Archetypes of Urban Prosperity
Insights

In general, the urban counties of America are more prosperous than their rural counterparts. However, not only do urban areas vary in the magnitude of prosperity, but also in the composition of their prosperity. Across the eight states profiled in the Index, three distinct urban archetypes emerge. The most prosperous is the metropolitan core, comprising New York City (although not the Bronx), Denver, Dallas, the Bay Area, and Southern California. Slightly less prosperous is a collection of large southern cities such as Atlanta, Houston, and Austin. The third and least prosperous of our urban archetypes includes smaller cities in Georgia as well as the Bronx in New York.

Archetypes of urban prosperity 1

COMMON CHARACTERISTICS OF URBAN ARCHETYPES

Each of these city groupings tends to be much more ethnically mixed than the average across all counties, with a high share of working-age residents and a commensurately low share of seniors. Additionally, there tends to be a low share of government workers — especially in larger cities — and a greater share of employment in knowledge industries, retail, and services.

All three types of urban county have good economic infrastructure (finance, communication, transport), and their populations exhibit high levels of social tolerance and good mental health. On the other hand, social capital is weak, crime rates are high, as is air pollution. For many cities, ensuring adequate and affordable housing is an ongoing challenge.

METROPOLITAN CORE

Archetypes of urban prosperity 2
Archetypes of urban prosperity 3

Counties in the metropolitan core, such as New York City, Dallas, and Denver, as well as much of southern California, possess many institutional, economic, and social advantages. Overall, residents of these areas are the healthiest of those states reviewed — both physically and mentally — and have low mortality rates in each stage of life. There are also particularly high levels of social tolerance; the number of hate groups that are based in these areas is much lower than average.

In terms of education, the metropolitan core demonstrates a mixed performance. They attract talent from all around the world and have particularly strong tertiary education outcomes, but primary and secondary education outcomes are poor. Improving these levels of education would develop the talent of local children. Studies have shown that improved education outcomes can also result in reducing crime rates — high levels of which are found in many of the cities.

Encompassing some of the largest metropolitan hubs in the world, these counties deliver some of the highest productivity levels in the country, as well as high levels of entrepreneurship, which are underpinned by strong financing ecosystems. For example, New York City is the nation’s financial hub, the Bay Area alone accounts for nearly half of all venture capital investment in the country and the investment scenes in Dallas and Denver are burgeoning. These metropolitan cores are also poised to facilitate future business growth with reliable electricity supplies and the requisite telecommunications infrastructure.

Despite these advantages, counties in the metropolitan core tend to have an inflexible labor market and high rates of both taxes and subsidies. Housing is also a major challenge for these cities, with some of the highest levels of overcrowding, homelessness, and unaffordable housing across the eight states profiled.

LARGE SOUTHERN CITIES

Archetypes of urban prosperity 4
Archetypes of urban prosperity 5

Further to the south is another metropolitan archetype that comprises cities including Atlanta, Austin, Houston, and El Paso. In contrast to the metropolitan core, these counties have more business-friendly regulations and are more goods-oriented as opposed to service-oriented — though their service industries are still stronger than average. These cities have a high share of retail workers, and low share of government workers. They also have a particularly high share of families with children.

Much like the metropolitan core, these cities generally have good communications and transport infrastructure, which helps to facilitate business establishment and expansion. This strength underpins a business environment that is conducive to competition and a labor market that is flexible, allowing employers to do what is best for their businesses. Typically set at the state level, occupational licensing regulations play a large part: in large southern cities, 37 low-income occupations require licenses on average, compared to 67 in the metropolitan core counties. The confluence of these factors resulted in high levels of productivity and economic dynamism, as well as low rates of unemployment as 2020 began.

Further bolstering the economic credentials of the large southern cities is a flourishing financial scene, a prime example of which is Atlanta. It is the economic hub of Georgia, generating 65% of the state’s GDP, and has exhibited economic growth at more than twice the rate of the rest of the state since 2012. In 2019, the Atlanta metro area attracted $1.8 billion investment from venture capital firms — an 86% increase since 2018. Similarly in Texas, San Antonio has benefited from its innovation zone, which has been designed to attract businesses and talent and secured an estimated 66 venture capital deals in 2019, while Austin secured an estimated $2.2 billion invested across 263 deals in 2018.

