A decade of economic mobility gains for Charlotte

LEADING ON OPPORTUNITY

Leading on Opportunity executive director Sherri Chisholm said Charlotte's rise to 38th in the 2024 Chetty Study of economic mobility in the largest United States cities is an indication of public and private efforts to close income gaps.

A decade after a study found Charlotte was the worst big city in the United States for economic mobility, new research indicates progress.

Research conducted by Opportunity Insights, a Harvard University-based research group found Charlotte moved from 50th to 38th in the ability of children from poor families to climb the income ladder and thrive. The research, led by Raj Chetty, was published as “Changing Opportunity: Sociological Mechanisms Underlying Growing Class Gaps and Shrinking Race Gaps in Economic Mobility.”

Charlotte is third nationally on economic mobility progress, and Mecklenburg County is the only jurisdiction of its kind in the country where poor white children had no decline in economic mobility.

“Charlotte is a city that in many ways has and continues to be ahead in our approach to community progress,” Sherri Chisholm, executive director of Leading on Opportunity, an organization launched in 2017 in response to the original study, said in a statement. “We refused to accept our low ranking and made a commitment to improve lives in Charlotte.”

The follow-up study examines children born in 1992 across the United States — specifically the bottom 20% of income distribution, or about $26,000 annual household income — and compared the data to children born in 1978, who were the subject of the 2014 study.

The Changing Opportunity study shows racial gaps are closing, but class gaps are widening across the U.S. Low-income Black children are improving while their low-income white peers are doing worse or remain the same.

“These results show that growing up in thriving communities — places where adults are employed and healthy and otherwise doing well — have a tremendous effect on the next generation,” said Chetty, Opportunity Insights’ director. “The new data shows that opportunity can change and points to lessons on how to change intergenerational opportunity in a fairly rapid timeframe.”

“Progress is possible,” says Kathryn Firmin-Sellers, interim President & CEO at United Way of Greater Charlotte. “When the Chetty study was released in 2014, United Way and other leaders took bold action to address the city’s economic mobility challenges. It’s clear that through collaboration and partnership, we can make significant strides forward.”

Charlotte's success in improving economic mobility may be in part due to the prevalence of economic connectedness, or the interaction between high (above-median) income people in low (below-median) income people’s communities and the likelihood low-income people will form friendships with the high (above-median) income people with whom they interact.

Outcomes for low income White, Hispanic, Asian and Native American children have not deteriorated in Charlotte as they have in other cities.

“We are in the early innings and we have a long way to go. We need to stay the course,” says Charlotte Mayor Vi Lyles, who in 2021 launched the Mayor’s Racial Equity Initiative. “Charlotte must remain committed to this work, especially given the impact of the pandemic in recent years.”

Since publication of the 2014 study, several public-private partnerships were leveraged to affect change in Charlotte, including:

• The Mayor’s Racial Equity Initiative, which includes funding to transform Johnson C. Smith University into a top-tier, career-focused school as well as produce equitable access, opportunities, and outcomes for communities of color

• The Charlotte Executive Leadership Council’s Leaders on Loan program, a collaboration with Charlotte- Mecklenburg Schools that has placed more than 30 companies and organizations in schools through loaned executives, financial contributions, and support

• Investment in the Housing Trust Fund to $50 million, up from $15 million, with another proposed increase to $100 million

• A $60 million investment by Mecklenburg County to create universal Pre-K for all 4-year-old children

“The progress noted in the new study is reflective of the city’s collective effort to identify issues and find solutions. The business community’s commitment to increasing economic mobility is unwavering,” said Andrea Smith, president and CEO of the Charlotte Regional Business Alliance.

Chisholm said LOO has developed a partnership with Opportunity Insights because of the work in Charlotte in which access to data and expertise has been used by local nonprofits to inform their effectiveness and strategy.

“Dr. Chetty’s team produces insights,” she said. “Leading on Opportunity is the practical translation of that big data.”

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