If you’ve paid any attention to the endless self-promotion of the State of Texas in the Perry Era as a paradise for “job-creators” and thus, very derivatively, a good place to look for economic opportunity, you are probably at least generally aware of various assessments published or sponsored by the job-creator community that give a big thumbs up to places that don’t much cotton to taxes and public services and all those other inconveniences to the corporate bottom line. Publications with names like Chief Executive and Site Selection are unsurprisingly interested in jurisdictions that proudly advertise their groveling abasement to potential “investors,” but somewhat more credible sources like CNBC lean heavily in the same direction with a view of the economic development process as purely a matter of making companies with happy feet happier still.
But as Anne Kim notes in her article for the November/December Washington Monthly cover package, there are better measurements of opportunity available that focus on entire populations rather than their presumed plutocratic benefactors:
Two years ago, Opportunity Nation, a Boston-based nonprofit, launched the Opportunity Index in partnership with the research group Measure of America. This index is an effort to shift the national conversation around opportunity and to redefine what “opportunity” means—not just in general, but in terms of who benefits. Their measure challenges the business-centered rankings of state opportunity and growth that now dominate the popular press. Their focus is on people—in particular, young people aged sixteen to twenty-four, who are finding opportunities much more difficult to come by today.
The Opportunity Index ranks states based on sixteen indicators that Measure of America codirector Kristen Lewis says are essential to the “infrastructure of opportunity” for individuals. These indicators include not just the basics—the availability of jobs, affordable housing, and quality education—but also what a growing body of research shows is critical to upward mobility: social capital and civic life. These factors make up, at the individual level, the equivalent of the “business-friendly” environment that company-focused rankings measure.
The outcomes under the Opportunity Index approach, needless to say, are radically different from those of CNBC. Under the 2013 Opportunity Index, Texas—top ranked in opportunities for business by CNBC—ranks thirty-eighth in opportunities for people. Meanwhile, Vermont, which invests nearly double what Texas does per pupil in K-12 education ($15,096 versus $8,562), ranks first on the Opportunity Index and thirty-second by CNBC. On the other hand, some states, such as North Dakota, South Dakota, and Nebraska, manage to do right by both their businesses and their people. These three states rank in the top ten under both the Opportunity Index and CNBC, which means that creating opportunity for companies and creating it for individuals are not mutually exclusive propositions. Indeed, the best outcome of all is opportunity for individuals, broadly shared, along with robust economic growth and innovation.
The states that do best on the Opportunity Index are the states that have made investing in their people a top priority, with good schools and early childhood education, real efforts to help young people find jobs when they graduate or to keep them from dropping out, and a commitment to improving opportunity for all. Perhaps because of its investments in K-12 education, Vermont has the highest on-time high school graduation rate in the country, and more than 91 percent of its students leave school with a diploma.
It really produces a bit of a Copernican Revolution when you stop viewing a particular state or city’s economic well-being from the perspective of raptors wheeling above the landscape looking exclusively for places with low business costs. Do check out Anne’s article and the 2013 Opportunity Index itself.