Inaugural Community Survey Elicits Respondents’ Top Concerns in the District
This inaugural report captures the top concerns of the Community Survey’s respondents in the Fourth Federal Reserve District. The survey will be conducted twice annually and the results will be used to enhance our understanding of the issues, both current and upcoming, that are facing our District.
Current Issues
What did respondents rank as their top current concerns about the communities they serve?
1 - Availability of local employment opportunities
Given the current economic conditions, it is not surprising that more than half (51 percent) of the respondents ranked “availability of local employment opportunities” as one of their top three concerns. Just over a quarter (26 percent) named it their number one concern. In the Fourth District state of Kentucky, for example, the unemployment rate has remained higher than the national average since the last recession (see Figure 1). Comments about employment opportunities revolved around three themes: the skill set of job seekers, the types of jobs available, and the negative consequences of unemployment and job loss.Several respondents pointed to the mismatch between the skills of job seekers and the jobs available. They noted two discrete disconnects: the lack of skilled labor and the lack of high–skilled jobs. One economic development professional stated that “skill gaps are emerging between the employers’ needs and what the workforce can supply.” A respondent from a Community Development Financial Institution (CDFI) wrote that the high unemployment in the region was due to two factors, “deplorable graduation rates and educational attainment rates… so the workforce is not ready for hire.” A respondent from a financial association stated that “for Ohio to be competitive economically, it must have a well–educated workforce—not just K–12, but technical and higher education as well.”
A number commented on the lack of jobs that pay living wages. “We are lacking in jobs that provide wages that will support families,” wrote a respondent from a local government. “The part–time and seasonal employment available does not have benefits that are needed.” Several noted that the loss of college graduates and skilled workers from our region is the result of limited opportunities for higher–skilled, higher–paying jobs. Without jobs, a number of respondents reported, foreclosures will continue to increase, tax revenues will continue to decline, and communities will continue to struggle to meet their needs.
“Skill gaps are emerging between the employers’ needs and what the workforce can supply.” —Economic development professional
Figure 1: Unemployment Rates and Recessions
Prepared by the Federal Reserve Bank of Cleveland's Community Development team
Source: Bureau of Labor and Statistics/Haver Analytics
2 - Vacant properties
With vacancy rates increasing across our District, survey respondents ranked vacant and abandoned properties as the top concern after employment (see Figure 2). About 33 percent ranked vacancy among their top three concerns, with 15 percent listing it as their number one concern. The dominant theme that emerged from respondents’ comments was that vacant and abandoned properties continue to cause costly consequences—so–called negative spillover effects—that communities must address, including increased crime, reduced property values, and an inability to attract investment. A respondent from a CFDI put it this way: “There is no greater threat to a community [than vacant property], impacting safety, livability, property values and the health of a neighborhood.”
Another theme that emerged in the responses was the lack of sufficient resources to deal with the magnitude of the problem. “We have long suffered from vacant and abandoned property, and we have strategies to try and deal with these properties,” observed a community development professional. “But the continued funding cuts at the state and federal levels are eliminating our options for addressing these properties for productive re–use.”
Figure 2: Vacancy Rate Comparison, 2000 - 2010
Prepared by the Federal Reserve Bank of Cleveland's Community Development team
Source: U.S. Census Bureau
3 - Budgetary cuts and financing issues at the state level
Budget cuts ranked third, with about 30 percent of survey respondents ranking cuts and financing issues at the state level as one of their top three concerns, followed by 26 percent who picked budget cuts at the federal level. According to the Center on Budget and Policy Priorities, the Great Recession “brought about the largest collapse in state revenues on record.”2 As a result, tax revenues are down while demand for state–funded services is on the rise (see Figure 3). Most respondents’ comments revolved around the impact state and federal cuts will have on the lower–income and more vulnerable populations during a challenging economic period. “Whole programs have been eliminated,” said a respondent from a community development organization. “Already needy families and individuals have no where left to turn.”
