Big Changes in Metro Atlanta’s Demographics Are Reflected in Its Schools

By Matt DeVeau, Project Manager

In many ways, Metro Atlanta is emblematic of the fundamental demographic and socioeconomic shifts occurring in the United States. Last month, the Pew Research Center released an analysis showing that 78 counties in 19 states transitioned to “majority-minority between 2000 and 2013. Of the five counties that experienced the biggest proportional declines in non-Hispanic white population, four were in the Atlanta region. And on the topic of rapidly rising suburban poverty, Metro Atlanta is often utilized as the poster child: in the past two years, prominent national and international publications such as The Atlantic, The Economist, and Politico have led trendpieces on the topic with anecdotes from Cobb and Gwinnett counties, the two most populous suburban jurisdictions in the region. These changes have profound implications both locally and nationally, and as a Metro Atlanta resident who thinks about community and economic development for a living, they are never too far from my mind. 

Yet I still found myself surprised at a recent snapshot of radical changes in the racial and ethnic makeup of the region’s school systems. The Atlanta Regional Commission, the metropolitan planning organization for a 10-county footprint inside a larger MSA, posted to its research microblog an analysis showing enrollment changes from 2000 to 2014 at the 15 public school districts within its service area. The post is brief and well worth checking out, but the upshot is this: the types of changes occurring (minority enrollment up overall, white enrollment down in most places) are to be expected, but the degree to which they are occurring is astounding. 

For instance, in a region with just shy of 780,000 students as of October of last year, Hispanic enrollment had grown by more than 100,000 students between 2000 and 2014, with every district posting a gain. Meanwhile, the white population had declined by more than 45,000. A handful of individual districts experienced especially dramatic shifts. As shown in the following graphic, the proportion of white students in Rockdale County declined by 51 percentage points while its share of black students grew by more than 40 percentage points. Proportional declines in white enrollment in excess of 40 percent also occurred in Douglas and Henry counties, while the share of Hispanic students in Gwinnett County increased from 10 percent in 2000 to 28 percent in 2014. (Not coincidentally, Douglas, Gwinnett, Henry, and Rockdale were the four metro counties identified in the aforementioned Pew Research Center analysis.) 

School System Composition Change: Percentage-Point Change in Enrollment, by Race/Ethnicity, 2000-2014 

Source: Atlanta Regional Commission 

White enrollment grew in just five districts, and these generally fall into two distinct categories – urban and quasi-exurban: the school districts for Atlanta and Decatur (a small city approximately five miles east of the region’s center) are urban areas that have experienced rapid gentrification in recent years, while the Cherokee and Forsyth districts cover areas far from the region’s core that had their development booms much later than the suburban counties closest to Atlanta.* To be clear, those four districts on aggregate still have 22,506 fewer white students than the combination of Cobb and Gwinnett. But it’s not an oversimplification to say that in the new millennium, white populations with school-aged children have grown in the region’s center and on portions of its periphery and decreased everywhere else.** And while all districts have diversified in one way or another, the change has been most profound in suburban districts that were mostly white just 15 years ago. 

My guess is that the story is similar in many other parts of the country – that Metro Atlanta is once again a microcosm of the whole. If that’s true, K-12 districts are already faced with a set of evolving challenges and opportunities. Community and economic developers with a vested interest and a strong and thriving talent development pipeline must take note. 

* Located at the region’s northwest edge, Buford is something of a hybrid between small town and far suburb that has historically had its own district apart from Gwinnett County Public Schools. 

** Interestingly, the trend has been titled more toward the core since the onset of the Great Recession. According to the full dataset from the Georgia Department of Education, Cherokee and Forsyth schools added a combined 13,737 white students between 2000 and 2007, compared to just 1,151 in Atlanta and Decatur. But between 2007 and 2014, things have practically been even, with the urban districts adding 4,065 white students compared to 4,608 in Cherokee and Forsyth.

