Is Political Division Reducing Labor Mobility?

In the face of the unrelenting march of technology, a common argument is that labor market mobility is essential to help people combat the risk of disruption to their livelihood. While considerable time and attention has been given to the topic of occupational mobility, and the challenges inherent in retraining people, perhaps less attention has been given over to geographical mobility.

It’s one of the key weapons espoused by Oxford University’s Carl Benedikt Frey in his latest book The Technology Trap. In it, he argues the case for what he refers to as ‘mobility vouchers’ to help facilitate the movement of people to more prosperous regions.

“Historically, migration was the mechanism by which cities adjusted to trade and technology shocks,” he writes. “Workers moved to areas where new industries created an abundance of well-paying, semiskilled manufacturing jobs.”

This migratory flow has become gummed up however, with the unskilled now increasingly less likely to move. Frey argues that mobility vouchers could help to cover the costs of moving to a new region, and effectively subsidize this relocation.

Ideological barriers

While there is undoubtedly a logic to this argument, a recent study from Penn State reminds us that there is more than simply money at play in the reluctance of people to move.

The last few years has seen a clear divide emerge between the politics of big cities, and those of rural regions, and the study suggests that this ideological divide may be discouraging many people from making the rural-urban migration.

The researchers examined migration patterns from county-to-county across the United States, and discovered that when people moved, they tended to move to other areas that shared their political ideology. For instance, people who live in a politically extreme county were significantly more likely to move to a similarly extreme county than they were to a more moderate county.

“We found that the places that were most likely to exhibit same-party preference in movement are counties that are politically extreme,” the researchers explain. “What we saw was that movement from very Democratic or very Republican counties tended to be isolated to migration to other counties that are politically similar.”

Indeed, the authors believe that these migratory patterns could be a major factor in the apparent geographic polarization that is unfolding both in the United States and other developed countries around the world.

“It’s a geographic form of polarization,” the researchers explain. “It’s a phenomenon that political scientists refer to as the ‘hollowing out of the political center.’ Forty years ago, you could find many moderate Democrats and moderate Republicans in Congress. You don’t find that now — and we’re also seeing this dynamic in these migration patterns.”

Of course, the political orientation of a place is not the only factor at play when we decide to move or not, with the availability of jobs still a considerable factor. Indeed, this is something the researchers themselves concede, and admit that economic factors remain the largest single thing that influences our decision to move somewhere or not.

The point is however, that for some people it’s less a case of choosing to move to a bigger city from their rural town for work as not moving at all, and the fact that the big city is likely to have a very different culture to their existing community does play a part.

On the move

While there is perhaps not much that can be done about the ideological divide emerging between our rural and urban communities, policy makers can still work to improve infrastructure links that support the mobility of labor.

New research from the London School of Economics looks at this in the UK via something known as the Travel To Work Area (TTWA), which is a statistical tool used by UK Government agencies and local authorities to indicate an area where the population would generally commute to a larger town, city or conurbation for the purposes of employment. The analysis shows a clear north-south divide within the UK, with cities such as Oxford, Cambridge and Bristol scoring much higher than Newcastle, Liverpool and Glasgow.

The researchers argue that overcoming this discrepancy can be done in large part due to commuting, as just as an unemployed miner from South Wales could move to Cardiff for work, if transport links are good, they could also commute there for work. The research counters the notion made famous by Norman Tebbit that the disparities exist because the decline of manufacturing industries across Britain coincided with an immobile labor force.

Responses to change

Whilst the authors are at pains to point out that the responses are not immediate, they do nonetheless identify clear population responses to changes in economic opportunity. Indeed, they find that local shocks are often followed by large inflows of commuters from elsewhere, with this change in commuting patterns often sufficient to eliminate the impact of that local shock within a couple of decades.

The success of these responses are by no means consistent however, as areas experiencing weak employment growth in the 70s and 80s still appear to do so today. It creates a kind of race between jobs and population, as the changes in population struggles to keep up with the rate of job losses locally. As such, despite population movement, the employment rate in the area remains low.

What’s more, the challenges faced by one town are likely to be replicated by neighboring towns, which when the cost of commuting is factored in can make escaping this ‘dead zone’ difficult. Indeed, the data suggests that people are more likely to move house within these areas than they are to commute longer distances in the search for work.

So while workers do appear to attempt to mitigate local job losses by both migration and new commuting patterns, the effectiveness of these responses can be limited. Given this context, the authors believe that if policy makers could reduce the cost of commuting by 10%, it would change employment disparities between regions by just 4%. If they encouraged migratory responses by a similar percentage however, they believe it would reduce those disparities by up to 24%.

It perhaps goes without saying that a 10% increase in mobility is quite hard to achieve, but the findings should be read to support a greater investment in transport infrastructure to allow people the potential of a longer commute. By simply working in a city rather than living there, this may also overcome some of the ideological barriers that prevent people from moving to where jobs are more plentiful.