Summary of From Great Recession to Great Reshuffling

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7 Innovation

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Since the Great Recession, much attention has focused on the widening financial disparities evident across the United States. Indeed, many geographic areas have experienced roaring comebacks, while others have suffered greater economic pain. The Economic Innovation Group pinpoints the nature and extent of those gaps in this robust and accessible analysis of American communities by postal code. Though much of what the study finds may not be new, it bolsters the idea that the diverging fortunes of US neighborhoods threaten the future of the overall economy.

In this summary, you will learn

  • What drives the relative prosperity of communities in the United States,
  • Why some areas have flourished while others have lagged, and 
  • How educational attainment differentiates local economies. 
 

About the Author

The Economic Innovation Group is a think tank and advocate for entrepreneurialism.

 

Summary

The 2008 financial crisis brought seismic upheavals to US politics and society, and the Great Recession that followed upended the economy. The subsequent recovery reshaped the composition and prosperity of American communities, according to the Distressed Communities Index (DCI). Based on US Census Bureau household surveys, the DCI measures “the vitality and well-being” of localities across the country during the recovery. It gives equal weight to seven indicators: educational attainment, housing vacancies, unemployment rates, poverty rates, the ratio of an area’s local median income to the state’s, the rate of change in the number of available jobs, and the rise and fall in the number of businesses. Aggregations of postal zip-code results into quintiles denote five levels of economic success, from “prosperous,” “comfortable” and “mid-tier” to “at risk” and “distressed.”


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