Challenges to Advancing Economic Mobility

Challenges 

Every municipality has its own challenges to overcome in its efforts to advance the economic mobility of residents. There are, however, some key areas that, if addressed, could help accelerate other investments and start breaking down barriers for more residents to begin economic mobility upward. 

Key Areas for Local Leaders

Lack of Good Jobs for Residents 

For cities seeking to advance upward economic mobility through employment, local leaders are encouraged to understand the difference between settling for “just a job” versus promoting “good jobs” for residents. Good jobs generally have family-supporting wages, benefits and opportunities for advancement. Moving from no job to any job can be an important first step, but the long-term placement of individuals in industries or with employers who support the development of their staff is essential to ensuring that residents can advance into careers that allow them to build wealth. For communities nationwide, individuals who receive this investment will provide more long-term economic benefit as higher wages lead to more spending, more stable budgets, and less utilization of public benefits and services. For historically underrepresented communities, the return on investment for high-quality jobs and careers can be even greater. 

When a city does not have a sufficient number of good jobs available to residents, the social fabric of its communities can be unraveled. Without jobs that pay living wages¹, workers cannot afford to frequent local businesses, which can then spiral and prohibit small businesses from earning enough profit to expand their workforce. When there are fewer good jobs, there is also less competition among employers, which can have the effect of decreasing salaries, wages and benefits that are offered within a community. This decrease in pay can have a long-term impact on the ability of residents to save for their retirement, a home or their children’s education, thereby increasing the likelihood of intergenerational poverty. This effect can decrease the economic health of cities because of the direct tie between the economic health of residents and municipal budgets. Finding solutions that advance the economic mobility of all residents, from youth to caregivers and returning citizens, offers municipal leaders an opportunity to meet the needs of their communities while strengthening their municipal budgets. 

Cities have numerous options to create good jobs for residents that leverage the strengths of the community – employers that invest in training, workforce investment boards (WIBs)² that work with service providers to ensure wraparound supports for participants or businesses that are responding to their employees’ needs. 

Municipal Workforce Recruitment and Retention 

Municipal staff are the most critical resource any municipality can have, but sadly, there are increasingly staff shortages that limit the services available or the development of new programs to fill important community needs. Additionally, understaffed departments can affect wages and benefits offered due to overtime expenses or service cuts, leading to staff burnout or faster staff turnover.  

Municipalities need to work with their residents to ensure that key staff roles are filled to ensure continuity of services. This collaboration can include municipal workforce development, specialized job training, and engagement with key audiences such as youth and returning citizens.  

By employing residents, municipalities can provide both a job and a pathway to upward economic mobility through the benefits and opportunities offered to the worker. Cities must review their benefits structure often to ensure that they are attracting new talent and meeting the needs of existing employees. To stay competitive as an employer, they also should maintain awareness of private and nonprofit sector benefit trends that could push talent to leave municipal service. 

Like any employer, municipal governments must find a balance between the benefits that they can offer their employees and the cost of those benefits. They can be creative in the benefit packages that help them attract and retain talent and increase the economic mobility of their staff. These benefits can include enhanced paid family leave,  childcare access and more. In addition, many cities are starting to remove degree or training requirements for some public sector jobs. They can share their strategies with other employers in their community to strengthen the supports other workers receive, thereby enhancing the upward economic mobility of the broader workforce. 

Cities in Action

1. Cities in Action: Miami Summer Youth Employment 
2. Cities in Action: Austin Affordable Small Dollar Loans