16	Rise of the Creative Class Improving the lot of the underpaid, underemployed requires tapping into their creativity, paying them appropriately, and moving them into the Creative Economy
17	Benefits of Neighborhood Social Capital Neighborhood economic development may be the outcome of social capital