Much like the metropolitan core, residents of these counties have generally healthy lifestyles, with low rates of smoking, alcohol, and drug abuse. They also have the second-lowest rate of mental health problems across all archetypes, including rural and semi-urban groups. However, access to healthcare systems is much more limited than in the core metropolitan archetype, evidenced by the lower proportion of adults with healthcare coverage. Rates of crime — especially violent crime — are high, even for urban areas. For example, although crime in Atlanta peaked in the 1990s and the number of murders has fallen since then, it remains high relative to other U.S. cities, with gangs playing a significant role; in 2014, 17% of all prosecuted homicides were gang-related.

Additionally, there are low levels of civic participation and social networks are weak; fewer than half of respondents say they frequently talk with (or trust) their neighbors, compared to 54% nationally.

SMALL SOUTHERN CITIES

Archetypes of urban prosperity 6
Archetypes of urban prosperity 7

The least prosperous urban archetype is found in small southern cities, the counties of which are mostly in Georgia, but notably exclude the central counties of Atlanta. A member of this archetype is New York’s Bronx County, as it has more characteristics in common with these Georgian counties than its geographic neighbors. The population of these urban areas has a particularly high African American share and a commensurately lower white and Asian American share.

These counties experience very high levels of crime and weak bonds of trust between people. This has become an increasingly urgent issue, with rates of murder increasing by 15% over the last decade and the number of injuries resulting from mass shootings almost doubling in the same time frame. Education is also an issue across these counties. Georgia’s pre-K education system was established in 1992 and is now among the best in the country, but the investment and high enrollment rates have not yet translated into improved results in the K-12 system. High-school grades and graduation rates are some of the lowest in the country. Although these rates have been steadily climbing over the last decade, improving educational attainment further could help to improve the job prospects of residents and reduce the high crime rates found in these cities.

A combination of factors means that residents of small southern cities have some of the worst health outcomes of all counties analyzed. The high prevalence of behavioral risk factors, such as smoking and illicit drug use disorder, contribute to some of the highest rates of mortality at each stage of life. Furthermore, in 2017 almost 18% of people experienced food insecurity which has been linked with high rates of diabetes — a condition from which 11.7% (up from 10.6% in 2010) of people living in these counties suffer.

Poverty rates are also disproportionately high in these counties, with 24% of people living below the federal poverty line. So too is the rate of homelessness very high, at 35 for every 10,000 people, over double the national average of 17 per 10,000. This problem is compounded by a severe lack of affordable housing; in 2018, approximately 9,000 total houses were added in Georgia outside of the greater Atlanta metropolitan area. Most of those were student accommodation and covered only half the resident population growth from 2017 to 2018. The failure to build enough affordable housing is stifling economic development; for firms to move into cities outside of the state capital, affordable housing must be available in numbers it currently isn’t.

The human cost of unavailable and unaffordable housing has been brought into sharp relief with the coronavirus pandemic; the Bronx, for example, hosts nearly a third of New York City’s shelter population — a demographic who are unable to take precautions such as social distancing and are particularly vulnerable as a result. This is the major challenge for small southern cities, and home builders are already lobbying to loosen ‘over-reaching’ government restrictions on residential buildings in Georgia. Doing so would contribute to alleviating many of the housing issues these cities face, as well as opening the door for business expansion and economic growth.

CONCLUSION

Despite the large differences that exist across urban America, the urban archetypes of prosperity display many similar patterns. Transport and communications infrastructure is high-quality and well-connected. The population of these cities, which is made up of a large share of working-age people, demonstrates a high degree of social tolerance. However, there are also challenges which are pervasive across each of these urban environments: crime rates are high and increasingly problematic, education outcomes tend to be weak, and the availability of affordable housing is an ongoing problem.

However, the solution to these problems is not necessarily the same for each archetype, and there is the potential for learning between communities. If the metropolitan core cities, for example, adopted more business-friendly regulations that are more prominent in the large southern cities, they could capitalize on their already high levels of economic dynamism.

Similarly, small southern cities could implement similar public health campaigns as those used in the metropolitan core. These include the Los Angeles Healthy Community Neighborhood Initiative, a successful community-academic partnership, or the Live Well, San Diego! initiative which has seen success in addressing behavioral risk factors, such as tobacco use and poor diet, as well as raising community awareness of low-cost sources of healthcare.

Beyond policy learning between archetypes, there is also the opportunity for policy learning within archetypes. For example, The Creative Learning Initiative (CLI) based in Austin aims to transform education in the city by creating community networks that increase social participation and support holistic child development, as well as implementing creative teaching strategies. These have already seen success, with CLI students nearly 10% more likely to pass Texas’ state reading assessments. Similar initiatives in other southern large cities could not only improve education outcomes, but also improve rates of civic and social participation.

Registered Office: 11 Charles Street, London, W1J 5DW