Ignoring the Asian Vote

| Posted: April 24th, 2012

The Latino vote gets a great deal of attention during presidential campaigns—and understandably so. Latino voters in key states such as Colorado, Florida, Nevada, and New Mexico may well decide whether President Obama gets to stay through 2016 or Governor Romney takes over come January 2013.

But analysts, experts, strategists, and other talking heads are largely ignoring the Asian vote. Again, understandably so. Asian American Pacific Islanders (AAPI) make up only 4.8 percent of the U.S. population, a mere pittance of 14.7 million people compared with the 50.5 million Latinos. Moreover, AAPIs are not exactly known for their attendance come election time. Their share of the electorate hovers around the 2 percent mark.

In an extremely tight election however, every vote does count and the invisible Asian voter can make as much of a difference as her Latino neighbor. In highly contested Nevada and Virginia, AAPIs make up 7.8 percent and 5.6 percent of the population respectively.

Asian Americans are poised to be a force to be reckoned with in the near future. AAPIs are the fastest growing racial group, multiplying by 45.6 percent in the past decade, far outpacing the total U.S. population, which only grew by 9.7 percent. Their numbers have risen by at least 30 percent in all states, except in Hawaii where they are already the undisputed majority. Politicians should take note that the AAPI population grew by 116 percent in Nevada and by well over 80 percent in Arizona and North Carolina. Projections show that by mid-century, over 9 percent of the population will be of Asian Pacific Island descent.

As Don T. Nakashini, director emeritus of UCLA’s Asian American Studies Center, writes in the 2011-12 National Asian Pacific American Political Almanac: As voters, donors, public policy advocates, and elected officials, “Asian Pacific Americans seek to no longer remain as spectators to the parade of politics, or as vulnerable victims of partisan power struggles. Instead they are striving to become more organized, more visible, and more effective as participants and leaders in order to advance—as well as protect—their individual and group interests, and to contribute to our nation’s democratic processes and institutions.”

It just might be worth both parties’ time to pay Asian voters some heed.

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MetroTrends Week in Review

| Posted: April 21st, 2012

MetroTrends Weekly Roundup

Low-income families in America face a range of challenges about which MetroTrends bloggers have recently completed clear, data-driven research.

• Gregory Mills describes the encouraging results of a New York tax-time matched savings program that helps its low-income residents save up to $1500 per year
• Mary Cunningham tackles the question of foreclosures and homelessness, but the data are sparse and thus, strong conclusions are elusive
• Margery Turner cautions that, though mostly-Black neighborhoods in American metros have become more racially diverse, the pernicious effects of decades of segregation persist

The news is thus mixed, and so MetroTrends will continue providing empirically rigorous answers to these and other fundamental questions.

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Helping Low-Income Families Save: Lessons from Tax-Time Savings Accounts

| Posted: April 20th, 2012

With the tax season now over, it’s a good time to point out that tax-time matched savings programs are among the more promising approaches to boost low-income savings. In these programs, tax filers are encouraged to deposit some of their tax refund—primarily from the earned income tax credit (EITC)—into a savings account. Those deposits are then supplemented with match funds. One successful example is New York City’s $aveNYC Program, run through participating Volunteer Income Tax Assistance (VITA) sites. The program pays a 50 percent match on amounts up to $1,000 held in a $aveNYC account for a full year. In 2008-2009, the initial years of the program, 79 percent of participants received match funds. Of these accountholders, 71 percent re-upped the following year.

A just-released report by UNC-Chapel Hill’s Center for Community Capital provides insights on low-income savings behavior based on in-depth interviews with 48 $aveNYC participants—mostly African-American and Hispanic women between 25 and 50 years old. Consistent with other research, the study highlights the fact that children provide the strongest motivation for low-income workers to save because of the obligation to meet kids’ basic living needs, the instinct to serve as a role model for them, and the desire to provide them a better environment for growing up. To be realized, these impulses to save must be combined with confidence in one’s ability to save and a sense of trust in the financial institutions that hold one’s savings. And low-income households often lack that confidence and trust.