Talent Development through Volunteer Opportunities and Civic Engagement

By Katie Thomas, Project Associate

Measure of America, a Project of the Social Science Research council, released a report last week on disconnected youth in the United States titled, "Zeroing in on Place and Race." Disconnected youth are defined as individuals between the ages of 16 and 24 that are not in school or working. The report found that 13.8 percent of individuals within the age group were disconnected, which adds up to roughly 5.5 million teenagers and young adults. In some metro areas the percentage of disconnected youth in the community topped 20 percent. One out of every five teenagers and young adults in the community were not working or in school. 

Individuals that are disconnected in their youth are more likely to be living in poverty, to be unemployed in adulthood, and to have higher incarceration rates, among other negative outcomes. Their situation sets them behind their peers, decreases their chances of success and self-sufficiency, and has long term implications on the community as a whole with outcomes such as cycles of multi-generational poverty. Additionally, disconnected youth are costing the nation billions of dollars in social assistance, medical care, incarceration expenses, and likewise, lost tax revenue, wages, income, and productivity. Measure of America estimated that the direct cost to taxpayers was $26.8 billion in 2013. 

Disconnected Youth Infographic 

Source: Measure of America 

So, what can be done to decrease the number of disconnected teenagers and young adults? Well, there are several strategies that communities can take to engage their disconnected residents, and one option is to get them to volunteer. Opportunity Nation and Measure of America found that volunteerism, group membership, and civic engagement have a positive impact on economic opportunities, upward mobility, and outcomes for the individual and the community. The likelihood of low-income youth to be disconnected if they do not volunteer was 19.3 percent for whites, 27.7 percent for blacks, and 20.9 percent for Hispanics; the likelihood of disconnection with volunteerism drops to 11.9 percent in whites, 17.8 percent in blacks, and 13.0 percent in Hispanics. 

The Citi Foundation’s Pathways to Progress, is a $50 million initiative to expand economic opportunities for 100,000 low-income youth in 10 major U.S. cities. One initiative is Service-Works, which partners with AmeriCorps VISTAS and Points of Light. Its strategy is to use volunteerism and civic engagement to develop soft skills, gain leadership experience, and prepare low-income youth for college and career success. Their study found that youth engaged in volunteering are half as likely to be disconnected compared to teenagers and young adults that do not volunteer. 

In order to have a prosperous community, residents must be given the opportunity to lift themselves out of poverty and move up the social and economic ladder. Volunteering offers valuable experiences and important opportunities to develop and foster the necessary skills to succeed. Further, civic engagement encourages them to invest early-on at improving their community. The people in a community are its biggest assets, and with the trend of companies moving to where a qualified talent pipeline is available, a strong workforce and community is necessary to compete on the national level for jobs, workers, and residents. Nationally, it is important that individuals are afforded the same opportunities to succeed, regardless of race, ethnicity, or where they grow up. 

If we fail to provide these opportunities, we will waste one of our greatest assets and lose out on the productivity and prosperity that could come from these individuals, given the right tools and talent development. Reaching the disconnected youth of your community and reengaging them is important to creating a sustainable, quality workforce and a strong, health community and economy. Increasing civic engagement and volunteerism, alone, will only be a part of the solution, but it is one step that can be taken to at least alleviate some of the problem and provide opportunities for some of the millions of disconnected youth. 

To see what percentage of youth in your metropolitan area are not in school and not working, you can find the report at http://www.measureofamerica.org/youth-disconnection-2015/.

Sustainable Development — Economy, Ecology and Equity

By Jim Vaughan, Senior Fellow 

When I was president of the Chattanooga Area Chamber in the 1990s, our chamber, economic development organization, community leaders and elected officials developed a community growth strategy based on sustainable development. 

Sustainability was a new term for cities and my friend and city councilman Dave Crockett, an early leader in the movement, helped position Chattanooga as a national leader among sustainable cities. 

In 1994, we hosted the first national meeting of the President’s Council on Sustainable Development where Vice President Al Gore called Chattanooga “an environmental success story, not only for the United States, but for the world.” 

