Greater Nashville’s Moment Achieving inclusive economic growth Am Amy Liu, u, Brook ookings ings Met etropoli olita tan n Policy cy Program ram | @amy_liuw Nashville Area Chamber and Partnership 2020 Annual Celebration| September 26, 2019
A new w fram amework k for growth wth “ The goal is to put a regional economy on a trajectory of higher growth by increasing the productivity of firms and workers in a way that raises standards of living for all .” - “Remaking Economic Development,” Brookings, 2016
1 1 2 2 3 3 Economic and Why place HQ2’s Nashville’s The The demographic matters to the implications performance complexity opportunity changes within regional and what on inclusive posed by created by Greater economy leaders in the growth economic embracing Washington region should dynamics inclusion do
1 2 3 Nashville’s The The performance complexity opportunity on inclusive posed by created by growth economic embracing dynamics inclusion
Ever ery y re region on shoul uld d pur ursue sue thre ree e goals ls 1 2 3 GROWTH TH INCLUSION ION PROSPE SPERIT RITY Jobs Productiv ductivity ity Emplo ployment yment rate Output put Stan andar dard d of Living ing Median an wage Entrepreneur trepreneurship ip Avera rage ge wage Relati lative e pover erty ty rate
Nashville’s regional economy is strong but less inclusive 1 2 3 GROWTH TH INCLUS USION ION PROSPERIT OSPERITY 9 th th 35 th 35 th 11 11 th th 2007-2017 2007-2017 2007-2017 Productiv ductivity ity Emplo ployment yment rate Jobs Stan andar dard d of Living ing Median an wage Output put Avera rage ge wage Relativ lative e pover erty rate Entrepreneur trepreneurship ip Source: Brookings, “Metro Monitor,” 201 9
Nashville’s regional economy is strong but less inclusive 1 2 3 GROWTH TH Job growt wth 200 2007-20 2017 29.6% 17.2% 10.3% 7.7% Top 100 Nashville Indianapolis Austin metro areas Source: Brookings, “Metro Monitor,” 201 9
Nashville’s regional economy is strong but less inclusive 1 2 3 GROWTH TH PROSPERIT OSPERITY Output tput per capit apita Job growt wth growth wth 2007-20 200 2017 2007-20 200 2017 29.6% 17.2% 10.3% 10.4% 9.5% 7.7% 4.6% 2.9% Top 100 Nashville Indianapolis Austin Top 100 Nashville Indianapolis Austin metro areas metro areas Source: Brookings, “Metro Monitor,” 201 9
Nashville’s regional economy is strong but less inclusive 1 2 3 GROWTH TH INCLUS USION ION PROSPERIT OSPERITY Median ian earn arning ings s Output tput per capit apita Job growt wth growth wth growth wth 2007-20 200 2017 2007-20 200 2017 2007-20 200 2017 29.6% 17.2% 15.9% 10.3% 10.4% 9.5% 7.7% 4.6% 2.9% 0.0% -0.4% -0.1% Top 100 Nashville Indianapolis Austin Top 100 Nashville Indianapolis Austin metro areas metro areas Top 100 Nashville Indianapolis Austin metro areas Source: Brookings, “Metro Monitor,” 201 9
Empl mploymen yment t rates es in in Nashvi ville le have e in increa eased ed for r all races es 1 2 3 EM EMPLOYM YMENT NT Nashville metro area employment rate 100% 95% 90% Hispanic 85% 6.6% 80% White 1.7% 75% 70% Black 6.9% 65% 60% 2007 2009 2011 2013 2015 2017 Source: Brookings, “Metro Monitor,” 201 9
But the e wage ge ga gap h p has wid iden ened ed bet betwee een whit ites es and d pe peopl ple e 1 2 3 of color lor EM EMPLOYM YMENT NT MED EDIAN N EA EARNINGS NINGS Nashville metro area Nashville metro area employment rate 100% $40,000 95% White 90% 2.4% $35,000 Hispanic 85% 6.6% $30,000 Black 80% White 9.7% 1.7% 75% $25,000 Hispanic 0.4% 70% Black $20,000 6.9% 65% $15,000 60% 2007 2009 2011 2013 2015 2017 2007 2009 2011 2013 2015 2017 Source: Brookings, “Metro Monitor,” 201 9
Mea eanwhi while le, , wages es are re not not keep eeping ng pace ce with the e ri risin ing g 1 2 3 cost of li co living ing REN ENT T INCREASE CREASE MED EDIAN N EA EARNINGS NINGS Nashville metro area 22% 22% $40,000 White 2.4% $35,000 Increase in the Nashville metro area’s median gross $30,000 Black rent, 9.7% $25,000 2007-2017 Hispanic 0.4% $20,000 $15,000 2007 2009 2011 2013 2015 2017 Source: ACS 1-year estimate surveys, 2007-2017; Brookings, “Metro Monitor,” 201 9
