Baton Rouge struggling with inclusive economic growth

    Inclusive economic growth—both in the short- and long-term, has evaded Baton Rouge, according to a recent Brookings Institute report, but a similar story is playing out elsewhere across America.

    Economic success was measured by a few token indicators: growth trends, prosperity, and inclusion (including by race) for the 100 largest U.S. metro areas, both in 2017 and across a 10-year period. Metros considered “best-performing” were scored anywhere from 1-20, while those considered “worst-performing” were scored in the 81-to-100 range. Baton Rouge was behind most metros for all indicators in 2017, reporting scores of 77 for growth, 78 for prosperity, 77 for inclusion and 82 for inclusion by race. That’s compared to 10-year scores of 34, 26, 72 and 77, respectively.

    Nationally, growth was widespread in 2017, but entrepreneurship declined over the decade. Baton Rouge saw slightly positive growth in 2017, increasing jobs (0.1%), GMP (0.6%) and jobs at “young,” or five-year-old, private sector firms—an indicator of entrepreneurship (8.3%). Between 2007 and 2017, however, local entrepreneurship declined 5.1%.

    Prosperity in Baton Rouge also rose in 2017. The region saw upticks of 0.5% in productivity and 0.8% in standard of living, but no change in average annual wage.

    However, unlike most places, where standards of living remain below 2007 levels, Baton Rouge’s standard of living has risen 3.8% over the past 10 years.

    Most metro areas grew more inclusive in 2017, but earnings in many have yet to reach pre-recession levels. Locally, median earnings grew (0.7%), as did the employment rate (1%)…but so did relative poverty (3.6%).

    Indeed, the income gap has widened in Baton Rouge over the past decade, with relative poverty up 5.2% and median annual earnings also up 6.7%. The metro area has also seen a net 1.9% decrease in employment since 2007.

    Metro areas made some progress on racial inclusion in 2017, but very little overall since 2007. In Baton Rouge, the 2017 median earnings gap between white people and people of color—though still separated by roughly $20,000—dropped $361, while the relative poverty gap between white people and people of color also narrowed by 1.3 percentage points. The employment rate gap that year, however, widened by 4.1 percentage points.

    Still, it’s better than the local trend over the last decade, which saw people of color earning a median $1,815 less than white people and the relative poverty gap widen (2.6%). On a positive note, the employment rate gap has dropped 1.2% since 2007.

    Read the full report.

    View Comments