As a native Tennessean, Gore’s declaration could be viewed as a play to the home folks except that Chattanooga was making quite a name for itself— 

•  It cleaned up its air, meeting all federal standards, just 20 years after legendary CBS News anchor Walter Cronkite said Chattanooga had the worst air quality in America; 
• It engaged thousands of citizens in a public planning process to envision Chattanooga as the “best mid-sized city in America” and attracted the public and private resources to realize its dreams; 
• It constructed the Tennessee Riverpark—walking and biking trails along the Tennessee River, six fishing piers, public art throughout, and including active and passive destination parks; and 
• It opened the world’s first and largest freshwater aquarium in 1992 as the lynchpin of the transformation of the city’s downtown. 

Fast forward 21 years and today, almost every leading city in America has embraced sustainability and is committed to prosper with a stronger economy and through environmental excellence. 

____________

But sustainable development includes three elements—economy, ecology and equity. How are we doing on the equity front? 

Not so good. 

Between 2000 and 2013 every state has seen its share of middle-class families shrink, according to a Pew Charitable Trust report. 

The current federal minimum wage, $7.25 per hour, has not been increased since 2009. And even though 29 states have minimum wages above the federal minimum, none would qualify as a “living wage” which is typically $10.00-$14.00 per hour. 

Workers aren’t benefiting from their increased productivity. From 1948 to 1979, net productivity rose 108.1 percent, and hourly compensation increased 93.4 percent. But from 1979 to 2013, according to Economic Policy Institute, while productivity rose 64.9 percent, hourly compensation rose only 8.0 percent. 

Sociologist Tali Kristal has documented that the share of revenues going to wages and benefits in manufacturing has declined by 14 percent since 1970, while the share going to profits has correspondingly increased. 

CEO-to-worker pay-ratio was 20-to-1 40 years ago, according to the AFL-CIO. Today it’s 354-to-1. 

Scientific American, in a March 31, 2015 article, “Economic Inequality: It’s Far Worse Than You Think,” paints a pretty bleak picture of America in the 21st century when it says, “We may not want to believe it, but the United States is now the most unequal of all Western nations.” 

The article also references an infographic video on wealth income inequality in America that went viral and has been watched more than 16 million times. It’s worth looking at right now. 

____________

More than 100 years ago, Henry Ford roughly doubled his workers’ wages to $5.00 a day. “No one loses anything by raising wages as soon as he is able,” Ford said. “Low wages are the most costly any employer can pay.” 

“The new wage rate set off seismic shifts in American society,” wrote John Galagher in the Detroit Free Press. “A tidal influx of job candidates from the South and around the world flowed into Detroit. Factory jobs became prized, helping turn America into the world’s industrial colossus.” 

In 2015, Walmart raised its minimum wage to $9.00 per hour. Hardly a seismic shift, but the world’s largest retailer is running television ads to say they are “investing in the most important part of our company, our people, because a raise in pay raises us all.”
President Obama has called economic inequality “the defining challenge of our time.” But even if it is just one of the defining challenges we face, it’s time for chambers and economic development organizations to remember that sustainable development is about economy, ecology and equity.

Starbucks Is Trying to Save The American Dream One Barista at A Time

By Stephanie Allen, Project Assistant

Last month’s The Atlantic magazine caught my eye at the airport newsstand. Next to a tattooed barista wearing a green Starbucks’ apron and matching green mortarboard, in huge white letters, the cover asked boldly “Can Starbucks Save The Middle Class?” I don’t usually buy magazines at the airport, but I bought this one. I wanted to know the answer and I wanted to know how they proposed to do it. 

The article was about Starbucks’ partnership with Arizona State University to offer all Starbucks employees a free four-year college degree through ASU’s online program, which was first announced last June.[1]  Starbucks says it’s about creating access to the American dream. ASU says they’re not trying to save the world, but merely trying to show that the world can be saved. 

It’s some soaring rhetoric to be sure and although no one comes right out and says it, the implied answer to the question on the magazine’s cover is, in a word, yes. Even if Starbucks can’t do it alone, they’re blazing a trail that others may follow. 

