A First Look: EIG’s Distressed Communities Index

This post is also available on the EIG website.

Today, EIG is releasing a first look at our Distressed Communities Index (DCI), a customized dataset examining economic distress spanning nearly every community throughout the country.

The DCI captures data from more than 25,000 zip codes (those with populations over 500 people). In all, it covers 99 percent — 244 million — of Americans over the age of 16.

As we found in a recent survey of likely voters in presidential swing states, a significant portion of Americans still feel like the recovery has left them behind — six years after the official end of the Great Recession. The DCI demonstrates that they don’t just feel it, they live it — over 30 million Americans to be exact — in communities defined by slow job growth, vanishing businesses, and fewer opportunities to move up the economic ladder.

One of EIG’s core values is that good data is essential for good public policy. EIG aimed to provide a simple way to identify and evaluate pockets of distress around the country, as well as to understand key factors driving that distress on a local and regional level. We wanted to provide a richer and more dynamic look at these communities than what is possible by merely relying on existing poverty and unemployment rates alone.

To accomplish this goal, EIG designed the DCI using seven metrics to assess economic well-being:

1. Educational Attainment: Percent of population 25 years and over with a high school degree.
2. Housing Vacancy Rate: Percent of habitable housing that is unoccupied.
3. Unemployment Rate: Share of the labor force that is unemployed.
4. Poverty Level: Percent of population living under the poverty line.
5. Median Income Ratio: Ratio of the zip code’s median income to the state’s median income.
6. Change In Employment: Percent change in the number of individuals employed.
7. Change in Business Establishments: Percent change in the number of businesses.

This data can be aggregated to provide rankings for cities, counties, and states. The following infographics provide a first look at our findings.

1. “The Most Economically Distressed Zip Codes in America by State and Population Density”

This graphic pinpoints the most distressed zip codes by population density in each state.

2. “Which States Have The Highest Percentage Of Population Living In Economic Distress?”

This graphic lists each states ranking by the amount of its population living in economically distressed zip codes, as defined by the bottom 15 percent.

3. “Seven Metrics Measuring Economic Well-Being Across The Country”

This graphic lists the top ten most distressed large cities by the percent of the city’s population living in distressed communities. It also lists the seven metrics used to calculate the distress index across each zip code.

In the coming weeks, we’ll develop tools to enable users to easily compare communities and dive deeper into what is driving economic distress or prosperity. You will be able to see how well your community is doing, and then compare it to others across the country. In the coming months, we’ll continue refreshing the DCI as new data is released and provide policymakers across the country with the information they need to design smart policies that unlock investment and spur entrepreneurship in communities that need it most.

Send us your feedback at info@eig.org, and please share the infographics on social media using our Twitter handle @innovateeconomy and #EIGIndex.

Thank you for your continued interest and support!

EIG brings together leading entrepreneurs, investors, economists, and policymakers from across the political spectrum to address America’s economic challenges.