The basic message from this recent research—and the emerging body of work in behavioral economics—is that savings interventions need to nurture the intention to save and also make the act of saving easier. Whether someone is able to save (given that they can afford to) depends on a complex tug-of-war between their current impulses and their future plans. Savings tools such as precommitment, default-in/opt-out decision framing, and envelope budgeting are ways to enable our better selves to prevail.

Community-based savings collaboratives, such as savings circles where people pool their savings, have had some success helping the very poor save in developing countries. Is there a scalable way to do something similar in urban America? Can the motivational influence of one’s children be more effectively harnessed?

One possible untested approach is setting up a virtual savers’ club comprised of parents whose children share the same birthday. Parents could create a savings account on their child’s behalf and set a savings goal to be reached by the child’s next birthday. Members would receive periodic savings reminders and could compare their progress with the progress of other club members. This kind of self-induced competition has worked in energy conservation initiatives.

As with $aveNYC, the financial incentive to save could be strengthened by match funds—in this case, funds directed to a child’s account through donations from other family members or friends (or even a noncustodial parent). If this virtual savers’ club were widely marketed, other people who share the same birthday might be interested in making charitable donations of match funds to a child’s account.

In each of these cases, the necessary focus for savings interventions is clear: nurture the intention to save and enable the act of saving.

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Are Families Facing Foreclosure Becoming Homeless?

| Posted: April 19th, 2012

The most frequent question that comes across my desk is whether households facing foreclosure are becoming homeless. This is a tough question. The answer is that a few families may be trickling into homeless shelters, but probably not immediately after foreclosure, and not on a wide scale. Some limited evidence from DC shows this is the case. The rest of the answer requires some sleuthing. HUD data show that almost a quarter of families that entered shelter in 2010 came directly from a home they owned or rented. It is unclear how many of these situations are foreclosure related because shelters are not required to track this information. Plus, shelters are often a last stop on the residential instability road. Families facing foreclosure may move into a rental unit or double up with friends or family first. If these situations become unsustainable for whatever reason, the next stop may be the shelter. Indeed, the HUD data on shelter entry show that most families entering shelter come from doubled-up situations; but again, it is unclear how many are doubling up because of foreclosure. The lack of data is frustrating.

Previous Living Situation Before Entering Shelter

Source: HUD AHAR 2010.

Bottom line? It is hard to tell exactly how many families facing foreclosure end up homeless. But we know that forced displacement can produce residential instability, and we know from the research that residential instability is bad for school-age children, who may fall behind in class and spend a large part of the year playing catch-up. What should policymakers do about it? My colleagues Jenn Comey and Kathryn Pettit outline some recommendations here.

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The End of Segregation?

| Posted: April 16th, 2012

Earlier this year, the Manhattan Institute published an analysis by Ed Glaeser and Jacob Vigdor arguing that the twentieth century saw the end of segregation and that we should declare victory and turn our attention to other explanations for persistent (and widening) equity gaps.

I wish I could agree.

Residential segregation can be measured in many different ways. Sometimes, the metric that’s chosen drives the result. Glaeser and Vigdor focus on the extent to which blacks live separately from everybody else (whites, Latinos, Asians, people of mixed race or ethnicity). And indeed, this measure of segregation has declined substantially over the last few decades.

Take a look at the two pie charts below. The average black person’s neighborhood is dramatically more diverse today than three decades ago. But that’s mostly because many more Latinos and Asians now live in neighborhoods with blacks, not because very many more white people live there.

The average white person’s neighborhood—where more than three quarters of the neighbors are also white—also looks more diverse today than three decades ago, due to modest increases in neighbors of all non-white groups.

So Glaeser and Vigdor are right that blacks are less segregated from non-blacks than they were three or four decades ago. But blacks are only a little less segregated from whites.

