Measuring Labor Market Similarities in Nearby Regions
Labor market conditions are similar in regions that are near each other, known as positive spatial correlation.
Analyzing county-level data from 1990 to 2024 shows that commuting flows may contribute to strong spatial correlation in employment growth.
Spatial correlation appears to have strengthened since the 1990s, at the same time as more workers were commuting across county lines.
Regions that are geographically close are much more likely to share similar economic conditions than regions that are farther apart.
As these connections grow through commuting flows, both favorable and challenging conditions in local economies may become more likely to spread farther than in the past.
Author's summary: Labor market conditions are similar in nearby regions.
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