The recent Brookings study looking at “job growth” and “jobs near the average resident” got me thinking again about how my past two home and workplace decisions have affected my personal finances. For those not familiar with the report, it’s mostly negative news:
Between 2000 and 2012, the number of jobs within the typical commute distance for residents in a major metro area fell by 7%. Of the nation’s 96 largest metro areas, in only 29—many in the South and West, including McAllen, Texas, Bakersfield, Calif., Raleigh, N.C., and Baton Rouge, La.—did the number of jobs within a typical commute distance for the average resident increase. Each of these 29 metro areas also experienced net job gains between 2000 and 2012.
As employment suburbanized, the number of jobs near both the typical city and suburban resident fell. Suburban residents saw the number of jobs within a typical commute distance drop by 7 percent, more than twice the decline experienced by the typical city resident (3%). In all, 32.7 million city residents lived in neighborhoods with declining proximity to jobs compared to 59.4 million suburban residents.
As poor and minority residents shifted toward suburbs in the 2000s, their proximity to jobs fell more than for non-poor and white residents. The number of jobs near the typical Hispanic (-17%) and black (-14%) resident in major metro areas declined much more steeply than for white (-6%) residents, a pattern repeated for the typical poor (-17%) versus non-poor (-6%) resident.
Residents of high-poverty and majority-minority neighborhoods experienced particularly pronounced declines in job proximity. Overall, 61% of high-poverty tracts (with poverty rates above 20%) and 55% of majority-minority neighborhoods experienced declines in job proximity between 2000 and 2012. A growing number of these tracts are in suburbs, where nearby jobs for the residents of these neighborhoods dropped at a much faster pace than for the typical suburban resident (17% and 16%, respectively, versus 7%).
For local and regional leaders working to grow their economies in ways that promote opportunity and upward mobility for all residents, these findings underscore the importance of understanding how regional economic and demographic trends intersect at the local level to shape access to employment opportunities, particularly for disadvantaged populations and neighborhoods. And they point to the need for more integrated and collaborative regional strategies around economic development, housing, transportation, and workforce decisions that take job proximity into account.
Now looking at this from a personal finance perspective, I previously lived and worked in Indianapolis where my one-way commute was roughly 16 miles. For this distance, I found over time that it cost me about $5 a day to get to work.
When I moved to Cincinnati for a new job, I first lived in Covington where I paid $1 to ride the Southbank Shuttle in the morning and usually walked home. After moving to Clifton, I still found that my now driving commute of less than 3 miles came to cost around $1 per day.
So the $5 per day Indianapolis commute cost me roughly $100 per month in gas, where the $1 per day Cincinnati commute cost me only $20. Now this may not seem like a huge amount or difference, but to most people, $80 would nearly be a full day’s work. What’s not reflected in this difference is the reduced frequency and cost related to vehicle maintenance, specifically oil and tire changes. With the greatly reduced frequency of need for these two items, the monthly savings I’ve found is closer to the full $100 amount, essentially a pay raise simply for living close to work.
Employees obviously can have little impact on where an employer chooses to locate, but they do still have control over where they live and as long as I am able, 3 miles is the maximum distance I will live from work. This distance is also interesting as I’ve found it to be the maximum distance where taking the bus is a reasonable time-cost choice, a huge benefit during the recent snowy winters, and it is also a distance where my non-work trips to downtown stay at what I think is a reasonable level for places I like to visit.
EDITORIAL NOTE: This guest commentary was authored by Eric Douglas, a native of Grand Rapids, MI who currently lives in Cincinnati’s Clifton neighborhood. Eric is a member of the Congress for New Urbanism and earned a Bachelors of Science from Michigan State University. Since that time he has worked for Planning, Community Development and Public Works departments in Cincinnati, Indianapolis and Detroit.
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