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What Works
What the signs are telling us.....
All the key indicators of regional vitality are lagging when it comes to the economy. In addition to having the highest poverty rate among key Pennsylvania cities, Erie has a higher unemployment rate than we find in the state and nation as a whole. Even though there has been growth in the tourism and health care industries in the past decade, we are reminded that many of the jobs in these two “growth” sectors have been in low wage food service, hospitality, and home health care jobs that do not support families.
Some of the other key indicators in the Vital Signs dashboard have their roots in this economic arena, notably the areas of Brain Gain and the retention of highly skilled workers here, K-12 Education and the correlation of poor educational outcomes with poverty, and Cultural Vitality with its focus on the creative economy. Accordingly, the strategies for economic growth dovetail with those found in other the other indicators, yet also carve out a place of their own in specific anti-poverty initiatives.
What Works: Traffic Patterns, Promising Practices, and Pilots
From a national scan of programs led by nonprofits that are making a difference in other communities, we see hope in:
Neighborhood Stability
In addition to the strategies outlined in the Brain Gain and K-12 Education sections where strategies that cultivate a climate of academic success and strong engagement in learning, entrepreneur-friendly business environments, and steps toward the enhancement of the creative economy are outlined, there is much to be said for the strategy of promoting neighborhood stability as a poverty-reduction tool. One of the lesser known but most insidious factors that works to undermine educational continuity and success for low-income students is the amount of lateral housing mobility they experience. In many urban areas, it is not uncommon for students to move several times a year, often from one substandard rental to the next, and usually changing schools in the process, particularly at the elementary level where lack of continuity does the most long-term damage to educational prospects.
Communities with strong housing counseling programs, tenant advocacy services, and neighborhood organizations that offer support and problem-solving to residents so that lateral moves become the exception rather than the rule are needed, because family stability builds more neighborhood social capital and is a key ingredient in school stability which leads to academic success. See:
ESAC (Boston)
St. Martin Center (Erie)
Financial Capability
Beyond financial literacy lies the dimension of financial capability, suggesting that thoughtful, responsible financial behaviors on the part of individuals and families lie beyond the realm of knowledge alone and in the realm of action – the economic behaviors that people actually practice. Developing banking relationships, planning and practicing a long-term financial orientation with goals and benchmarks, and avoiding all predatory lending are the types of progressive financial behaviors that are suggested by the development of financial capabilities within individuals and families. For more information, see:
Financial Social Work programs
Living Wage Campaigns
Over 120 municipalities nationally have embarked on campaigns for living wages, and many have passed ordinances that require vendors and contractors that do business with the city or county to have a living wage provision whereby they pay employees a wage that is indexed to an above-poverty standard, normally between $10 and $12 per hour. A study of living wage ordinances nationally shows that:
• Actual cost increases as a result of the ordinance to municipalities is less than 1%.
• Contract costs increase less than the rate of inflation.
• The provisions benefit families with few or no negative effects.
• Employers report increased productivity and decreased turnover.
For more, see www.epi.org/publications/entry/bp170
Tax Policy
There is probably no more powerful a force to spur the economy and boost wealth at the bottom of the income scale than tax policy. This will involve a sweeping debate in the coming months and years, but key among the options some economists put forward to consider are:
• Extending the successful Earned Income Tax Credit to higher earning levels
• Exempting the first $20,000 from payroll taxes.
More discussion of tax policy options for America can be found at:
Philanthropic On-Ramps
Modest, strategic investments of grant funds that can help move strategies for The Economy into the fast lane include:
As stated throughout, the on-ramps related to K-12 Education and Brain Gain, focused as they are around student engagement, educational achievement, and creating the climate that keeps talent and entrepreneurial energy in the community are all solid anti-poverty strategies that have a place on this dashboard that tracks economic indicators.
In addition, the following initiatives drawn from the scan of promising programs and pilots can serve as promising on-ramps as well:
• Neighborhood stability initiatives involving community organizing, housing counseling, tenant advocacy, and moving renters into responsible home ownership.
• Enhancing the financial capability of low- and moderate income individuals and families through evidence-based programming that builds responsible financial behavior and asset accumulation.
• Policy-focused education and advocacy work focused on promoting the payment of living wages and the adoption of fair and progressive tax policy.