Income and Employment | Poverty and Opportunities

The goal of this research is to identify business opportunities in poor areas in Southern California by: (1) mapping areas of poverty; (2) evaluating how available and accessible key services and businesses are to poor areas; and (3) defining gaps in services as opportunities for businesses to better serve people in poverty.

In recent years, private organizations have taken a more active role in engaging themselves for world good. This has come under the broad umbrella of Corporate Social Responsibility (CSR). CSR activities range from activities that are purely philanthropic to organizations engaging profitability in socially important activities. Between these two extremes are various opportunities for businesses to contribute in ways that are mutually beneficial – such as providing products and services to the poor, partnering with the poor at various points in their value chain, and employing people in poverty.

Lower income families have the same needs as the more affluent – they need easy access to grocery and retail stores, health care, transport, communication, education, entertainment, libraries, banking etc. However various reports suggest that many organizations do not offer their products and services in poorer neighborhoods, allowing those that do, to charge higher prices or provide poorer service. A 2006 report from the Brookings Institute on Poverty and Opportunity observed that in general lower income families tend to pay more for the exact same consumer product than families with higher incomes. They estimate that reducing such costs by just one percent would add over $6.5 billion in new spending power for these families.

Taking a spatial approach, we started by mapping areas of poverty and the location of key services, such as grocery stores and banks, with data from the Census and ESRI’s Business Analyst GIS product. In each case, we ask the question, are there differences in services provided to areas of poverty vs. other areas? Initial analysis shows some interesting trends, such as the fact that poorer areas have more small-scale grocery markets and fewer large grocery chain stores. Future analysis will evaluate other kinds of services and use GIS to identify specific areas of need/opportunity for businesses.

We will also explore whether there are differences in employment and educational opportunities available to people living in low income neighborhoods.