Focus: Rating the Region's Quality of Life
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Introduction
For four years, MPIP has been analyzing data to portray the quality of life in communities across the greater Philadelphia region. Our project has two main goals: to enhance the understanding of patterns within this region, and to compare greater Philadelphia to other metropolitan areas. Whenever we present data from multiple regions, we use the same set of eight other metropolitan areas, selected because they represent these important types of comparison:
- Boston, Chicago, and Minneapolis are regions that outpace Philadelphia on many indicators; they represent our “aspirational” choices;
- Baltimore and Pittsburgh are regional competitors for Philadelphia, so we need to stay abreast of trends in both places;
- Cleveland and Detroit share many of the challenges that Philadelphia faces as an aging industrial region;
- Phoenix is the only one of our comparison group located in the Sunbelt, where it recently surpassed Philadelphia’s ranking as the 5th largest city in the United States.
For this web report, we have pulled together a set of indicators that assess the quality of life in the region along five crucial dimensions: employment, education, income, housing, and health care. Taken together, the numbers suggest that greater Philadelphia sits in about the middle of this comparison group. The Philadelphia metropolitan area shows significant strengths in comparison to its peers, but those strengths are counter-balanced by some weaknesses.
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EMPLOYMENT
We choose to present employment indicators first because of the central importance of work to the well being of residents and the region as a whole. For individuals and their families, having a job provides a more reliable standard-of-living than depending on government benefits or other sources of support. For the region, the levels of workforce preparation and participation are crucial contributors to economic growth.
Metro Indicator 1. Attachment to labor force
This indicator counts persons who remain permanently unattached to the world of work. They cannot be classified as “unemployed” because they are not even seeking jobs. This may be because they are caring for children or for elderly relatives. Or they may have a disability that prevents them from working. Possibly their low skill levels render them unemployable. They may simply have retired early. Or they may be in jail.
In all nine metropolitan areas, a larger proportion of adult women than men remain out of the workforce, in many cases because they carry a disproportionate responsibility for the care of children and other household members. Compared to other metropolitan areas, the share of Philadelphia’s adult women unattached to the labor market ranks at about the middle of the comparison group. (See Figure 1a)
Although the share of our region’s adult males who are unattached to the labor force is lower than the share of women, it is higher than the figure for adult men in all other regions in our comparison group except Detroit and Pittsburgh (see Figure 1b). One common explanation for Philadelphia’s large share of adults unattached to the work force is the comparatively low level of college education in this region, particularly within the city of Philadelphia. (See the Education indicators that follow in the next section.)
Metro Indicator 2. Unemployment rate
This indicator differs from the one above in that it reflects the employment fortunes of people who are attached to the labor force, either as employees or job seekers. Although we saw above that more women than men remain outside the labor force, those women who do enter the job market suffer less unemployment than men. In most of the comparison group of metros, men’s unemployment rate is higher than women’s. (See Figure 2a and Figure 2b.)
Interestingly, on this indicator, the Philadelphia area ranks more favorably than on the previous indicator, even displaying lower unemployment figures for both women and men than does our “aspirant” metro of Chicago. It is worth noting that unemployment rates are more volatile than the figures reported above for indicator labor force attachment.
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EDUCATION
Education is crucial to the quality of the work force, which in turn affects the region’s ability to attract new employers. Changes in the global economy have increased the competition among locales and put a premium on workers with abilities in reading, communication, and basic quantitative reasoning. Research shows that the quality of human capital available in urban regions is among the most important factors affecting the location decisions made by firms. Moreover, the level of education among the citizenry affects virtually all aspects of community and family life.
Metro Indicator 3. Percent of adults completing high school
Completing high school provides citizens with many advantages, including stable employment, greater earning potential, and the basic qualifications to continue their education at a higher level. People who leave high school without earning a diploma are unlikely to have the minimum skills and credentials necessary to function in today’s increasingly complex society and technological workplace. In addition, adults with low education and skill levels are more likely to live in poverty, to receive public assistance, and to become involved in crime.
Figure 3 shows that the percentage of high school graduates in the City of Philadelphia ranks in the lower half of the group of metropolitan regions we surveyed, at about the same level as Chicago. As a region, however, greater Philadelphia ranked in the top half of the list.
Metro Indicator 4. Percent of adults with higher education
Since knowledge industries are driving economic growth in both the city and region, a college degree has become the entry credential for many professions and occupations.
Figure 4 shows that within the City of Philadelphia, a smaller proportion of adults hold college degrees than in any of the comparison cities except Cleveland and Detroit. Recently, civic leaders in Philadelphia have drawn attention to an estimated 80,000 city residents who have some college credits, but have never completed a degree, emphasizing the need for the city’s institutions of higher education to pay special attention to this pool of prospective students.
As in Figure 3, the Philadelphia region as a whole fares better in Figure 4 than does the city alone. Compared with other metropolitan areas, greater Philadelphia falls in the middle of the group, with a higher percentage than four regions and a lower percentage than four others.
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INCOME
During the last two decades of the 20th century, the income structure of the nation changed significantly. The middle class shrank as manufacturing moved out of the United States, eliminating many jobs that had supported middle-class households. The two indicators in this section offer a picture of the two ends of the income scale—households ranking among the top earners in the nation, and households with incomes low enough to qualify for the Earned Income Tax Credit (EITC).
