How Our Cities Impact the Future Incomes of Children
Certain cities in America are better for upward mobility
The Chart of the Week is a weekly Visual Capitalist feature on Fridays.
In the long-standing psychology debate on nature versus nurture, the question is whether it is our genes or our experiences that hold the keys to our future.
The short answer to this question, according to many of today’s scientists and psychologists, is that nature and nurture are always working together. In other words, genes do what they do depending on their context, and nature and nurture work to influence each other constantly.
In other words, our family experiences, households, and neighborhoods can set the stage for how our genes react. And on a macro level, looking at cities can tell us a lot about how our environments can help to influence future outcomes.
A Tale of Two City Types
Today’s chart pulls out some of the most compelling data from a 2015 report on intergenerational mobility.
The report studies five million families that have moved between counties in the United States, ultimately showing that there is a “childhood exposure effect” in cities that helps to predict future income levels as adults. Put another way, some cities are better than others in helping kids move “up the ladder” by accessing opportunities that later affect income. On balance, other places provide a tougher environment that makes it harder.
In this case, it should be noted that our above chart specifically deals with the city “bonuses” or “penalties”, expressed as an annual dollar amount for every year exposed to a city’s environment, on the future earnings of children in low-income families (25th percentile).
Digging into City Data
On an individual level, a person can of course succeed or fail regardless of their family or neighborhood. This happens all the time, and there are countless examples of rags-to-riches stories.
The concern highlighted by this study is that, on the whole, there is a significant disparity between cities as far as predicting future income goes. Growing up for an entire childhood in New Orleans or Los Angeles, on average, means that future income will be lower than the national median. In Salt Lake City or Boston, it’s likely to be higher than the national median.
The “bonuses” and “penalties” add up. For example, spending an entire childhood in New Orleans is estimated to lower future income to -$3,150 below the national median.
Cities in the Northeast seem to have the most mixed bag of “place effects”. New York, Philadelphia, and Buffalo have negative effects, while Boston and Washington, D.C. are both positive.
Meanwhile, the Southeast, Midwest, and Southwest all see a similar negative effect through major cities. Minneapolis and Pittsburgh are exceptions to this rule.
Finally, cities in the West appear to mostly have positive effects, with the exception of Los Angeles and Fresno (not on map).
Charted: Retirement Age by Country
We chart current and effective retirement ages for 45 countries, revealing some stark regional differences.
Charted: Retirement Age by Country
The retirement landscape can look completely different depending on what country you’re in. And charting the retirement age by country reveals a lot of differences in the the makeup of a labor force, both for economic and cultural reasons.
This graphic delves into the current and effective retirement ages across 45 nations in 2020, based on comprehensive data from the OECD 2021 report.
Defining Retirement Ages
Before we dive into the numbers, let’s clarify the measurements used by the Organisation for Economic Co-operation and Development (OECD):
- The current retirement age is the age at which individuals can retire without penalty to pension after completing a full career starting from age 22.
- The effective retirement age refers to the average age of exit from the labor force for workers aged 40 years or more.
Many countries have seen workers effectively retire earlier or later than the current retirement age. This variance can arise due to a multitude in factors including differences in career start ages, some industries offering earlier retirements or benefits for later commitments, or countries facilitating different workforce exits due to market demands and policies.
Some people also choose to retire early due to personal reasons or a lack of available work, receiving a smaller pension or in some cases forgoing it entirely. Likewise, some people choose to stay employed if they are able to find work.
Retirement Age by Country in 2020
Here’s a snapshot of the current and effective retirement ages by country in 2020:
|🇨🇷 Costa Rica||62||67||62|
|🇨🇿 Czech Republic||64||63||62|
|🇰🇷 Korea, Republic of||62||66||65|
|🇳🇿 New Zealand||65||68||66|
|🇬🇧 United Kingdom||66||64||63|
|🇺🇸 United States||66||65||N/A|
|🇪🇺 European Union (Average)||64||63||N/A|
|🇨🇳 China (People's Republic of)||60||66||61|
|🇸🇦 Saudi Arabia||47||59||N/A|
|🇿🇦 South Africa||60||60||56|
Three countries had the highest current retirement age at 67 years, Iceland, Israel, and Norway, but all had slightly lower effective retirement ages on average. On the flip side, Saudi Arabia had the lowest current retirement age at only 47 years with full pension benefits. Only Türkiye at 52 years was close, and notably both had much higher effective retirement ages on average.
Discrepancies between different regions are clear across the board. Many Asian countries including China, India, and South Korea have official minimum retirement ages in the early 60s and late 50s, but see workers stay in the workforce well into their late 60s. Meanwhile, most European countries as well as the U.S. and Canada have more workers retire earlier than minimum retirement ages on average.
Almost all of the countries with measured effective retirement ages for women also saw them exit the workforce earlier than men. This can be the result of cultural gender norms, labor force participation rates, and even the setup of pension systems in different countries.
The five exceptions in the dataset where women retired later than men? Argentina, Estonia, Finland, France, and Luxembourg.
Looking to the Future
In 2023, France sparked controversy by raising its early retirement age by two years. This decision triggered widespread strikes and riots and ignited debates about the balance between economic sustainability and individual well-being.
Given aging demographics in many developed countries and a continued need for labor, this isn’t expected to be the only country to reassess retirement. The OECD projects a two-year increase in the average effective retirement age by the mid-2060s.
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