The program has been up and running for a year (an academic year). There are far fewer students enrolled than Starbucks predicted, but so far their retention rate is good, 87 percent (three percent higher than ASU’s typical online student rate). At least part of the credit for that goes to the innovative strategy of assigning each enrolled employee an enrollment counselor, a financial aid advisor, an academic advisor, and a success coach who calls at regular intervals throughout the semester to check in and see how things are going, to offer advice, and just to listen. 

As I finished the article, I found myself agreeing with the implied answer. This is a very interesting model and they’re innovating quickly and incorporating what they learn about how students best perform and what services are most helpful in seeing them through to graduation. If even some of these strategies were applied at institutions of higher education across the nation, I bet we’d see significant increases in college completions. This program is small enough to be nimble, and smart enough to innovate when the numbers don’t bear out their working theories. 

I thought, wow, they really are doing something important and valuable and they’re developing a model others could implement. I wanted to toast Starbucks and ASU for just getting up and jumping in and doing something to try and solve a problem we all acknowledge, but don’t do much about. 

But, I also found myself thinking that there’s a BIG assumption lurking behind that question “Can Starbucks Save The Middle Class?” and behind its answer. An assumption that doesn’t quite seem right: a bachelor’s degree is necessary if you’re going to make middle class wages. 

I am not saying that assumption is wrong. We’ve all seen the statistics. It seems that in America at the moment (and for the foreseeable future) that’s just reality. What I am saying is that maybe it shouldn’t be reality. Can a college degree save the middle class? Maybe, but at what cost? A bachelor’s degree is an expensive ticket to the middle class. 

Howard Schultz, the CEO of Starbucks, said his company’s partnership with ASU is about creating access to the American dream. We all used to have access to the American dream. And, that we all had access to it was what made it the American dream—the dream that hard work and perseverance were all it took to be successful in this country. Somehow, and without fanfare, the American dream seems to have become pay-to-play. 

Starbucks and ASU are, in a small way, for a small number of people, making the American dream accessible again by covering the cost of tuition and providing some much needed support services to make it easier for Starbucks students to complete their degrees. 

This is a big step, especially if other public and private entities see the social value of a program like this and follow suit. 

This is America. The American dream is a fundamental part of our understanding of what America is. It’s a problem if it’s no longer accessible to all of us. Is the only way to make it accessible to make a college education free? If you buy the assumption that a bachelor’s degree is necessary to make middle class wages, then you might think so. 

But, there are plenty of jobs that pay middle class wages that require skills and knowledge that don’t correspond to the skills and knowledge one typically takes away from a bachelor’s degree. It may be true that many of these jobs still prefer to hire candidates with bachelor’s degrees, but perhaps that’s an artifact of this country’s focus on college education to the detriment of any other sort of program for acquiring skills or knowledge. 

If we could revise our system, take stock, shift some of our focus (and funding) towards technical and vocational programs like those in Germany, we might find an alternative route to the middle class through technical skill development. But, this kind of education isn’t cheap to provide either. So, if we were to make this a viable alternative route to the middle class for large numbers of Americans we would still need to make sure that the cost of this sort of education also isn’t prohibitive. 

If we want to save the middle class, we’ve got to save the American dream. We have to make sure that the route to the middle class is accessible to anyone who’s willing to work hard and persevere. 

[1] When it was originally announced last year, the program would pay for the last 2 years of a student’s 4-year degree. Students who already had 2 years of college credit could finish their degrees for free. Students with less would get a 22% tuition reduction for the credits needed to get them up to the 2 years worth of credits mark and then the rest of their degree would be free. Starbucks recently announced that the program would now cover the cost of all four years of a bachelor’s degree.

