Friday, September 09, 2011

Placemaking Memphis

Brain drain Pittsburgh is back in the news. This mesofact survives because data support perception. As Brookings reports and Chris Briem (Null Space) concedes, Pittsburgh's workforce is relatively uneducated. Why that is bad:

Unfavorable Education Match; Favorable Industry Composition: These metropolitan areas have a long-run structural problem related to a mismatch between worker education and occupational demand, but they have a relatively strong mix of jobs in resilient industries, which have provided ballast against what would otherwise be higher unemployment during the recession. The typical job in these metropolitan areas requires more education than what the typical worker possesses. Yet, these economies were more heavily concentrated in growing or slower-declining industries during the worst of the recession. As in all metropolitan areas, their more educated workers are more likely to be employed than their less educated workers, but the difference between the two is more severe because of the overall education gap. These metro areas may be well positioned for short-term rebound as the national economy recovers, but unemployment rates above the national average will tend to persist until they can either boost educational attainment or stimulate greater employer demand for less educated workers.
Example MSAs: Pittsburgh, Cleveland, New Orleans, Bakersfield

The demand for workers with more education exceeds the supply. This gap can (more likely than not) lead to stubbornly high unemployment. As Chris explains, Pittsburgh unemployment is relatively low. The bad news does not apply to Pittsburgh. However, there is a large education gap:

The years of education required to do the average job in a metropolitan area divided by the years of education attained by the average working-age person in that metropolitan area.

To boil it down, the rub for Pittsburgh is the educational attainment metric. Considering the entire workforce, Pittsburgh isn't too impressive compared to all metros. Then why isn't unemployment higher? Mesofactually speaking, we never get to that question. We stop at educational attainment like we do at population. In the Pittsburgh case, the Brookings model has little explanatory power.

The jobless rate in the Memphis area would have been 8.3 percent in May, rather than the actual 10.1 percent, if the undersupply of educated workers here matched the national average, estimated Jonathan Rothwell, an author of the study.

"I wouldn't say there's a brain drain, but in a lot of cities there is a long-term challenge to make quality education available more widely," Rothwell said.

The study highlights what some public-policy analysts have long realized -- education has held back the local economy.

People develop, not places. Memphis will not improve via creative placemaking or some other economic development boondoggle. While Brookings doesn't discount such approaches, I think everyone would agree that developing local human capital is important:

Developing human capital will mean redirecting young adults towards post-secondary education who might otherwise miss or avoid it. Promoting equal access to high quality education throughout childhood and adolescence is vital to achieving this goal. For older populations, greater access to on-thejob training or adult education at community colleges may be particularly important.

Developing talent takes a long time. Memphis will change as slowly as mesofacts do. Right now, there doesn't appear to be a hidden story below the not-so-great numbers. Memphis could address that without spending millions on a Creative Class makeover.

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