Metro Indicator 5. Change in high-income households, 1979-1999
Figure 5 shows that during the last twenty years of the 20th century, metropolitan Philadelphia improved its position slightly among the comparison group. In 1979 greater Philadelphia’s share of high-income households ranked near the bottom of the list of metros, barely larger than in Phoenix and Pittsburgh. However, our region was one of only three in which the proportion of high-income households increased during the two decades. The combination of Philadelphia’s small gain and Cleveland’s steep decline moved Philadelphia’s ranking up by 1999.
One surprise in Figure 5 is that Detroit maintained an impressive share of high-income households during this time period. Perhaps equally surprising is Chicago’s declining share of top-earning households.
Metro Indicator 6. Households claiming Earned Income Tax Credit
The taxpayers depicted in this indicator are those who are commonly classified as the “working poor.” The federal Earned Income Tax Credit (EITC) provides income tax relief to low-income workers by refunding all or part of their income, social security, and medicare taxes. Congress established this program to lessen the regressive nature of social security taxes. As the labor market in the U.S. has generated more low-income jobs, the EITC has become a tool to mitigate the effects of growing income inequality.
In Figure 6, Greater Philadelphia has the fifth largest percentage of households claiming the EITC. That suggests that the share of working poor households in our region falls in the middle of this group of metropolitan areas.
We note that the numbers portrayed in Figure 6 are affected by whether the public is aware that this tax benefit exists. Many people who could qualify for the EITC do not know about the program. Research has shown that particularly low-income workers without children fail to claim EITC benefits when they are eligible. (L. Burman and D. Kobes, “Analysis of GAO Study of EITC Eligibility and Participation,” on-line report from the Urban Institute, January 2002) In communities with vigorous advertising of the benefit, more claims are likely to be submitted by those who are eligible.
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HOUSING
Housing markets across the nation are currently experiencing the effects of the crisis in sub-prime mortgages. Despite this current turmoil, when we focus on housing fundamentals, we see that our region compares favorably with our comparison group.
The greater Philadelphia region benefits from a pattern of comparatively concentrated residential development and affordable prices, compared to other regions.
Metro Indicator 7. Residential density
In the coming era of higher fuel prices, people are likely to seek higher-density lifestyles in order to gain efficiencies in travel to work, shopping, and other daily activities. Communities benefit from higher density development because it creates efficiencies in providing water, sewer, electrical, policy and fire protection. It also supports local retail districts and mass transportation options. The changing composition of households in the nation and in our region means that only a minority of households, even in the suburbs, have children. The rise in smaller households is generating a need for smaller dwelling units that can be built most efficiently at high density.
Given these trends, it is not surprising that we see a growing market demand for townhouses and communities with town centers and walkable ground plans. Philadelphia is well positioned to serve this market segment. Compared with the other regions in Figure 7, Philadelphia has the highest residential density except for Boston and Chicago.
Philadelphia’s relatively compact ground plan means that it ranks favorably on residential density. And in fact, a number of suburban communities built at high density with walkable town centers and easy transit access now rank among the region’s preferred housing markets.
Metro Indicator 8. Housing affordability
Housing affordability is not simply a function of housing prices. Rather, it reflects the relationship between household income and housing costs. The prevailing assumption among housing experts is that households should normally spend no more than 30 percent of their income on housing. When house prices rise faster than people’s incomes, as they did in the recent real estate run-up in some parts of the U.S., many families are prices out of the market. Rapidly rising prices can discourage prospective residents from moving into the area and eventually discourage employers from locating in places where their employees will have a difficult time finding affordable homes and apartments.
Figure 8 shows that Philadelphia ranks in the middle of the comparison group, with a lower ratio of prices-to-incomes than in the booming housing markets of Boston, Chicago, and Phoenix. The rapid appreciation in those places means that housing costs have risen faster than incomes, pricing many households out of the market.
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HEALTH CARE
Adequate health care is a critical ingredient in the quality of life enjoyed by residents, particularly families with children and elderly family members. We select two indicators that affect the access to health care for residents of our region—the presence of primary care physicians to serve the population, and the extent to which residents are covered by health insurance. Access to health care depends not only on the presence of doctors in the community, but also on families’ ability to pay for physicians’ services.
Metro Indicator 9. Supply of primary care physicians
Does Philadelphia’s impressive collection of medical schools guarantee this region an abundant supply of physicians to provide primary care? Health planners caution that the presence of medical schools does not necessarily produce more primary care physicians, since primary care is not among the top specialties chosen by today’s medical students. So it is worth examining the supply of primary care doctors in the region.
Figure 9 shows that in fact, Philadelphia does rank at the top of our comparison group. For every 10,000 residents, our region boasts 13.7 primary care doctors, an even larger number than in Boston, another well-known center of medicine.
Metro Indicator 10. Health insurance coverage
Among the fastest rising costs faced by all households is their cost of health care, which has become increasingly unattainable to families without insurance coverage. So it makes sense to ask how large a share of the region’s population is uninsured. To answer this question, we have divided each region’s population into children (under 18 years of age) and adults (18 years old and older), showing the results in Figure 10a and Figure 10b. In every region, the proportion of children who are uninsured is smaller than the proportion of adults, largely because state governments have instituted programs to expand children’s coverage.
For both children and adults, Philadelphia ranks fifth among the comparison group—with higher shares of the population uninsured than is the case for Pittsburgh, Minneapolis, Boston or Cleveland. The discrepancy in insurance coverage in the Philadelphia and Pittsburgh regions makes clear that despite the role taken by state government in health insurance, significant differences may exist between regions within the same state.
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