New Data on Economic Mobility in Atlanta and Charlotte: What Has Changed?
When we think about the American Dream—the idea that anyone can succeed if they work hard—it’s really about economic mobility.
Economic mobility is about the chances someone has to move up (or down) the economic ladder compared to their parents. If a child grows up in poverty but later earns enough to be considered middle class, that's economic mobility in action. On the other hand, if a child starts off in a middle-class family and falls into poverty as an adult, that's downward mobility.
The Changing Opportunity study, published by the Opportunity Insights team led by Harvard’s Raj Chetty in 2024, examines this issue. It adds new data and expands on findings from the original 2014 study.
The researchers looked at how children born between 1978 and 1992 have fared in terms of economic mobility.
Cities like Charlotte and Atlanta have played a big role in these changes, with Charlotte, in particular, showing some surprising results.
Back in 2014, Charlotte was ranked dead last—50th out of 50.
The city became known for its lack of opportunity, especially for those trying to move up from lower-income families.
Fast forward to today, and Charlotte has made some progress, now ranking 38th in the updated study.
It's an improvement, but it still suggests that there’s more work to be done.
How Was the Data Collected?
The Changing Opportunity study collected a massive amount of data, looking at the lives of 57 million children born between 1978 and 1992. The researchers pulled information from two main sources: census data and tax records.
They were able to track where these children grew up, what their families' financial situations were like, and how much they ended up earning as adults.
By linking this data, the researchers could figure out which children moved up the income ladder and which stayed at the same level or moved down.
In this study, geography plays a huge role. Researchers found that where a child grows up can have a major impact on their economic outcomes later in life. Factors like the quality of schools, the availability of jobs, and even social connections in different cities and neighborhoods helped shape economic mobility for the children studied.
Limitations of the Data
While the data from this study is incredibly valuable, it's important to remember that it has some limitations. One of the biggest limitations is that it looks at the economic progress of children who grew up in the 1990s as viewed by their economic outcomes as adults today, a generation later. Because economic mobility is about seeing changes over the course of a generation, a time-lag is built into how the research has to be conducted.
That means the data pertaining to childhood enivornments is 25 years behind where we are today.
The world has changed a lot since then, and this study can share only limited insights about the environment that children are growing up in right now.
For example, factors like the rise of technology, shifts in the economy, and even changes in education systems aren't fully captured in this study.
Instead, it gives us a picture of what allowed children from the '90s to succeed (or struggle) based on the environment back then.
While the findings are still important, we should remember that they're only part of the story.
4 Key Findings from the Changing Opportunity Study
The Changing Opportunity study provides some important insights into how economic mobility in America has changed over time.
Let’s break down the four key takeaways from the study.
1. The Black-White Gap in Economic Mobility Is Shrinking
One of the study’s most promising findings is that the gap in upward mobility between Black and White children has significantly shrunk over the past 15 years. This means Black children today have more chances to climb the economic ladder compared to previous generations.
For a long time, Black children, even those born into middle-income families, faced more challenges in reaching higher income levels than White children did.
Factors like racism, unequal access to good schools, and fewer job opportunities made it harder for them to succeed.
However, while this gap is closing, it’s important to note that racial differences still exist. Black children are still not on equal footing with White children in terms of economic mobility, and there’s still a lot of work to be done to achieve true equality.
At the same time, the study found that the class gap among White children has been growing.
This means that White children from wealthier families are continuing to succeed, while those from low-income families are struggling more to move up the economic ladder. In short, the gap between rich and poor for White families is getting bigger.
2. Opportunity in the U.S. Has Shifted Geographically
For a long time, coastal cities like New York, San Francisco, and other major metropolitan areas were known as places where people had the best chances to improve their economic status.
These cities used to be seen as hubs of opportunity, where children, regardless of their background, had a better shot at success.
However, the study reveals that this may not necessarily be the case.
Today, those coastal areas aren’t offering as many opportunities as they used to. Instead, areas in the South and Midwest, which previously didn’t provide as many pathways to success, are showing more progress in upward mobility.
These changes suggest that cities and towns in these regions might be doing something right - or at least, they did back in the 1990s - when it comes to improving economic chances for their residents.
Interestingly, in the places where Black children’s economic outcomes improved the most, White children also experienced better outcomes. This shows that when communities improve conditions for one group, it can have a positive effect on everyone living there.
3. Community Changes Are Driving the Different Outcomes by Race and Class
The study also found that the changing outcomes between different races and income groups are tied to shifts in the communities where children grow up.
One of the most important factors is parental employment rates.
In areas where more parents have jobs, children tend to have better chances of success, no matter their race or income level.
Why does this matter? Because when parents are working, the community is more likely to be stable. Stable communities often have better schools, safer neighborhoods, and more resources for children. When parents are employed, they contribute to a stronger local economy, which helps everyone in the community.
On the flip side, in places where there are fewer job opportunities for parents, children often have a harder time moving up the economic ladder. These communities tend to struggle more with issues like poverty, underfunded schools, and lack of access to important resources, making it harder for children to succeed.
4. Social Interactions Play a Big Role in Economic Mobility
One of the most interesting findings of the study is that the social interactions children have with their peers and the families around them can have a major impact on their future success.
