The rags-to-riches, Great Gatsby-esque storyline may be more reality than fiction in the Pittsburgh area, a national study suggests.
Pittsburgh is in the top tier of cities for social mobility, according to a report released this week. The survey, which incorporated earnings filings from millions of Americans to assess people's likelihood of moving between income classes, found that Pittsburghers born to parents who make just $30,000 per year typically move further up the income ladder than similar people in any of America's 50 largest commuter areas except Salt Lake City.
And on a more regional level, Pittsburgh stands out among communities in the Rust Belt for its propensity toward social mobility.
"Pittsburgh does look more like an outlier from the perspective of the general economic situation, from the types of economic shocks that have been hitting that region in the past 20 years," said Nathaniel Hendren, a Harvard economist and one of the report's four authors, who hail from Harvard and the University of California, Berkeley, and are affiliated with the National Bureau of Economic Research.
According to the study, a person born in the Pittsburgh area in 1980 or 1981 and whose parents' income was greater than just 25 percent of the United States population's earns more money on average than 45 percent of the population today. In the Salt Lake City area, that figure is 46 percent.
The report is the first to examine social mobility geographically and to compare regions throughout the United States based on their residents' abilities to shift from the income brackets into which they were born.
Its authors set out to determine the benefits of tax breaks such as the earned income tax credit, finding a strong correlation between local tax policies and intergenerational social mobility across the U.S.
But Mr. Hendren said he and the rest of his team were most surprised by the sheer extent of the geographic variation, and he said he thinks much more research should be done to explain why someone born into a poor Pittsburgh family has a greater chance of succeeding than someone born into a poor family elsewhere, such as in Atlanta. The study found that the southeastern United States contained many of the regions with the least social mobility.
Mr. Hendren said a range of factors could have contributed to Pittsburgh's strength in the way of social mobility. The city, along with many of its neighbors in the Rust Belt, was deeply affected by the financial turmoil of the 1980s, leaving greater room for children born into hard-hit families of that time to improve their social standing.
Stuart Hoffman, chief economist at PNC Financial Services Group, said the 1980s marked a critical turnover point for Western Pennsylvania, which continued its precipitous move away from manufacturing and heavy industry and toward a more service-oriented economy. The metamorphosis kept up in the early 2000s, as Pittsburgh managed to escape from the Great Recession without taking too large an economic hit.
All of these factors, along with the strong health care and higher education sectors in Pittsburgh, could have afforded locals more opportunity to succeed financially here than elsewhere, Mr. Hoffman said.
Stephen Herzenberg, executive director of the Harrisburg-based Keystone Research Center, said the study indicates Pittsburgh is poised to become a new model for widespread social mobility, with good schools, strong civic engagement and a robust middle class at its core.
"This study is an endorsement of Pittsburgh's willingness to invest in the future and its civic and communitarian traditions," Mr. Herzenberg said.
Mr. Herzenberg added that the study should give Pennsylvania residents pause as to the current direction of state policy, maintaining that efforts to cut education funding for low-income communities and "suppress civic engagement" through a new voter identification law could move the region down the mobility rankings.
"People should absolutely take pride in Pittsburgh's performance, but in these polarized times, the region can't rest on its laurels," Mr. Herzenberg said.
But Antony Davies, an associate professor of economics at Duquesne University's Palumbo Donahue School of Business, said government interference tends to restrict income mobility. He said the "welfare state" gives "incentive to the poor to remain poor and the not-yet-rich not to become rich."
Looking to each other for help rather than to the state or federal government helps promote social mobility, he added.
"Pittsburghers tend to be reliant on themselves, on their families and on their local communities," Mr. Davies said.mobilehome - region - businessnews