Improving Opportunities and Boosting Economic Mobility

Advancing Economic Mobility in Your Community

Economic mobility is often described as how a person’s economic well-being changes over a lifetime. As a person’s income increases, they are considered upwardly mobile. Economic mobility is influenced by an individual’s community, neighborhood, geographic area and population group.

Economic mobility is viewed by the National League of Cities (NLC) as a continuum – starting with economic stability (ability to meet basic needs), progressing to economic security (stable employment and ability to cover expenses) and ultimately to wealth building (ability to save for self and family’s future).

Cities have the power and authority to influence and impact upward economic mobility through their day-to-day operations. This includes reviewing and changing internal policies to address inequities, creating programs that target community needs and build long-term financial strength and directing general budget spending that supports the advancement of upward mobility, especially for Black, Indigenous and people of color (BIPOC) communities.

Why addressing inequities in economic mobility in your city is essential

Advancing the upward economic mobility of city residents has a direct impact on the financial health and long-term viability of municipalities. Research has found that economically secure families with as little as $250 in savings are better able to weather the ebbs and flows of income drops and unexpected expenses. They are also less likely to rely on local services for housing support and cash assistance. Additionally, financially healthy adults and families are less likely to be evicted, miss a housing or utility payment or receive public benefits. This matters to cities because economically secure individuals are more likely to provide revenue via sales, property ownership or income taxes that can provide more predictable municipal budgets.

Research has also shown that the economic mobility of individuals in the United States is lower than in other wealthy countries. Moreover, even removing factors such as education levels, the ability of a child to achieve upward economic mobility is impacted by the neighborhood where they live. Intergenerational economic mobility varies considerably throughout the U.S., with significant racial and gender differences.

When municipalities work to increase upward mobility, it can lead to benefits for residents and for cities. Residents can achieve increased income, educational attainment, better access to physical and mental health resources, a higher quality of life and the ability to pass on wealth to future generations. Cities benefit from increased revenue, greater public safety and stronger local economies.

Local governments are well-positioned to effect change

All cities, regardless of size, have important roles to play in boosting the economic mobility of residents. Within these varied roles, there are promising policy and programmatic levers that are unique to municipalities and have the potential to move the needle on helping residents become more economically secure. Through interviews, focus groups and other connections with city leaders and staff, NLC has identified the following roles and policy and programmatic levers that are effective for cities.

City Role

Municipal Lever

Listener

• Reach and engage through city communication vehicles
• Use the power of city hall to convene residents and stakeholders

Implementer

• Create and fund new programs to meet local needs

Community Partner

• Call upon community organizations to spread city messages and gather information
• Foster community-wide collaboration to streamline services

Model Employer

• Improve wage and benefits packages for city employees
• Embrace inclusive recruitment and hiring practices

Funder

• Make grants to community organizations and neighborhoods
• Promote economic mobility through procurement

Priority Setter

• Incorporate economic mobility into strategic plans

Equity Leader

• Pass ordinances to ensure equity
• Restructure local government to prioritize racial equity

Addressing one of the largest challenges of our time

Cities across the country are rising to the occasion to address the decline in economic mobility for low-income youth, families and BIPOC communities. Federal recovery packages, such as the American Rescue Plan Act (ARPA) and the Bipartisan Infrastructure Law (BIL), have provided many municipalities with a chance to develop and amplify supports residents need to build wealth. These investments can be focused on improving residents’ economic mobility by leveraging their short-term funding to address long-term inequities through the alignment of community partners that sustainably change the trajectory for underinvested communities.

The resources found here are meant to help local leaders advance upward economic mobility in their communities and to enable all residents to participate in a strong local economy, now and in the future.

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