Figure 3: Fiscal Year 2011 State Budget Shortfalls
Prepared by the Federal Reserve Bank of Cleveland's Community Development team
Source: Center for Budget and Policy Priorities
A respondent from a nonprofit law firm wrote that “funding for social support programs is a popular target in the budget deficit discussion, despite record levels of poverty and food insecurity.” An economic development professional cautioned that cuts to human services will create higher social costs over time. Reductions in funding for CDBG, HOME, and other programs related to affordable housing and neighborhood revitalization were raised by several respondents concerned about federal budget cuts. Capacity and viability of local nonprofits will also be affected by budget cuts at all levels. “CDCs are a critical component in assisting struggling communities,” noted a respondent from a CDFI. Added a housing counseling agency professional, “Demand for nonprofit services is at an all–time high, while funding is at its lowest. This is a recipe for disaster.”
Though access to quality K–12 education was not ranked among the top three issues, education was clearly on the minds of respondents concerned about budgets cuts at all levels of government. A survey respondent from an organization focused on school improvement wrote that “state budget shortfalls are being borne on the backs of our most vulnerable students in our poorest school districts.” This same respondent continued, “School districts are being forced to make drastic cuts in programs and services that serve children because of state budget cuts.”
However, there were some who said funding was not the issue: “Over 70 percent of Kentucky high school graduates need basic remediation in math and English should they enter community colleges or four–year institutions,” wrote a respondent from a CDFI. “Entrenched acceptance that improvements are being made against ever declining standards is deplorable and negatively affects the general population’s ability to provide for itself while increasing economic opportunity for its progeny.” This respondent continued, “About 50 percent of all Kentucky tax revenue goes to support public education, most of it K–12. More money is not the answer.”
Emerging Issues
What did respondents rank as their probable top concerns a year from now?
- Budgetary cuts and financing at the federal level
- Local employment opportunities
- Budget cuts at the state level
In terms of issues that will have the greatest impact on the welfare of communities a year from now, budgetary cuts and financing issues at the federal level ranked among the top three for nearly 37 percent of respondents, followed by local employment opportunities (32 percent) and budget cuts at the state level (31 percent). Many respondents expressed concern about the political climate in Washington, DC, and how the uncertain and partisan climate will impact federal funding decisions.
Comments on federal budget cuts focused mainly on the ripple effect these cuts have on state and local government budgets and programs. “State and local governments depend on federal programs,” wrote a respondent from a federal agency. “When federal budgets are cut, those (state and local) governments cut their workforce and have less funds to stabilize or improve distressed neighborhoods.” A respondent from a community development intermediary commented that “federal budgets cuts across dozens of community development line items and take away needed and proven tools during a time of dire need.” A respondent from a local government put in more bluntly: “Federal budgets cuts will cripple our operations.”
Local employment opportunities remained a top future concern for many respondents. Several put employment at the center of community improvement. “No jobs…no income, no credit, no housing,” commented a West Virginia banker. A respondent from a state agency in Ohio wrote, “More employment will reduce the other problems on the list.” Many respondents expressed concern about the continued high rates of unemployment and low numbers of new jobs. “There is no apparent job growth to replace the elimination of public–sector and service–sector jobs lost because of budget shortfalls,” noted a professor.
“New business and jobs must be at the top of every list,” wrote a respondent from a foundation. “Suitable business development for small and rural communities is critical for this region, and appropriate tactics must be employed to address this issue. Entrepreneurship, rural business development (including farming), small–scale manufacturing, alternative energy, traditional energy, tourism, food, and technology–based businesses must be developed from within to stabilize and grow these communities.”
State budgets cuts were also a top concern among respondents asked to think about issues impacting communities a year from now. Nearly all of the comments focused on the impacts state budget cuts will have on communities. A community development banker summed it thus: “Neighborhood revitalization, schools, consumer finance, public transportation, and human services all rely on state funding. The lack of resources and change in politics cause me grave concern about how we will address those needs going forward.”