Better Communities through Cat Herding: the New Reality of Economic Development

By Alex Pearlstein, Principal, Vice President

Despite all exhortations to the contrary by people in and out of the business, economic development is still a pretty traditional enterprise. Many economic development organizations (EDOs) still focus most of their attention on external marketing and recruitment, despite that fact that, 1) the number one issue increasingly voiced by employers is a dearth of quality talent, 2) about 80 percent of jobs are created by a community’s existing businesses, and 3) prospect relocations of any size are few and far between these days. I think it stems from a “what will I do all day” mentality. If I don’t respond to RFIs, plan marketing missions, go to trade shows, and manage prospect solicitations and visits, what the heck will I do all day? It’s a valid question. 

My own philosophy is that economic development is essentially the development and marketing of a “product” and that product is the community. EDPros sell their communities, whether that’s to existing businesses considering expanding or relocating, external prospects, skilled talent, entrepreneurs, developers, investors, etc. Just like a business must focus energy on optimizing all aspects of its product, so too must an EDO. So that essentially runs the gamut of any element that affects a place’s competitive position. Education and training, quality of life and place, leadership capacity, diversity and inclusion, infrastructure of all types, entrepreneurial dynamism – you name it. So if economic development is product development and economic developers market those products, then it follows that they should be involved in championing, overseeing, coordinating, contributing to, and advocating for the optimization of the product. Therein lies the rub; you can’t define an occupation as “doing everything” because that person would end up doing essentially nothing. 

It’s probably more useful to think of an economic developer not so much in terms of a person but an entity – in fact, that IS the direction the industry is headed. An economic development entity should be comprised of professionals that work on product development concurrently with product marketing; the nation’s top EDOs do just that. Principally, they have staff dedicated to external marketing, internal retention and expansion, small business development and entrepreneurship, education and training, and policy and advocacy. If they do not directly implement programs in these buckets, then they have partnerships with organizations that do. However, there’s another role creeping into the most cutting-edge EDOs. For want of a better term, let’s call it “product development coordination.” Almost like a hybrid of a company’s HR and corporate strategy departments, this responsibility involves creating a vision, building a holistic network of partners to implement that vision, and then coordinating the multiple moving parts involved in activating and sustaining the vision. 

There’s a super-fancy new term for this process called “collective impact.” While collective impact is currently focused mostly on educational improvement or social services initiatives, I think it will increasingly nose its way into economic development. Why is that? Because the process is all about creating, leveraging, and sustaining effective partnerships to advance challenging efforts, and nothing is more challenging than the cat-herding responsibilities around community product optimization. Of Market Street’s client communities, the best existing example of a (to use the collective impact term) “backbone” organization shepherding a holistic regional strategic process is the Greater Des Moines Partnership’s Capital Crossroads initiative. What a recent mid-course review of the first strategic cycle told us was that economic development collective impact is hard, complicated, oftentimes frustrating, but ultimately rewarding work. Another takeaway was that an EDO needs full-time dedicated staff to effectively manage and coordinate a truly comprehensive, holistic, “product development,” collective impact initiative. So the Partnership hired a terrific staff person to administer strategic implementation. And, oh by the way, to even be in a position to herd the cats, the organization needs to be trusted and respected by the cats. Which the Partnership also had going for it. 

The other big issue facing EDOs in a changing world is one that cuts to their very core: resource development and demonstrating return on investment. Traditionally, ROI equaled job and investment growth and investors were typically companies that benefitted from corporate expansions or relocations: commercial and residential developers and brokers, banks, law firms, accounting firms, planning and engineering firms, etc. Companies that didn’t see business at the table wouldn’t feel the need to pull up a chair through investment in a multi-year economic development program. 

Unfortunately, this “pay to play” model doesn’t work so well in the collective impact economic development world. Nor do traditional ROI measurements of jobs and investment. To be successful in community product development, you need networked partners from all key local public, private, institutional, and civic constituencies. Many of these entities won’t have the resources to invest in building the capacity needed for an EDO to successfully staff its programs and new coordination role. So we’re talking about the need for some leaps of faith here from all potential partners with resources. This is critical because ROI for a holistic initiative must be equally holistic. We’re talking jobs, investment, poverty rates, educational attainment, young professional cohort percentages, high school graduation rates, crime rates – any metric that speaks to community product optimization. Without strategic investments made for more altruistic, community-serving purposes, EDOs simply won’t have the necessary capacity to be product developers/coordinators as well as marketers. 

