“Cities should ensure that employment and entrepreneurship opportunities are available to all people, including women, young adults, immigrants, and disadvantaged populations”

We live in turbulent times, and popular discontent with the status quo is mounting. The reasons for popular frustration vary from country to country, but the common thread everywhere is a growing sense that the economy is rigged in favour of the few.

Indeed, the gains from economic growth are increasingly going to the very highest earners. In OECD countries, people in the top 10% of the income distribution earn around ten times more than people in the bottom 10% – up from seven times more nearly 30 years ago. In 2012, among the 18 OECD countries with comparable data, the top 10% accounted for 50% of total household wealth, while the bottom 40% accounted for only 3%.

We all pay a price when inequality reaches new heights. In a range of OECD countries, rising inequality knocked 6-10 percentage points off overall GDP between 1990 and 2010. When the poorest people are unable to fulfill their potential, economic growth suffers.

As policymakers and political leaders look for ways to make economic growth more inclusive, cities will play a central role in any solution.

A survey of OECD countries shows that half the total population lives in cities of more than 500,000 inhabitants, and that cities have accounted for 60% of total growth of employment and GDP since 2001.

However, this growth has not been inclusive: income inequality in cities is higher than the national average in all OECD countries surveyed, except Canada. In the United States, 95 of the 100 largest metropolitan areas added jobs and increased their economic output in the five years following the Great Recession, but only 20 experienced median-wage growth.

Economic gains in recent years have not made the typical worker better off, and as wealthy individuals have reaped the benefits of growth, poverty has become more concentrated. According to research by the Brookings Institution, the number of extremely poor neighbourhoods in the US has more than doubled since 2000.

This has far-reaching costs. Growing up in a poor neighbourhood has been shown to reduce a person’s life prospects dramatically, even when earnings remain constant. crucial role mayors play in creating economic opportunity and boosting the productive capacity of individuals and firms.

At a recent Brookings event, OECD Secretary-General Angel Gurría discussed four key areas where cities can work to reduce inequality. These ideas will be developed further at a meeting in Paris on November 21, hosted by Paris Mayor Anne Hidalgo.

First, cities should make education systems more inclusive by investing in vocational schools where people of