Geographical Labor Mobility

What is Geographical Labor Mobility?

Geographical labor mobility refers to the level of flexibility and freedom that workers have to move from one region or locale to another in order to find gainful employment in their field.

Key Takeaways

  • Geographic labor mobility refers to the ability of workers within a specific economy to relocate in order to find new or better employment.
  • Workers' mobility is determined by several factors, from transportation options to standards of living and other government-related policies.
  • The rate of geographic labor mobility within the United States has been consistently declining since the 1980s.
  • Greater labor mobility is often associated with higher productivity and eocnomic output.

Understanding Geographical Labor Mobility

Geographic labor mobility refers to the ability of workers within a specific economy to relocate to find new or better employment. It can be compared to occupational labor mobility, which is workers' ability to change jobs or professions irrespective of geographical location. Geographical labor mobility can also be related to capital mobility or the mobility of economic goods.

There are several determinants of geographic labor mobility. The ease of movement and migration and the economic incentives to relocate are the main determinants of an economy’s fluidity of geographic labor mobility. Physical, geographic, and political barriers to movement are key factors that can make moving more difficult. At the economic level, a region's size, distance, and aggregate job opportunities determine the geographic labor mobility. At the personal level, however, determinants of the individual’s specific personal circumstances, such as family situation, housing issues, local infrastructure, and individual education affect geographic labor mobility. An economy's level of trade is also a direct factor in the geographic labor mobility of its workforce. For example, increasing the level of domestic and international trade requires that offices and other institutions be opened in various parts of a country, increasing job opportunities in these locations.

Other Elements That Affect Geographic Mobility

In addition to the major root factors, there are other, specific key factors that can make geographic labor mobility more or less available. First, the aggregate level of education influences the mobility of the labor force, with a higher education generally resulting in greater ability to move in order to find employment.

Personal and cultural attitudes also drive labor mobility. For example, if an individual employee has no motivation to seek employment elsewhere, they will not, which results in low geographic labor mobility. Agricultural developments can also affect labor mobility as they drive people from densely populated areas to less-densely populated areas during busy seasonal periods.

Another key determinant is industrialization. Highly industrialized economies provide more blue collar job opportunities, which increases the labor mobility of the economy. More specifically, an industrialized economy helps workers move from rural locations to larger cities where there are more job opportunities.

Government policies can also heavily influence geographic labor mobility. In global economic terms, the European Union actively tries to increase the geographic labor mobility of individuals by helping qualified workers find employment in other countries and cross national borders to spur individual, corporate, and national economic growth. If a government wants to increase geographic labor mobility, there are several actions it can take. The country can support transportation options, help raise the standard of living, and advance government policies that help with mobility within an economy.

One negative result of geographic labor mobility is the brain drain, or human capital flight, from developing regions and nations.

Pros and Cons of Geographic Labor Mobility

Geographic labor mobility provides several benefits to a nation's economy. Chief among them is better allocation of the supply of labor and productivity. When workers can move to where the jobs are, more workers find employment and businesses can obtain the labor they need, where they need it. An economic study published in The Yale Law Journal in 2017 points out that geographic labor mobility makes managing macroeconomic stability easier and that local barriers to mobility can make macroeconomic policy less effective.

On the other hand, while geographic labor mobility is promoted as an ideal situation in blackboard economic models, it also has its downside. Labor mobility is associated with the dissolution of local communities and extinction of indigenous cultures as members migrate to seek economic opportunities and resettle in areas in which they are culturally alien. This tends to erode social capital in both the locations that workers leave and in new areas they move into. Geographic labor mobility is also the direct cause of the brain drain, or human capital flight, from developing regions and nations.

Geographic Labor Mobility In the United States

The United States presents an interesting case study of geographic labor mobility during and after the development of economic systems.

When the country was expanding westward and new industries were being developed, geographic labor mobility was at its peak as new migrants and the existing population moved to places with economic promise. However, the rate of moving has declined consistently since the 1980s. According to U.S. Census data, the rate of movement between states has fallen by nearly half since 1989 while the rate of mobility between counties has declined by almost a third. Indeed, even during the COVID19 pandemic, labor mobility trends continued in the U.S., with just 8.4% of people living in a different residence one year ago in 2021, down from 9.3% in 2020.

What Is Occupational Labor Mobility?

Occupational labor mobility is how easily workers are able to switch jobs, often involving a new occupation or career path. Different from geographical labor mobility, occupational mobility does not have to involve people moving from one place to another.

Why Is Labor Mobility Important?

Increased labor mobility is generally thought to be a positive for the economy. More freedom to move tends to result in more productive and satisfied workers, lower unemployment, and rising GDP.

Why Is Cross-Broder Labor Mobility Controversial?

Opening up borders and encouraging geographic mobility for migrant workers is often a point of controversy. Critics claim that these lower-paid workers effectively steal jobs from exiting citizens and can lead, in extreme cases, to the overpopulation of certain areas, putting a strain on public services and pushing up the local cost of living. This can then fuel hatred and spur social unrest. Economists, on the other hand, often argue that migrant workers take low-paying, low-skilled work that nobody else wants or whom would require higher wages. A growing population also usually corresponds with economic growth and prosperity.

Article Sources
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  1. European Commission. "Annual Report on Intra-EU Labour Mobility 2020."

  2. David Schleicher. "Stuck! The Law and Economics of Residential Stagnation." Yale Law Journal, 2017.

  3. Faist, Thomas. The transnationalized social question: Migration and the politics of social inequalities in the twenty-first century. Oxford University Press, 2018.

  4. Cohen, Jeffrey H., and Ibrahim Sirkeci. Cultures of migration: The global nature of contemporary mobility. University of Texas Press, 2011.

  5. Bongers, Anelí, Carmen Díaz-Roldán, and José L. Torres. "Brain Drain or Brain Gain? International labor mobility and human capital formation." The Journal of International Trade & Economic Development, Vol. 31, No. 5. 2022. Pp. 647-671.

  6. Organisation for Economic Co-operation and Development (OECD). "The Decline in Labour Mobility in the United States: Insights from New Administrative Data," Page 31.

  7. U.S. Census Bureau. "Pandemic Did Not Disrupt Decline in Rate of People Moving."

  8. Urban Institute. "Job Quality and Economic Mobility."

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