I think that EDOs will increasingly embrace their collective impact roles and step up to the responsibility of cat herding in the name of better, more sustainable economies and communities for current and future generations. The alternative is the drying up of resource wells for traditional organizations that will have harder and harder times justifying current levels of investments for increasingly diminishing returns.

What happens in Reno hopefully won't stay in Reno

Ranada Robinson, Research Manager

Last week, I had the amazing opportunity to spend three days in Reno, Nevada with a stellar group of young urban professionals with a diverse range of areas of expertise from cities all over North America at the Vanguard Conference hosted by Next City. We explored, we networked, and we worked together to brainstorm creative ideas. I made many contacts, and I hope to keep in touch with them all. There are so many people dedicated to making communities better, and it was wonderful to spend time getting to know what we each do and think about various issues. Here are just a few of my favorite moments.

To get a real-time glimpse of my experience as a Vanguard in Reno, check out Market Street’s Twitter feed from May 6-8.

Tour of the Reno Post Office 

I enjoyed seeing the historic Reno Post Office because it reminded me much of Atlanta’s Ponce City Market. It’s an old government building that is currently undergoing a makeover and will be repurposed. When its transformation is complete, it will be called FiftySouth Virginia and will feature retail and office space while preserving and highlighting the most historical parts of the building. This building will likely bring much more foot traffic to the Riverwalk District. Exciting! 

Small Business and Entrepreneurship Tour 

We visited Startup Row and spoke with a few entrepreneurs in Reno. Startup Row began because entrepreneurs wanted to be around each other and figured out how to make it happen. The Reno Collective, a co-working space, and EDAWN, the economic development authority, have worked hard to create a supportive space for companies. Two really cool products that have come from their work are this infographic and the Reno Startup Deck, a deck of cards that feature all the contact information for resources and existing entrepreneurs to support new business owners. These are really great marketing tools, and the business owners we talked to are very happy to be growing their high-tech businesses in a gorgeous and up-and-coming place like Reno. 

Big Idea Challenge 

One of the major components of the conference was the Big Idea Challenge, a competition to come up with the best tactical urban intervention for three opportunity sites in downtown Reno. The winning ideas will be funded with a $10,000 implementation grant from the City of Reno and the Nightingale Foundation. On Thursday night, over 300 stakeholders in the city joined us as we presented our ideas at Cargo at Whitney Peak. The room was packed with people and energy. Before we arrived in Reno, we were divided into groups and assigned one of these opportunity sites. Then throughout the conference, we had time to look at the site, discuss our ideas, come to consensus, then develop a PowerPoint presentation. My team was charged with developing a proposal for the use of The Lids, also known as ReTRAC (the Reno Transportation Rail Access Corridor). The Lids are basically two concrete pads that cover depressed railroad tracks. The space is vacant and rarely used but in a great location downtown. 

My team consisted of (from left to right) Noah Silverman of the Reno Bike Project, yours truly, Theresa Hwang of the Skid Row Housing Trust in Los Angeles, Adam Meagher of the NYC Economic Development Corporation, Lora Lillard of the City of Portland Bureau of Planning and Sustainability, Michael Martin of HD MADE in New York, and Alen Amini of the Corps Member Education Foundation in Cincinnati.

We all agreed that we wanted to infuse public feedback as a main focus of our idea, and we wanted to leverage its historical use as an event space and/or vendor area. We then named ourselves All Aboard, Reno both for the tie to the train tracks that used to run through downtown Reno and for the citizen participation we were seeking to encourage. What we presented on Thursday night was a step by step process of engagement, starting with hiring a part-time Community Engagement Fellow with the $10,000; creating a Participation Station, a place to gather ideas for future events or space uses from the public, at an existing upcoming event (like the Reno Sculpture Fest this past weekend); engaging partners, particularly local businesses who could sponsor future events; and creating a feedback loop that included online and physical components. The point of our idea is that through a series of events bringing residents' dreams to life for a day, whether activities like yoga or community theater at The Lids or sample space uses like a skate park, the City would be able to observe which ideas were most popular, while giving a platform for local businesses to show what they have to offer. This method not only creates buy-in, but it connects citizens to that actual space and gives people a reason to venture to that area since it’s not currently heavil trafficked area. 

