Economic Mobility Depends on Location

Is the United States of America still the land of opportunity or is it becoming more difficult for people at the bottom to live the dream? The answer depends on where you live πŸ˜‰

Upward mobility measures the likelihood for people to move up their economic status.Β A recent study published by the Equality of Opportunity Project shows that some US locations have adequate upward mobility compared to other countries. However, other parts of the US have lower levels of economic mobility than any developed country based on current data.

The researchers looked at how many children from families in the bottom 20 percentile of the income distribution ended up rising to the top 20 percentile. They discovered that where you live can make a difference on your upward mobility.


Cities like San Fransisco, CA show high levels of income mobility at 11.2% πŸ˜€ But the chances of going from lower working class to upper middle class in other places like Detroit, MI is only 5.1% πŸ˜•

Part of the reason for the difference in numbers across the country is because different locations have larger tax credits for low and mid income families. Also, segregated communities of extreme rich and poor neighborhoods make it more difficult for the poor to climb the income ladder. The study also notes that two parent families, Β more neighborhood cohesiveness, Β more mixed income neighborhoods, more civic engagement, and a better education system are all positively correlated to upward mobility πŸ˜€ For a complete list of US cities and their odds of reaching the top fifth starting from the bottom fifth, you can check out the website of the study.

So what can we learn from this study? ❗ If you are looking to move to a new city but not sure where yet, consider a place with a high level of upward mobility, especially if you have kids. Some states like Maine appear to have a lot of opportunity because the median household income there is one of the highest in the country. But if you’re making near minimum wage, it’s probably better for you to move to North Dakota where the chance for relatively poor people to become successful is over 30% in some cities, whereas in Maine, all the areas are under 10%. If you can increase your chances to become rich by 3 times, hey why not? πŸ˜† Becoming financially independent is all about strategy. You have to find the right plan for your own situation πŸ™‚

Random Useless Fact:Β This is how ice cream sandwiches are made (animated gif)Β Β πŸ˜€

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Romona (@monasez)
Romona (@monasez)
08/17/2013 7:39 am

I definitely agree people can achieve financial stability by making a clear plan. But unfortunately, people who live in poor economic conditions let their situations get the best of them and fail to gain economic mobility.

DC @ Young Adult Money
08/19/2013 4:55 am

I’m a stats geek so I definitely appreciate this graph. While I’m not sure I would NOT move to a place because of economic mobility alone, it’s definitely something to consider.

08/19/2013 7:21 am

Sadly I’m not actually surprised to see which areas are the hardest to move up the income ladder. What did surprise me however, was that it only took a household income of $70k by 30 years of age to achieve top quintile status.

Jordann @ My Alternate Life
08/20/2013 3:41 am

Unfortunately those stats make a lot of sense to me, it’s unfortunate that there are some areas of the country that are less conducive to upward mobility! I wonder if moving really would increase your chances, or if it’s mostly up to the individual.

myownadvisor (@myownadvisor)
08/20/2013 3:11 pm

Cool and interesting graphic. Will include in my Weekend Reading roundup.