Growing Cities that Work for All: A Capability-Based Approach to Regional Economic Competitiveness

The United States has posted more than 100 consecutive months of net job gains since the economic recovery began in 2010, making this the longest expansion in seven decades. Yet, for many, wage growth has lagged, leaving many families economically insecure. Meanwhile, job and economic growth continue to accrue in select corners of the nation, leading to disparate economic and social outcomes across the country. This uneven progress reflects, in part, a nation grappling with an accelerating pace of change. Powerful new technologies have enhanced people’s and firms’ ability to achieve unprecedented productivity and have made the global economy more interconnected than ever. At the same time, these forces are making some skills and knowledge obsolete. As demand for specific knowledge and skills rises, the people and places that can meet these demands thrive, while others lose ground. Communities throughout the United States must find new solutions that address rapid transformation of industries and the labor force. Systems and institutions that helped foster inclusive economic growth and prosperity in the past century, like higher education, workforce development, and social policy, have struggled to adapt to today’s circumstances. Work-based benefit and safety net programs are ill-equipped for a labor market in which people will have many careers, and where work is increasingly organized around short-term assignments rather than traditional jobs. Worker retraining and adjustment programs are often not linked to employment opportunities. Economic development plans often involve tax incentives for industries that may not be strategic. To pay for such incentives, metro or regional officials must often draw from funds that could otherwise be spent on public goods. Meanwhile, top-down federal programs are unable to respond to communities’ unique challenges and opportunities.

Source: Brookings

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Author: 
Brookings

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