Connectivity, whether physical, internet or economic, is the driver of inclusive growth.
To some, economic development means shiny new buildings, to some it means more jobs in the area (or filling the more than 6,500 open jobs in New Hanover County), and to some it means people moving to the region congesting the roads. But to all of us, economic development should mean improving the lives of those living in our region.
Development is more than growth; we should strive to create opportunities for residents to improve their lives. The whole point of attracting jobs is to help our neighbors support their families, find work that is meaningful or create an opportunity for their children to live better lives than their parents.
Development focuses on improvement; growth is only expansion.
The New Hanover Community Endowment is bringing financial capital to the work. Wilmington Business Development is bringing coordination and external outreach. The Wilmington Chamber of Commerce is providing support to existing businesses. The city and county are bringing physical infrastructure. But only we as a community can develop and provide the human and social capital.
Research out of Harvard’s Opportunity Insights emphasizes that human capital is more than formal education, it includes social capital as well, specifically, economic connectedness of people in the region.
Prior work, dubbed the Opportunity Atlas, identified large differences in upward mobility depending on where one grew up, especially in their formative years.
The data suggest city and county levels of geography are too large an area and that differences are apparent in terms of blocks rather than miles. New work coming out of the Opportunity Insights team suggests economic connectivity is the strongest predictor of those differences in upward mobility.
Using Facebook data (yes, the data we hate Facebook collecting) researchers are matching up patterns of friends across income groups with income mobility and finding that areas with low-income individuals who friend high-income individuals also tend to have higher income mobility than other areas.
No, correlation is not causation, but the relationship is evidence that connecting individuals in search of opportunity to previous recipients of opportunity may help spread the opportunity around.
Digging into the data for New Hanover County reveals that we are close to the national average for low-income individuals being “exposed” to high-income individuals and slightly above average in terms of those individuals’ likeliness to friend each other – but only by about 2%.
The Opportunity Insights report, recently published in the journal Nature
, states that economic connectedness is strongly associated with upward economic mobility, evidence that “it’s not what you know, but who you know.”
Economic connectedness remains a strong predictor even when factoring in racial segregation, income inequality, etc., and we should be introducing folks to each other all around our region.
Southeastern North Carolina is uniquely positioned for economic connectedness because of our geography.
Neighborhoods and homes in our region are organized around the erratic pattern of water access rather than distance to a downtown employment center along an interstate, as in most metro areas. The pattern here provides for closer proximity of high- and low-income groups than many other communities easing our task of connecting people across income levels.
Part of our economic development efforts should be thinking about how to facilitate friendships between groups through communal activities, strategic connections of neighborhoods through trails and parks, etc., much as the chamber organizes intentional collisions.
Roman philosopher Seneca said that “Luck is what happens when preparation meets opportunity.”
We’re already preparing folks, now we need to connect them.
Adam Jones is chair of the economics and finance department and an associate professor of economics at the University of North Carolina Wilmington’s Cameron School of Business.