Can low income households locate closer to employment?
The location of people throughout the metropolis is constantly in flux, in terms of who locates where. This means transportation investments to serve certain place-based communities or populations can often be misguided. Looking at the bigger picture, what are the goals of new transportation investment? Reducing congestion is the one that gets the most press. Opening up new land for development gets less but is still a very real objective for local governments in particular. One that is not explicitly talked about as much is to increase accessibility for people in general and especially for lower-income/mobility populations. Reducing congestion is part of doing so by reducing travel times. One may speculate that those with highest incomes value time the most, and have the financial resources to locate wherever in the metropolis will maximize their accessibility/minimize their time in transport. So do lower-income populations inevitably just get the short end of the stick?
This paper talks about the effect of income on commuting time. It also refers to the tension between the high value of time for high-income households, making them locate near job centers and minimize commute times, and the neoclassical theory of higher incomes leading them to consume more land and housing, causing them to locate further out. Through least-squares regression and other controls, it attempts to control for all other variables other than income. The paper mentions that commute times increase slightly as income does (18-24 minutes on average from lowest to highest income quartile). The coefficient for time in the model is positive, showing commute times increased as time went on (i.e. as people got older). Therefore, older people may tend to commute longer as well. The end result is that income has a positive (increasing) effect on commute times, but not much of one – the demand for more housing pushing them outwards and value of time pulling them closer virtually cancel each other out.
This is a good study and produces valuable information. What one must remember is that high and low incomes simply do not occur in isolation. There are many other factors including household size, presence of children and even personal taste for living space and commute time. Higher-income workers are unlikely to agglomerate in large numbers near job centers. With widely varying household characteristics and the financial ability to live almost anywhere, there is a low probability of getting the majority of them to live in close proximity to where they work. However, it’s interesting to note that while they have higher commute times than lower-income workers, they don’t commute much longer. Why is this?
In part, lower-income individuals face a different tradeoff. Having fewer financial resources, they are more likely to not own a car and thus have to use transit, limiting their access to jobs. Furthermore, the increased commute times created by taking transit make some jobs not worth it, and price some low-income households out of the labor market. Most wouldn’t consider commuting three hours one way for a minimum wage job. Research indeed shows (Ihlanfeldt 1993) that lower income households have a lower propensity to commute. This may suggest it’s more important – and more efficient – for lower-income households to be able to locate near their workplaces. Put differently, perhaps higher-income households, as a whole, are as close to their jobs as they wish to be, while low-income households probably aren’t.
Spatial mismatch literature suggests that the poor do have lower access to jobs. While this alone may not lead to significantly higher unemployment among this population, skill mismatch, in which jobs located near an area are poorly matched to the occupational skills of its residents, comes into play as a big issue as well (Immergluck 1998). Furthermore, another study (Covington 2009) suggests that most of the improvement in the poor’s access to jobs during the 1990s stemmed from the movement of that population closer to jobs, as opposed to jobs moving closer to them.
This would strengthen the argument for vastly increasing transit service in metro areas. This would be necessary because closely targeted transit investments may not be very effective for lower-income populations, given the unlikely event that these jobs cluster/agglomerate in small areas (as opposed to higher-income professions, such as finance). Such investments, which would include things like commuter rail, are probably more likely to favor higher-income groups more than anything. While this may not be politically possible at this point, there is a lot to suggest that offering extensive transit service throughout the metro is simply the most effective way to give the poor better access to jobs. This would reduce transportation costs for individuals and make any given location in the metro more accessible. It would potentially reduce overall costs for low-income households by reducing the need to move so often. If it allowed households to move less often, it might also stabilize and strengthen low-income neighborhoods.
Most of this does not speak to the congestion problem, of course. Nor does it actually speak to whether it would reduce vehicle miles traveled overall. It seems that the eternal challenge for transportation investment is simply figuring out ways to move everyone more efficiently. With the massive allocation of resources likely necessary to accomplish this, we probably won’t make progress on this front anytime soon. However, promoting equality in transportation and accessibility is certainly possible. Further research, which is needed, may indicate that bringing jobs within easier reach of low-income households may even improve congestion somewhat, and may lead to better economic outcomes overall.