Chetty talks in Charlotte: How labor market improves all childrens' chances of upward mobility

Raj Chetty, the economist behind the national study that once ranked Charlotte 50th for upward mobility, says his research group has found that an area's employment rate correlates to children's chances of future success.

Why it matters: Presenting his data to a Charlotte audience on Friday, Chetty said that a deeper dive into the research reveals that a child's parents' employment status is less an indicator of their future success than the overall employment health of the surrounding community.

• "The key unit of change seems to be the community rather than the individual family," Chetty said. "It's not so much whether literally your own parents are employed or not. If you're growing up in a community where lots of other people are losing their jobs, for some reason that seems to limit your own prospects of rising up."

The big picture: Chetty's findings give a clearer idea of how Charlotte can strategize and continue improving its economic mobility standing in the future.

Catch up quick: Chetty's bombshell 2014 study found children born in Charlotte had the worst chance of rising out of poverty than any other metro in the country. However, a study released this summer said that Charlotte is now 38th out of 50.

Zoom out: Charlotte made the third-most progress among the 50 metros in Chetty's research.

• "[Charlotte]'s still not at the top of the list, and we wouldn't expect over a decade and a half that you can completely change. But to me, it's a remarkable amount of change," Chetty said. "Some of the inequities we're talking about here, you can trace them back 150 years to things like slavery and Jim Crow laws."
• The two studies tracked people born in 1978 and 1992 and examined their income in adulthood at 27 years old.
• The Gen X cohort likely benefited from the city's growth in the '80s and '90s, as companies like Bank of America were creating jobs here.

Zoom in: When unemployment is high in a community, the adults aren't contributing financially to their schools or local programs. They also aren't interacting as much with each other, or breaking through class or race barriers.

• Chetty's research group Opportunity Insights also tracked interactions between low- and high-income people on Facebook. It found areas with the highest level of connections had the greatest levels of economic mobility.
• "Growing up in a community where people are not working, where there are less resources, where there are less connections, maybe that's affecting kids' long-term outcomes," Chetty said.

What they're saying: Speaking on a panel afterward, former chairman and CEO of Bank of America Hugh McColl described how we need to help each other and interact with people who don't look like us.

• "Money is not our issue," McColl said. "It's really helping people climb the mountain."

The bottom line: Charlotte has invested millions of dollars into improving its economic mobility. But one solution to the city's economic mobility problem is free.