Job Proximity and the Urban Employment Problem: Do Suitable Nearby Jobs Improve Neighbourhood Employment Rates?

Abstract

Due to a scarcity of small-area jobs data, much of the spatial mismatch literature has not directly addressed the impact of nearby jobs on neighbourhood employment rates. Such analysis is particularly needed when considering the probable effects of neighbourhood-targeted economic development. Moreover, the occupational mix of jobs and their match with resident skills have not been dealt with adequately. A consistent measure of job proximity is found to have a significant but modest effect on neighbourhood employment and unemployment rates, with a standard deviation increase resulting in an increase in the employment rate of approximately six-tenths of a percentage point and a reduction in unemployment of approximately three-tenths of a percentage point. When considering occupational match and the average occupational level of nearby jobs, the effect of nearby jobs is larger. Race and educational attainment are found to have the largest effects on employment rates.