Given our country’s bitter history of de jure segregation and systematic discrimination against African Americans, segregation of blacks from non-Hispanic whites (who possess the greatest wealth and power in our society) is a better measure than segregation of blacks from all non-blacks. By this measure, segregation is slowly declining, but it remains stubbornly high, especially in big metros with large African-American populations. And it’s in these metros that other measures of black-white inequality are also high.

Segregation certainly isn’t the only cause of racial inequality, but it’s inextricably entangled with gaps in school quality, employment and earnings, homeownership opportunity, and wealth accumulation. If we want to make progress toward a more equitable society, we can’t close our eyes to the persistence of residential segregation.

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MetroTrends Week in Review

| Posted: April 14th, 2012

Last week, MetroTrends bloggers looked behind the headlines, offering facts and analysis about both employment and housing woes:

• Rich Johnson debunks the suggestion that older workers are getting more than their fair share of jobs.
• Zach McDade introduces our latest interactive mapping tool showing foreclosures by zip code in hard-hit Prince George’s County
• Margaret Simms explains why trends in unemployment claims don’t necessarily line up with trends in unemployment rates.

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Why Are Older Workers Getting All the Jobs?

| Posted: April 13th, 2012

To hear the media tell it, you’d think this is the perfect time for seniors to be looking for work. Last week, just before the March employment numbers came out, USA Today trumpeted the news that 65 percent of all jobs created in February went to workers age 55 or older. That statistic is perfectly accurate—or as accurate as figures based on a household survey can be—but what does it mean? Are employers now embracing mature, experienced workers? Or, more ominously, has the financial crisis so depleted our nest eggs that no one can afford to retire anymore? Those explanations might make good copy, but neither one holds much water. Dig deeper and a more mundane explanation emerges: the number of seniors with jobs is growing because there are more older people and fewer younger people.

Let’s turn to the data. You can’t learn much about older workers from looking at a single month because the numbers are so volatile. For example, the Current Population Survey—the government household survey used to compile the official employment stats—shows that employment among Americans age 55 and older increased 277,000 in February but fell 47,000 in March. Instead, let’s consider trends over the past 12 months. And let’s ignore employment swings among those younger than 25, many of whom are in school and only marginally attached to the labor force.

What we find is that between March 2011 and March 2012, the number of employed adults age 25 or older increased by 1.9 million. Nearly five of six (1.6 million) were age 55 or older. Only 332,000 of the additional employed workers were age 25 to 54. This sounds consistent with the media’s storyline, but here’s the rub: over the same period, the number of adults age 55 and older grew by 2.8 million, while the number age 25 to 54 fell by 321,000. Simply put, over the past 12 months there were more 54-year-olds (born in 1957 or 1958, near the peak of the baby boom) turning 55 than 24-year-olds turning 25. This confirms what those of us following the workforce’s shifting demographics have been saying for years. As the population ages and the pool of younger workers shrinks, firms will increasingly turn to older workers to meet their employment needs.

Because population sizes are changing, we need to compare employment-to-population ratios to really assess how different groups are faring in the recovering labor market. Viewed through that lens, outcomes have improved somewhat over the past 12 months for adults on both sides of 55.Between March 2011 and March 2012, the share of adults employed rose by the same half a percentage point at both ages 25 to 54 and 55 and older. The employment-to-population ratio remained about the same at ages 55 to 61, increased by more than half a point at ages 62 to 64 and 70 and older, and declined by nearly a point at ages 65 to 69. All in all, younger workers seem to be sharing in the recent employment gains about as much as older workers.

Seniority still matters, so older workers are less likely than younger ones to lose their jobs. But when laid off, seniors take much longer to become reemployed. And once they find a job, it usually pays much less than their previous position. That’s the story that needs to be told today about older workers.

Employment-to-Population Ratios by Age, March 2011 and March 2012

Source: Author’s calculations from Bureau of Labor Statistics data.