Although our idea didn’t win, we did receive tons of positive feedback from the city leaders in attendance and from our fellow Vanguards. So who knows? Maybe we’ll see our idea come to fruition one day, either in Reno or in some other place with a great vacant space.

Lake Tahoe 

Before my red-eye flight back to Atlanta, I joined a group of new friends on an hour-drive to Lake Tahoe for lunch. The place is simply breathtaking. We spent a couple of hours just talking about our favorite moments of the conference, talking about work and our communities, laughing, and just connecting. It was the perfect end to a very interesting trip!

Myeta Moon of Kaboom! in Washington DC, Ceara O'Leary of the Detroit Collaborative Design Center, Lakisha Hull of the City of Los Angeles Department of City Planning, moi, and my team member Theresa Hwang

 

Fasten Your Seatbelts – Driverless Cars are Coming

By Ryan Regan, Project Associate

I’ve been hearing a lot lately about self-driving cars. In March, a Delphi Automotive autonomous driving SUV completed a cross-country 3,500 mile trip from San Francisco to New York making it the first driverless vehicle to ever drive coast to coast. Supporters of the driverless vehicle allege that this invention will completely revolutionize just about every aspect of modern life, and after reading up on the topic, it’s hard for me to disagree. However, regulatory, ethical, and political issues that come along with the driverless car movement will be numerous, and it will be interesting to see how these issues are dealt with by skeptics and supporters alike. Regardless, their eventual adoption into our lives will change the way we approach everyday tasks, and that includes the way we approach community economic development. Below is just a sampling of the impacts expected from widespread driverless car usage, which are either directly or tangentially related to community economic development.

Whole industries will dissolve while others prosper: It is hard to quantify the number of industries that will be disrupted or fold entirely in a world populated by driverless vehicles. The auto insurance, auto finance, replacement car parts, trucking, oil and gas, and rental car industries are just a few of the industries that will be affected. However, with disruption comes opportunity. Ride sharing service companies like Uber will surge as they integrate driverless car fleets into their business models. Inter-industry linkage opportunities between the automotive manufacturing and information technology sectors will be abundant, and potentially result in new jobs in fields that don’t even exist yet. Logistics and utilities industries will see upticks in efficiency as many of these company’s operations become automated and less prone to human error. In fact, some mining companies are already using driverless trucks, a move that has resulted in greater operational efficiency, increased productivity, and safer working conditions in an industry that is notorious for its safety issues. 

Millions of workers will need to be retrained in new careers: In 2014, there were 4.1 million people employed nationally in motor vehicle operator positions. The widespread adoption of driverless cars will render many of these occupations obsolete, and thus, require a concerted effort at the community level to retrain workers with the job skills that a post-driverless car economy willdemand. Community colleges, technical schools, and other workforce development partners will be relied on to reequip these workers with competitive skill sets. The short-term unemployment challenges that this dynamic creates are daunting. However, the availability of new labor will benefit additional industries that are starved for workers. The key will be making sure that these workers with service industry and manufacturing backgrounds receive adequate job skills training in the STEM fields that are increasingly in demand in the national economy.  

Public safety benefits will be dramatic: Over 30,000 people die each year in the United States due to motor vehicle collisions, and car crashes are the primary cause of death of Americans between the ages of 15 and 24 years of age.[i] According to the Department of Transportation, there was an average of one alcohol-related driving fatality every 51 minutes in 2012.[ii] The proliferation of cell phones, especially among inexperienced teen drivers, has also created a budding public safety crisis for anyone driving in the 21^st Century. All of these difficult public safety realities would be erased by driverless cars. Up to this point, seatbelts, antilock brakes, and airbags have been the most important safety features to become commonplace in standard vehicles. Still, these inventions do little to solve the primary root cause of almost all accidents: human error. McKinsey & Co. released in March what is perhaps the most comprehensive study conducted to date on the benefits of autonomous vehicles. The study found that self-driving vehicles could eliminate 90 percent of all auto accidents in the United States, and save the country nearly $200 billion annually in costs associated with wrecked vehicles (mainly healthcare).  

