Below is an excerpt from a post by Pete Carlson, president of Regional Growth Strategies, that appeared on his blog on January 7, 2016.
There are growing calls for more inclusive economic growth, and fortunately, a useful framework is starting to emerge. Championed by Living Cities and the Fund for Our Economic Future, it focuses on creating good jobs in or near low-income communities, then helping the residents of those communities prepare for and gain access to those jobs. However, creating good jobs (on which everything else depends) remains the weakest link.
In large part, that’s because economic development organizations are in a quandary about where to focus their efforts, since past attempts to create jobs for low-income residents have often come up short.
For several decades, economic developers have attempted to use income tax credits, property tax abatements, and other financial incentives to attract businesses to economically distressed areas through programs such as enterprise zones. Yet, numerous studies have found that these programs create very few new jobs for low-income residents. In fact, much of the time these programs just end up moving existing jobs from one location to another within the same region, often displacing existing employees. Moreover, it can take years, or even decades, to attract enough businesses to revitalize a blighted area using this approach, especially when competing against even more powerful incentives that promote sprawl.
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