The relationship between education and income has grown increasingly apparent in recent years. According to the Social Security Administration, the median lifetime earnings for men with a bachelor’s degree is $900,000 more than the median income for men with a high school diploma. Among women, the difference is $630,000.
This connection is apparent in the neighborhoods with high concentrated poverty rates. The national bachelor’s attainment rate in neighborhoods with concentrated poverty is 11.6%, compared to the 30.8% attainment rate in all other neighborhoods.
Joblessness also tends to be a bigger problem in extremely poor neighborhoods than in those with lower poverty rates. Unemployment is higher in the poorest neighborhoods than it is in the remaining parts of the city in all but two metro areas on this list. In neighborhoods without concentrated poverty, the average annual unemployment rate is 7.2%. In concentrated poverty neighborhoods, unemployment averages 16.4%.
Declining job availability may partially explain the upticks in concentrated poverty. In the majority of metro areas on this list for which comparable data is available, unemployment in the poorest neighborhoods climbed between 2010 and 2016.
Both declining job availability and upticks in extreme poverty rates are often partially the result of weak economic growth. Eleven cities on this list reported negative average annual GDP growth between 2010 and 2016, even as the U.S. economy grew at an average rate of 2.0% over the same period.
Not all states are home to a metro area with upticks in concentrated poverty. Metro areas in Hawaii, New Hampshire, North Dakota, Rhode Island, South Dakota and Vermont reported declining rates of extreme poverty from 2010 to 2016.
Meanwhile, Alaska, Delaware, and Wyoming had no metro areas with extreme poverty neighborhoods in either 2010 or 2016.
To identify the metropolitan areas where poverty is concentrating the fastest in each state, 24/7 Wall St. reviewed U.S. Census Bureau American Community Survey data on poverty rates at the tract level. We list for each state the metro area with the largest percentage point increase in residents living in extreme poverty. The concentrated poverty rate is the share of a metropolitan area’s poor population that lives in a census tract characterized by extreme poverty — having a poverty rate of 40% or higher. The concentrated poverty rate was reviewed for 2010 — represented as a five-year average for 2006-2010, and 2016 — a five-year average for 2012-2016. Census tracts in which more than 50% of the population is enrolled in postsecondary school or where the total population is fewer than 500 were excluded from consideration of extreme poverty. We also reviewed other data from the American Community Survey, including educational attainment rates and unemployment rates for both groups in concentrated poverty and those not in poverty. These data are also averages of the 2006-2010 and 2012-2016 five-year periods. Average annual GDP growth came from the Bureau Economic Analysis.