Free exchange: The geography of joblessness

IN THE OECD, a club mostly of rich countries, nearly 45m people are unemployed. Of these, 16m have been seeking work for over a year. Many put this apparently intractable scourge down to workers’ inadequate skills or overgenerous welfare states. But might geography also play a role?In a paper* published in 1965, John Kain, an economist at Harvard University, proposed what came to be known as the “spatial-mismatch hypothesis”. Kain had noticed that while the unemployment rate in America as a whole was below 5%, it was 40% in many black, inner-city communities. He suggested that high and persistent urban joblessness was due to a movement of jobs away from the inner city, coupled with the inability of those living there to move closer to the places where jobs had gone, due to racial discrimination in housing. Employers might also discriminate against those that came from “bad” neighbourhoods. As a result, finding work was tough for many inner-city types, especially if public transport was poor and they did not own a car.For the past 50 years, urban economists have argued over Kain’s theory. Some, like William Julius Wilson, then of Chicago University, pointed...



from The Economist: Finance and economics http://www.economist.com/news/finance-and-economics/21627628-difficulty-people-have-getting-jobs-makes-unemployment-unnecessarily?fsrc=rss|fec