Specifically, children’s economic outcomes are influenced by the employment rates of their peers’ parents—the people in their social circles. This means that who children grow up around and interact with matters.
If children are surrounded by peers whose parents are working and financially stable, they are more likely to be exposed to positive influences and opportunities. This could be things like seeing examples of successful careers, understanding the importance of education, or simply having access to better resources through those connections.
In communities where many parents are unemployed or struggling financially, children are less likely to have access to those same positive social interactions.
These four findings highlight some important trends in the way economic opportunity is changing in America.
While the shrinking Black-White gap is encouraging, the growing class gap among White households, the shift in geography, and the power of social interactions all point to new challenges.
What Has Changed for Atlanta and Charlotte?
In the original 2014 study on economic mobility, Southeastern cities like Charlotte and Atlanta ranked near the bottom.
These cities, despite being hubs of economic growth, had some of the lowest chances for children born into low-income families to improve their financial situations as adults.
Historical factors such as segregation, redlining, and limited access to quality education made it hard for many families in these areas to move up the economic ladder.
But how has the next generation fared?
Economic Mobility in Atlanta
Unfortunately, Atlanta hasn’t seen much improvement in economic mobility between the two cohorts of individuals born in 1978 and 1992.
For children born into low-income families in 1978, their chances of earning more as adults were quite low. By 1992, those chances hadn’t gotten much better. In fact, Atlanta saw a negative change in income, dropping by -4.7% for children born to low-income families, which was even worse than the national average decline of -4.2%.
Economic Mobility in Charlotte
Charlotte, however, has had a different story.
Like Atlanta, Charlotte started off with low economic mobility for children born into low-income families in 1978. But by 1992, the city had made major improvements. Economic mobility in Charlotte shot up, with the city almost reaching the national average.
This was mostly due to better outcomes for low-income Black residents, while low-income White residents remained stable.
In fact, Charlotte ranked third in the nation for improvement, with a 5% increase in income for children born to low-income parents in 1992 compared to those born in 1978.
So, Why the Change?
You might think the shift in economic mobility is due to changes in the economy or the time period. After all, Charlotte transitioned from a textile mill town to a banking hub, which has made the city more prosperous.
But the study suggests it’s not just about how the economy is doing or what jobs are available. The key driver of mobility is the environment children grow up in—things like schools, neighborhoods, and access to resources.
Two important pieces of data that back this up are high school graduation rates and SAT scores. These numbers aren’t directly impacted by the state of the economy.
Yet, children from low-income families in Charlotte are more likely to graduate high school and they’re scoring better on the SAT than before.
These improvements are promising and show that the efforts of local organizations may be making a real difference.
Policy Implications for Improving Economic Mobility
The Changing Opportunity study gives us some important clues about how we can increase economic mobility in the U.S. Here’s what we can take away from the study:
1. Focus on Helping Young People
Usually, policies aim to help adults who are already working or need to switch careers due to job losses. While these programs are helpful, the study suggests we should also pay attention to young people.
Investing in programs that support children and teenagers, especially in struggling communities, can set them up for a better future.
For example, when factories close or towns face economic hardships, we could create job training and mentorship programs specifically for young people. By investing in the next generation, we can prevent the negative effects of economic downturns from carrying over into their futures. Schools, youth programs, and targeted job training could also make a big difference.
2. Improve Communities, Not Just Neighborhoods
Many efforts to boost economic mobility focus on improving entire neighborhoods. While this is useful, the study highlights that what really matters is the social community around a child—basically, who they interact with, including their friends and their friends’ parents. These social communities are shaped by factors like race and class, even within the same neighborhood.
To help children succeed, policies should try to create more connections between different communities. For example, reducing segregation in schools, providing affordable housing in better neighborhoods, or changing zoning laws could help children from lower-income families access resources and social capital that can allow them to thrive.
3. Invest in Social Connections
Most economic mobility policies focus on giving financial help, like tax credits or grants, or improving education.
While these are important, the study shows that investing in social capital—the networks and relationships people have—can be just as crucial.
Programs that offer both financial support and strong social networks are often the most successful.
For example, housing programs that also provide guidance from experts or job training programs that connect people with employers can make a big difference.
Focusing on building social connections in communities with fewer opportunities could help improve economic chances and reduce disparities.
Conclusion
The biggest takeaway from this study is that improving opportunity can happen faster than you might think. Changes in a community today can impact the next generation and lead to quick shifts in economic mobility.
In other words, we don’t have to wait decades to see results—things can get better in a much shorter time.
There are three key ways to make this happen.
First, we need to invest in young people, especially in communities facing economic struggles.
Second, it’s important to focus on the social connections that shape communities, not just the neighborhoods themselves.
Finally, building relationships and networks—what we call social capital—is just as important as providing financial or educational support.
That said, it’s important to note that while these findings are promising, we don’t know for sure if they’ll translate to our current environment.
The challenges children face today are different from those in the past, and only time will tell if our current efforts will pay off in the future.
If you want to dive deeper into how mobility is changing in your area, the Opportunity Atlas, created by Opportunity Insights, is a great tool.
It allows you to explore more data from your community and can inform local solutions.