Finally, while Nashville is emerging as a tech hub… 1 2 3 Chang nge in n share re of na natio ional nal digital ital services ices jobs bs Top 100 metros, 2015-2017 San Francisco, CA 0.5% Seattle, WA 0.4% San Jose, CA 0.3% Los Angeles, CA Austin, TX 0.2% 0.1% -0.1% Nashville, TN -0.2% -0.3% -0.4% Source: Brookings, “Tech is (still) concentrating in the Bay Area,” 2018
…the region has an opportunity to prevent the stark income 1 2 3 in inequa equalit ity y that pl plagu gue e hig igh in innovation ion cen enter ers Household usehold income me inequality uality tren ends ds Most populous U.S. cities, 2014-2016 1.7 Ratio of change between the 20 th 1.2 percentile and 95 th percentile 0.7 0.2 -0.3 -0.8 San Francisco Seattle San Jose Los Angeles Austin Nashville Source: Brookings, “City and metropolitan income inequality data reveal ups and downs through 2016,” 2018
1 2 3 Nashville’s The The performance complexity opportunity on inclusive posed by created by growth economic embracing dynamics inclusion
Digitalization italization is tra ransf nsform rming ing the e dem eman and d for r skill lls 1 2 3 Growth rates within auto industry occupations, 2002 - 2016 Computer network support specialists 30 30% 20 Software developers, 20% system specialists 10 10% 0 0 -10 -10% -20 -20% Foundry mold Drilling & boring & coremarkers machine operations Source: Brookings, “What GM’s layoffs reveal about the digitalization of the auto industry,” 2018
Automa omati tion on wil ill affec ect t les ess-educa educated ed pe peopl ple e & w & worker ers s of color lor 1 2 3 the e most t Average automation potential by education level or race, 2017 49% 47% 44% 1 in 4 40% 39% 29% jobs in the Nashville metro area are at “high risk” of automation Bachelor’s Less than a Hispanic Black Asian & Pacific White bachelor’s or higher Islander Source: Brookings, “ Automation and Artificial Intelligence ,” 201 9
A sh shrinkin rinking g share re of ne new jobs bs pay y mi middle dle-cl class ass wages es 1 2 3 Employment growth across occupations, 1980-2015 30% 25% 20% 15% 10% 5% 0% 10 20 30 40 50 60 70 80 90 100 -5% -10% Occupational percentile -15% (ranked from lowest to highest average wage) Source: David Autor , “Polanyi’s Paradox and the shape of employment growth,” 2015
Too few w jobs bs offer er worker ers s path thways ys to the e mi middle ddle cl class ss 1 2 3 Nashville metro area, 2017 55% Good jobs: • Pay family-supporting wage • Provide health insurance • Held by sub-B.A. workers 21% 10% 13% Good jobs Source: Brookings, “ Opportunity Industries ,” 201 8
Too few w jobs bs offer er worker ers s path thways ys to the e mi middle ddle cl class ss 1 2 3 Nashville metro area, 2017 55% Promising jobs: • Low-pay / no-benefits jobs • Lead to a “good job” within 10 years • Held by sub-B.A. workers 21% 10% Promising jobs 13% Good jobs Source: Brookings, “ Opportunity Industries ,” 201 8
Too few w jobs bs offer er worker ers s path thways ys to the e mi middle ddle cl class ss 1 2 3 Nashville metro area, 2017 High-skill 55% opportunity jobs: • Meet “good job” or “promising job” criteria but… • Held by workers with a B.A. or 21% High-skill opportunity jobs more 10% Promising jobs 13% Good jobs Source: Brookings, “ Opportunity Industries ,” 201 8
Too few w jobs bs offer er worker ers s path thways ys to the e mi middle ddle cl class ss 1 2 3 Nashville metro area, 2017 55% Other jobs: Other jobs • Do not satisfy at least one of the criteria for good, promising, or high-skilled opportunity jobs 21% High-skill opportunity jobs 10% Promising jobs 13% Good jobs Source: Brookings, “ Opportunity Industries ,” 201 8
Structura uctural l and d unconsc onscious ious bia ias lim imit its s some me worker ers s from om 1 2 3 ful ully ly pa partic icip ipat atin ing g in in t the e mode dern n ec econom nomy Homeownership vs rental housing Source: Brookings, “ Under US housing policies, homeowners mostly win, while renters mostly lose ,” July 201 8; Hired, “The Opportunity Index,” 2016; John R. Logan and Brian J. Stults, “The Persistence of Segregation in the Metropolis,” 2011
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