Other Respondents' Comments
Respondents also offered insights on topics ranging from the interconnectedness of key issues to root causes and the role of the community development industry going forward. For example, job loss could lead to more foreclosures, which could lead to more vacancy and increased reliance on social services, which could be impacted by budget cuts.
“How much systematic pressure can the U.S. economy handle from rising social service requests due to loss of jobs and rising costs, taxes, food and fuel prices? If we haven’t figured it out yet, lower interest rates are not the answer.” — CRA officer in Pennsylvania
“Job development does not target employment opportunities. For example, we cannot find candidates with a CDL to operate buses and equipment. Unrealistic training leads to dependency on an already overburdened social services system.” — County government official in Kentucky
“CDCs need to rethink their traditional role as housing developers and be more about connecting residents to jobs, education, and services that will help them improve their lives.” — Researcher in Ohio
“Reduction in services of core city governments will make the core cities less competitive in attracting business investment from new or existing businesses.” — Foundation program director in Ohio
“All higher–level budgetary cuts filter down to the local level, affecting various aspects of the community—infrastructure, schools, and community development.” — Bank president in Ohio
“We have a huge deficit of quality, affordable housing. Lack of stable, safe housing is a barrier to employment.” — Researcher in Ohio
“Small business is the backbone of our local community and without financing cannot grow. Job retention becomes more difficult and job creation does not occur.” — Economic development professional in Pennsylvania
“It is imperative that community development and economic development be linked and executed in an integrated fashion with workforce development.” — Foundation program officer in Ohio
“The root issue impacting community development for now and far into the future is not housing foreclosures, lack of credit, affordable housing, or budget cuts at all levels of government—it's education. Education…helps LMI families help themselves for the rest of their lives. The community development field needs to direct its main focus [away from housing] to education.” —Federal agency respondent
“The slashing of local, state, and federal budgets requires meaningful partnerships between financial institutions, governmental jurisdictions, social service providers, educators, and businesses in a more hands–on way than ever before.” — Local government program director in Ohio
“The community development industry will need to become more adept at partnering and working closer together to combat these challenges—CDCs, local governments, private sector, and philanthropy. We need to make the case as to how CD programs deliver results and return on investment.” — Community development professional in Ohio
Survey Methodology
The Federal Reserve Bank of Cleveland developed this survey to elicit perspectives from stakeholders on key issues facing the communities and individuals they serve. We sent an online survey in August and September 2011 to approximately 540 individuals working in organizations throughout the Fourth District; 144 completed the survey. Below is a breakdown of the types of organizations that provided responses to our survey and in which states the organizations were located. Please note that the responses reflect only the perspectives of those responding to the survey and not all the organizations within our District.
| Local government | 22 | 15.3% |
| Community bank | 21 | 14.6% |
| Community development organizations | 21 | 14.6% |
| Social service/health/education organizations | 14 | 9.7% |
| Academic or policy center | 12 | 8.3% |
| Community development financial institution (CDFI) | 11 | 7.6% |
| Foundation | 8 | 5.6% |
| Economic development organization | 7 | 4.9% |
| Other | 7 | 4.9% |
| National bank | 5 | 3.5% |
| Legal practice/court | 4 | 2.8% |
| State government | 4 | 2.8% |
| Federal government | 3 | 2.1% |
| Housing counseling agency | 3 | 2.1% |
| Credit union | 2 | 1.4% |
Total |
144 |
100.0% |
| 2010 population in District | Survey response | |
| Ohio | 68.1% | 65.3% |
| Pennsylvania | 19.6% | 20.8% |
| Kentucky | 11.3% | 8.3% |
| West Virginia | .9% | 5.6% |
Total |
100.0% |
100.0% |
Footnotes
- The Fourth Federal Reserve District comprises all of Ohio, the western third of Pennsylvania, eastern Kentucky, and the panhandle of West Virginia. See the methodology section at the end of this report for a breakdown of the types of organizations that responded to the survey.
- “States Continue to Feel Recession’s Impact,” Center on Budget and Policy Priorities. http://www.cbpp.org/research/states-continue-to-feel-recessions-impact?fa=view&id=711
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