Nashville: We need a common set of facts about equity and inclusive economic development

Equity is having a moment in Nashville. David Plazas is calling on business leaders to make a commitment to more inclusive growth and prosperity. Metro Council is passing symbolic resolutions. Mayor Cooper is promising a Nashville that works for everyone. How all of that goes from rhetoric to meaningful action remains to be seen, but declarative statements are a start. Two lines, in particular, caught my attention in Plazas's piece:

"The prosperity of recent years has disproportionately benefited people with higher incomes, who own property, and who have technical or higher-level skills."

"Meanwhile, wages have stagnated or fallen for long-term lower-skilled workers who have struggled to keep up, especially people of color."

I've heard different versions of those points made many times since I arrived in Nashville two years ago. Anecdotal evidence abounds about where the benefits of "New Nashville" are accruing, and how growth is exacerbating the gaps between newcomers and existing residents, the "haves" and the "have nots." But what does the data say? Are those claims accurate? And do they tell the entire story?

To be clear, I hope that Plazas and advocates continue to push our elected leaders to keep equity front and center of debate about economic development in Nashville. When Metro and its various stakeholder groups decide they are ready to have a serious policy, and not just tinker around the edges, I hope that equity will be its cornerstone. There are many good examples from other cities to draw from, including what we adopted in Austin.

But if and when that day comes we'll need more than testimonials and anecdotal evidence. Clearly articulating goals, developing strategies, and evaluating progress will require data and a serious commitment to open dialogue, transparency, and accountability. As with any public endeavor, everybody gets a say; all experiences are valid. But Very Serious People should not go unchallenged publicly because of what I've heard described as "Nashville Nice" or some distorted view of defining "politics" as one's inalienable right to dissemble when facts are readily accessible. This was part of our motivation behind launching the resident survey and publishing the data on Metro's open data portal. I hope the Cooper administration and new Metro Council continue down that path.

So, in that spirit, let's take a look at Plazas's points. We'll combine them here since they are somewhat related and restate the issue as follows: Are the benefits of Nashville's economic growth disproportionately accruing to people equipped with the tools (i.e. education, skills, etc.) to take advantage of it? And, if so, is that exacerbating inequality? I can't say for sure how Plazas would define or measure "benefit[ed]," but since he used terms such as income and skills it's probably safe to assume that he was thinking, at least in part, about workers. Which means the question becomes: Have wages "stagnated or fallen" for workers with lower levels of educational attainment compared to those with higher levels?

Here's a table showing growth in inflation-adjusted (real) average earnings for workers age 25+ in Davidson County by educational attainment and race/ethnicity for 2011-18. The data is from the Census Bureau's Longitudinal Employer-Household Dynamics program.

Average earnings for workers in Davidson County with no postsecondary education grew faster than any other cohort during that time period. In fact, average earnings for workers with no high school diploma or GED grew about three times faster than average earnings for workers with a bachelor's or advanced degree, according to Census estimates. Clearly, Nashville's recent period of economic growth has produced gains for workers across the spectrum of education and skills, not just at the top of it.

But I don't think that's what Plazas was really trying to say. I think his point was directed more toward issues of equity and affordability--and, in that context, he's absolutely right. Housing experts tell us that we should spend no more than 30% of earnings on housing costs to be considered affordable. Do that calculation using the 2018 figures in the table above and Plazas's argument comes into focus. For example, average earnings for Black workers in Davidson County are equivalent to about $1,000 in total monthly affordable housing costs. The average rent in Nashville now exceeds $1,400 per month.

It's the same story for Hispanic workers in Davidson County, as well as workers with no completed postsecondary education, on average. And the gaps are growing. Inflation-adjusted average rent in Nashville increased by 40% in 2011-18, compared to average earnings growth of only 5% for Black workers in Davidson County.

This is where the debate about inclusive economic development in Nashville, or any fast-growing city for that matter, should start. What combination of policies and strategies are going to effectively address these challenges resulting from economic success? In fact, we had a similar conversation in Austin this week with a group from Grand Rapids.

As any of my former students can attest, I feel very strongly--and very likely annoyingly so--about the importance of a call to action when developing a strategy. It's an often overlooked feature in practice. But if you don't have a compelling call to action it can be really difficult to get people engaged and participating in a serious way.

I'll offer this for Plazas's next one:

In 1998, when Nashville was a much different place, Black workers in Davidson County earned, on average, about 66% that of White workers. Today, despite twenty years of economic growth and opportunity, it's 59%.