How Economic Recovery Can Support Inclusive Outcomes in American Cities

With income inequality widening, households spending more of their income on housing, and homelessness rising, city leaders across America have been navigating economic recovery since the 2008 recession. Some cities are exploring inclusive growth, which can make cities stronger and give citizens equal opportunity to contribute to and benefit from economic success. New Urban Institute research sought to determine how economic health and inclusion interact by studying 274 of the most-populous US cities and offering a path forward with policies and practices that can support inclusive growth.

The project blended research and engagement by working with local leaders to define inclusive recovery as “when a place overcomes economic distress in a way that provides the opportunity for all residents—especially historically excluded populations—to benefit from and contribute to economic prosperity.” First, the authors (1) created indexes (economic strength index, economic inclusion index, racial inclusion index, and overall inclusion index) to understand how well residents can benefit from and contribute to their city’s economic prosperity, (2) classified the cities by giving them an economic health score, and (3) ranked the cities on the overall inclusion index to compare them with their peers. Next, the authors conducted case studies in Columbus, Ohio; Louisville, Kentucky; Lowell, Massachusetts; and Midland, Texas, to explore the strategies those cities used that enabled them to outperform their peers on all inclusion metrics during economic recovery. The authors identified eight common elements of inclusive recovery and suggest that each American city could integrate these principles into inclusive recovery plans. To find out how cities can become more inclusive and to see how your city stacks up, check out this interactive feature.

Key findings

• Economically healthy cities tend to have higher rankings on economic, racial, and overall inclusion than distressed cities.
• Small cities tend to be more inclusive across all the inclusion indexes than large cities.
• Cities that rank highly on economic inclusion do not always rank highly on racial inclusion, so it is important to monitor both.
• On average, cities that recovered from economic distress between 1980 and 2013 improved on overall inclusion. Among recovered cities, racial inclusion tended to improve more than economic inclusion.
• To recover from economic distress more inclusively, communities should adopt housing policies that create affordable, high-quality, and well-located housing. In Columbus, Ohio, and Midland, Texas, communities engaged in cross-sector collaborations with affordable housing providers.