Urban labor markets and individual transitions out of poverty

Abstract

Using data from the Panel Study of Income Dynamics and the U.S. census, I examine the effect of four structural characteristics on individual poverty exits: (1) economic restructuring, (2) skills mismatches, (3) racial residential segregation, and (4) welfare benefit levels. Results show that these factors play a role in explaining African Americans' economic disadvantages, but they have a weaker and often contrary impact on whites' poverty exits. Overall, the differing impact of the contextual characteristics on African Americans and whites exacerbates social stratification and illustrates racial divisions that continue to pervade the labor market.