Traffic congestion will fall and worker productivity will rise: One study by researchers at the University of Michigan Transportation Research Institute estimates that driverless vehicles could cut average household vehicle ownership rates by 43 percent, as families consolidate vehicle usage in favor of more efficient driverless cars that can operate independently with or without a passenger. Fewer vehicles on the road will in turn result in less traffic congestion. The average commuter in the United States spends 38 hours a year stuck in traffic, which equates to nearly a full work week. The previously mentioned McKinsey study estimates that commuters worldwide could shave off 50 minutes a day in a world where driverless cars are the norm. The resulting increase in labor productivity can help to spur innovation throughout the global economy. 

Spending potential for individuals, families, and small businesses will be freed up: Amazingly, cars sit unused about 90 percent of the time. When you calculate both the upfront costs and the long-term maintenance costs, they are a big financial burden for many individuals and families. Conventional cars reduce the disposable income that someone has to spend on other things, and they can wreak havoc on a credit score. Small business owners and entrepreneurs can be especially burdened by the debt associated with car ownership, since additional debt obligations represent just another hurdle to hiring people and purchasing capital. Reducing the financial costs associated with car ownership may help to usher in an era of unprecedented innovation, commodity spending, and small business growth. 

A potential game-changer in combating global warming: In 2013, greenhouse gas emissions from the transportation sector accounted for 27 percent of all greenhouse gas emissions in the United States. Passenger cars and light-duty trucks were responsible for over half of the emissions in the transportation sector. Reducing the number of these types of vehicles on the road will greatly reduce the carbon footprint of your average U.S. family. Driverless cars will predominantly be electric and far more fuel efficient than conventional hybrid or gasoline-powered cars, which are hampered by the clunky driving patterns of humans. In 2014, the United States consumed 136.78 billion gallons of gasoline, and there’s no telling how drastically that number could fall with widespread adoption of driverless cars. 

Urban renewal opportunities will alter our built environment: Driverless cars won’t have the same parking demands as a conventional car, and thus, parking lots and parking garages may soon become ancient relics just like pay phone booths. It is estimated that as much as 30 percent of the land in many urban cores in the United States is devoted to parking. Paved parking areas are eyesores that have unfortunately become the most recognizable feature of the built environment in metro areas around the world. They also increase runoff, which increases the threat of flooding and contributes to the contamination of our waterways. As parking lots and garages become obsolete, there will be tens of millions of square feet of prime real estate freed up in downtown areas across the United States. This will help pave the way (pun intended) for exciting community economic development opportunities. Imagine if every parking lot in the United States suddenly became either a public park, or a community hospital, or a small business incubator, or a new public school? The potential impact on residential development will be equally significant. Housing could become much more affordable once land that was formerly devoted to parking spaces is freed up for new residential development opportunities. On the flipside, driverless cars may exacerbate problems with suburban sprawl as people become comfortable living further away from urban jobs centers due to the reduction in commute time that driverless cars will afford them.  

Even in the most optimistic scenario, driverless cars are a few decades away from being widely adopted by the consumer market. What impact will driverless cars truly have on society? Nobody knows the full answer yet, but one thing is for certain – we won’t have to stand in line at the DMV to find out.

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[i] “Preparing a Nation for Autonomous Vehicles: Opportunities, Barriers and Policy Recommendations.” Eno Center for Transportation. October 2013: p. 3.

[ii] “Traffic Safety Facts: 2012 Data.” U.S. Department of Transportation: National Highway Traffic Safety Administration. December 2013: p. 1.