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What Lowell, Massachusetts, Can Teach the Rest of America About Economic Inclusivity

Lowell, Massachusetts, is well-known for successfully navigating a number of economic reincarnations. Lowell, which straddles the Merrimack River and is roughly 30 miles northeast of Boston, had a booming textile industry during most of the 1800s and the first half of the 1900s. Lowell stood as a brilliant example of urbanization, with its five-story mills flanking the Merrimack and complex canal system; Massachusetts Governor Edward Everett famously stated that the city’s rise “looks more the work of magic than the usual course of human action.”

Following the demise of the city’s textile sector after WWII, Lowell remade itself as a regional technological center, home to (most famously) Wang Laboratories. However, following Wang’s bankruptcy in 1992, Lowell set about resurrecting itself, converting its ancient textile mills and abandoned Wang buildings into affordable housing and corporate office space. The Lowell Development and Financial Corporation (LDFC) provided low-interest loans to local company owners, many of whom were immigrants and refugees. City officials also worked hard to invest in and exploit the assets of Lowell’s large Cambodian refugee population, giving ESL lessons, technical help to non-profits serving the community, and promoting the establishment of events like the Southeast Asian Water Festival.

Lowell not only recovered economically as a consequence of these programs, but it also grew more ethnically and economically inclusive as a result of them. Residential segregation, the fraction of the population classed as rent-burdened, and racial house ownership and education inequalities all decreased between 1990 and 2000.

Lowell’s record of racially and economically inclusive development and recovery contrasts sharply with the national narrative following the Great Recession. The recovery in the United States has been gradual and uneven—some cities have recovered swiftly, while others are still struggling. It’s also been characterized by wage stagnation. The combination of a growing cost of living and wage stagnation has created significant economic constraints for all but the wealthiest people in many of the places that recovered the fastest—for example, New York and San Francisco. This paradox begs the issue of whether economic recovery and increased inclusion can coexist.

The Urban Institute, a nonpartisan think organization, has released an interesting new paper and data tool that addresses this subject. The analysis examines both economic and racial inclusion in 274 locations across the country, indicating which cities are the most and least inclusive.

The researchers also utilized a new data set to look at historical economic recoveries (dating back to 1980) and identified places that improved their racial and economic inclusion while doing so. According to Erika Poethig, an Urban Institute researcher and co-author of the paper, the objective is to encourage leaders to see economic recovery as an opportunity for needed reform. During the Obama administration, Poethig also worked as an acting assistant secretary at the Department of Housing and Urban Development.

“The research was particularly driven by the concept of being hopeful about today’s more disadvantaged locations,” adds Poethig. “And envisioning that, as we work our way through this recovery, we can make deliberate decisions to increase economic and racial inclusiveness.”

Poethig and her colleagues used case studies of Lowell and three other cities—Columbus, Ohio; Louisville, Kentucky; and Midland, Texas—to identify eight common characteristics of inclusive economic recoveries: the adoption of a shared vision, bold public leadership, cross-sector partnerships, a process that builds voice and power even for historically marginalized communities, the identification and leveraging of existing assets, a regional mindset, and the reframing of the economy.

Investing in priorities such as affordable housing, education and training, and community development, in other words, can really help the economy recover.

“There’s no doubt that when resources are limited, these might be paradoxical judgments,” Poethig adds. “However, one of your most valuable assets is the human capital that resides in your city—investing in your city’s varied populations may help drive economic progress.”

Many officials in the United States, both at the national and municipal levels, have thus far ignored this view.