As if U.S. Census data released last month wasn’t bad enough news for the middle class, a new study by Cornell and Stanford researchers has found that, over the last 40 years, families have become increasingly segregated in where they live in relation to their income.
Using U.S. Census data from 1970-2000 and American Community Survey data from 2005-2011, Cornell’s Kendra Bischoff and Stanford’s Sean F. Reardon found that more people are living in extremely high income areas or low income areas, while fewer are living in areas characterised as middle-income.
In 1970, 65 per cent of families lived in middle-income neighborhoods; by 2009, only 42 per cent of families lived in such neighborhoods.
While the study stopped short of offering reasons why the income segregation has progressed so rapidly, it notes that “changes in unemployment and manufacturing jobs are inversely related to income segregation.”
As you can see in the chart below, there has been a steady decline of families living in middle income neighborhoods and a corresponding increase in those living in neighborhoods at the extremes:
While income segregation has been bad for all races, it has been particularly pronounced in Hispanic and Black families:
What the study found is alarming because income segregation was found to have a vicious-cycle effect. The higher income areas give economic advantages to the high-income families while the lower income areas do the opposite for low-income families.
Here’s two ways from the study on how this works:
Suppose that poor neighbours hinder children’s educational success because children observe fewer adults in their neighbourhood with high educational attainment, and, by extension, fewer adults who have succeeded in school. Children in high-income neighborhoods observe just the opposite. In this case, income segregation would lead to educational inequality between high- and low-income children because it would produce large differences in children’s access to adult role models. …
Suppose instead that one’s neighbours do not influence school success, but that it is largely determined by the resources in the school; e.g., high-skill teachers. If high-income communities attract those high-skill teachers — for instance, by paying higher salaries — then residential income segregation will lead to unequal school resources among communities, which will in turn lead to inequalities in educational success among high- and low-income children.