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How Do You Allocate $26 Billion?

| Posted: April 12th, 2012

The $26 billion settlement between the U.S. attorneys general and five major mortgage-servicing banks has refocused attention on the still-simmering foreclosure crisis. Maryland is expected to receive $957 million, which may be hopeful news for Prince George’s County, Maryland.

In 2011, nearly 15 percent of all residences in Prince George’s—33,439 residences—received a notice of intent to foreclose (NOI) from their mortgage servicer. Of those, the median borrower was 79 days behind and owed $6,400 in loan payments, penalties, and fees. In some Prince George’s zip codes, one out of every four residences received an NOI.

It will be crucial to ensure that Prince George’s share of the settlement goes to those areas most in need. The Urban Institute’s NeighborhoodInfo DC recently expanded its foreclosure work in Prince George’s to facilitate directing assistance and resources.

For example, our interactive map displays NOI data, including the volume of notices of intent to foreclose, the amount of overdue loans, and the number of days those loans are behind. Highlight different portions of the map to show different zip codes and time periods, and zoom in to examine individual neighborhoods using Bing maps. Finally, download the data to do your own analyses.

These interactive maps are just the start of a new series of analyses and tools NeighborhoodInfo DC has planned in the coming months. Next up, the new Prince George’s section of NeighborhoodInfo DC will include a brief on the recent changes in the housing market and foreclosure crisis, with more maps and downloadable data.

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The Unemployment Picture: Reading Between The Lines

| Posted: April 10th, 2012

The unemployment figures for March, released last Friday, were higher than expected by those basing their predictions on declining unemployment insurance claims. The number of employed workers went up by only 120,000, about half what was expected, leaving the unemployment rate steady at 8.2 percent, according to the Bureau of Labor Statistics. This contrasted with predictions of job growth in the vicinity of 200,000, which many based on the previous day’s news that initial unemployment insurance claims for the last week in March had gone down. Is there a contradiction here? Not really.

While unemployment insurance (UI) claims tend to move in the same direction as the unemployment rate, they don’t necessarily move in lock step. First of all, not everyone who loses or leaves a job is eligible for unemployment compensation. Eligibility varies according to the individual worker’s prior work experience, the nature of the job separation, and the industry he or she worked in. Some of this difference can be seen in how the overall unemployment rate differs from the unemployment rate for the insured employed—those who are in jobs covered by UI. The insured unemployment rate for the third week in March was 2.6 percent, compared with the overall rate of 8.2 percent. And the relationship between the two rates can vary by state. For example, of the nine states that had the highest insured unemployment rates in mid-March, ranging from 4 to 6 percent, only three of them (California, New Jersey, and Puerto Rico) had overall unemployment rates of 9 percent or more.

Another factor accounting for the seeming paradox is the composition of the unemployed. A large portion of the unemployed are people who were not looking for work previously. Some are workers who, for various reasons, had left the labor force and are now returning. Others are people who had never worked before and are now looking for jobs. Together, they made up nearly 37 percent of the unemployed in March. In addition, over 8 percent of the unemployed are people who voluntarily left their jobs and are looking for new ones. This last group has grown over the past year. Most of the job seekers in these three groups would not be eligible for UI.

The economy is growing enough to generate some new jobs, but not fast enough to cover everyone looking for work. Some of the unemployed have been looking for work for a long time, others are returning to or just entering the job market, while still others are confident enough to voluntarily leave an old job behind and look for another one. They aren’t all eligible for unemployment insurance, so we should not be content to look at UI claims and think the hard work of job generation is behind us.

Composition of Unemployment by Reason for Unemployment, In Percent

Source:  Bureau of Labor Statistics, table A-11

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MetroTrends Week in Review

| Posted: April 7th, 2012

Last week’s MetroTrends blogs took on three hot questions from the news:

• Can a distressed public housing project be transformed (cheaply) with an architectural makeover?

• Does the relocation of public housing residents increase crime in their destination neighborhoods?

• Did stimulus funding for public sector jobs work to strengthen the economy?

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