The Atlanta Journal-Constitution
Rich Atlanta areas pull far ahead of the rest, report says
Less-affluent locales never recovered from recessions, says report.
Since 2000, the metro Atlanta economy has suffered two recessions — one of them painfully deep — but many of the region’s less affluent communities never bounced back.
And since more prosperous areas have rebounded strongly, the gap has grown between areas of opportunity and the areas where it is lacking, according to an analysis of government data by the Economic Innovation Group.
For those at the bottom, there’s never been a recovery, said John Lettieri, EIG president.
“They are living in a fundamentally different economy than the rest of us,” he said. “Distressed communities have had a 15-year recession.”
Researchers at EIG collected yearly data from the Census Bureau in a number of categories, from poverty to education to jobs and created a “distress index” to show the economic health of an area.
Then they looked year by year for each area code – and ranked them.
In Metro Atlanta, the highest ranking ZIP code economically was 30024 in Suwanee. At the bottom was ZIP code 30315, an area mostly south of I-20 and east of I-85.
In 2000, the Suwanee ZIP’s median household income was $86,581. The Atlanta ZIP’s median household income was $20,333.
Fifteen years later, the Suwanee ZIP’s median income had risen to $101,390. The Atlanta ZIP’s median income had barely budged: it was $21,120.
Other measures echo the notion that the Atlanta ZIP has been left behind. More than 22 percent of adults in that area do not have a high school diploma. Roughly 43 percent of its residents are below the poverty line.
In the Suwanee ZIP, 4.5 percent of adults do not have a high school diploma and the poverty rate is just over 5 percent.
Inequality has been an issue for
academics and politicians since various studies have shown an increasing share of the national income going to those at the top.
Some economists say that can be a drag on growth, since it concentrates so much of the nation’s income with people who may spend lavishly, but also invest or save much of their money. In contrast, less affluent households often spend every dollar they make.
Critics have rarely suggested the data itself is wrong, but they have sometimes argued that the conclusions are flawed. After all, people can slip into a high-income bracket with one good year – or plunge deep into the lower ranks with a bad one. And then if their luck changes, they can shift up or down.
The more of that mobility there is, the more misleading the data can be – because this year’s 1 percent is not necessarily made up of the same people as last year’s 1 percent.
But with communities, wealth is more “sticky,” Lettieri said: rich areas stay rich and poor ones stay poor. Moreover, communities are clustered – most affluent communities have affluent communities for neighbors.
That means that opportunities are much greater in those areas — so it is much better to be a poor child in a rich community than in a poor one where the chances for success are limited, Lettieri said.
“Proximity to opportunity really, really matters,” he said. “It gets harder to believe in the American dream. It’s bad for people’s faith that they can make it in America.”
Benita Dodd, vice president of the conservative think tank Georgia Public Policy Foundation, said she thinks targeted economic development is important in impoverished areas. And she argued that there are ways to inspire children by showing them more options.
The report adds to the reason for charter schools, she said. “When you look at poverty at the ZIP code level and look at the schools, we get an understanding of how the kids are struggling,” she said. “Probably the schools in their area are struggling, too.”
Of the 197 ZIP codes of the expanded metro region, 30 have poverty rates of more than 25 percent, according to EIG. Thirty-two of the ZIPs have median income of less than $40,000 and seven of those are below $30,000.
The impact of the rich community-poor community gap is not just on the people, but on the future of metro Atlanta, said Wesley Tharpe, research director of the left-leaning Georgia Budget and Policy Institute.
“The economy is at its best when it is allowing full access to opportunity for as many people as possible,” he said. “Extreme inequality undermines that. You need a strong middle class with access to educational opportunities. You need for people lower down to have access to the economic ladder.”