Announcing the 2021 Fourth Economy Community Index!
We really are excited to share updated output from our Community Index model, which is now available on the Fourth Economy Community Index App. To that end, here are some quick notes on the whats, whys, and hows of the Fourth Economy Community Index.
Where did this come from?
For the last several years, Fourth Economy has used indicator data to measure community vibrancy and economic success. Originally, we published lists of communities that we found to be performing particularly well. Over time, as we’ve learned more about how different indicators interact, the process has become more analytically complex. In 2018, we published a tool to capture data in an app, which includes detailed scores for counties across the US.
Remind me: what is it?
Let us start with an easier question: what is it not?
High on the long list of “things the Community Index is not”, you will find the following:
A perfect model of economic success
Predictive of future events
A black box algorithm with such mathematically complex components that it can’t be understood by us meager humans
A replacement for the type of analytical work we do with clients
Still, for all the things that the Index is not, there are several reasons why we use the model and its framework as critical components in many of our projects. Simply put, the Community Index model allows us to think both quantitatively and comprehensively about key issues that guide our work, and to make robust comparisons across the country.
An equity focus
This year, we updated the Community Index model to include new and updated sources of data with a greater focus on equity. Equity focused indicators include female business ownership, disparity in business ownership by race/ethnicity, wage equity, homeownership disparity, income inequality, poverty disparity by race, and diversity index. As is the case with the broader model, no specific mix of these indicators generates an ideal or perfect score (no one recipe for an equitable community), but in general we find in our work that more diversity and more equitable economic outcomes create stronger economies and more vibrant communities, and the Community Index model now more strongly reinforces that understanding.
Importance of regional economies
Our top ten lists are filled with examples of areas that score highly. When adjacent counties score highly enough, they are combined into regions on the list. In the past we may have had only a few regions with adjacent counties that scored highly enough to be grouped together in the top 10. This year, we had seven grouped regions:
Hawaii (Honolulu, Maui, Hawaii, and Kauai Counties)
Oakland and San Francisco, CA (Alameda and San Francisco Counties)
Bethesda and Frederick, MD (Montgomery and Frederick Counties)
Bakersfield and Santa Barbara, CA (Kern and Santa Barbara Counties)
CO (Larimer and Weld Counties)
Santa Fe and Albuquerque, NM (Santa Fe, Sandoval, Los Alamos, and Taos Counties)
Casper, Cheyenne and Laramie, WY (Converse, Carbon, and Albany Counties)
These examples highlight the importance of regionalism that we’ve seen in our work to build better communities and stronger economies.
How have we changed the model this year?
We’ve updated the data, included several new data sources, and adjusted the model to better measure equitable economic vibrancy. (As with last year’s model, scores are relayed on a scale of 0 to 10 — the higher the better.)
What’s on the app?
On the app, you can review specific scores for all counties in the US with sufficient population to generate reliable results. You can also review more information available about the underlying model, including details on the specific indicators and the scores. The “Compare Scores” tab allows you to compare scores across up to ten different places. You can either select your own counties or let the app select a random county.
Going forward, we will continue to refine the app based on user input. So check out the app, and let us know what you think!