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Friday, October 07, 2011

Rural America:  An Update On Unemployment And Poverty


How is everything in your household?  Everyone working that wants a job?  Plenty of food on the table, and clothes for the kids?  You are not alone.  Economists and statisticians put lots of colors on employment and poverty charts to describe rural America, but those gaudy colors do not paint a pretty picture.

The Cornbelt is made of many large farmers who have all the work they can do to manage their operation.  Farming is complex and takes a lot more than an 8 hour day to remain profitable.  But the Cornbelt is also made up of many smaller farmers who not only work as much as possible on their operation, but also go to another job to put food on the table and care for their family.  The latter group in this agriculture dichotomy is described in a recent USDA report about unemployment and poverty.  And with many farm families working second and third jobs for either income or health insurance benefits, they are not always successful.

USDA’s Economics Research Service says unemployment in rural areas is not the same everywhere.  Data is developed from non-metropolitan counties, which were counties without a 50,000 population urban center, lower population density, and slow population growth.  Those were about two counties out of every three in the US.  In those counties unemployment actually fell slowly in 2010, and then leveled off early in the spring of 2011.  But USDA is quick to say the trend reflects a decline in the adult population working or looking for work.  “By second-quarter 2011, the share of unemployed people who had been looking for work for more than 1 year was the highest recorded. The recession took its heaviest toll in male-dominated industries, such as construction, widening the unemployment rate gap between men and women.”

While the unemployment rate leveled off in rural areas, the economists say the reason was not greater job opportunities, but a greater number of adults who were unable to find a job, and quit looking for a job.  Subsequently, the percentage of American adults who were employed stands at 55.4% in rural areas, less than the 59% in metropolitan areas, and down from the more than 61% average from 1991-2001.  In total, 40% of US counties experienced loss of job numbers over the past year.

Another trend is demonstrated by the greater difficulty for men to find employment in rural areas than women.  The USDA economists report male unemployment in rural areas grew by a higher rate than women because of cutbacks in construction and manufacturing, compared to healthcare and education that grew and hired more women.

The lack of jobs directly impacted the financial stability of many of those rural households, and ERS says, “The recession’s impact was reflected in the U.S. poverty rate, which increased to 14.3 percent in 2009, the highest rate since 1994. Between 2008 and 2009, the poverty rate in nonmetro areas grew by 1.5 percentage points, from 15.1 to 16.6 percent.”  The poverty rate for children in rural counties increased by 2% to 23.5%, compared to the 20% in metropolitan areas.

One bright spot was the trend that indicates more residents of rural areas are getting a high school education, which points to greater opportunities for employment and overall well-being.  There are still more in rural areas without a diploma, but the gap is closing.

Population growth is also slower in rural areas, despite an outward migration from urban centers.  While metropolitan counties saw a nearly 11% population growth in the past decade, rural counties only grew by 4.5%.

What is the situation in your county?

In rural counties unemployment remains more serious than in urban areas, and male jobs such as construction and manufacturing, which are second jobs for many farmers, are not expanding.  In fact, health care and education jobs, which attract many farm wives, are increasing in number.  While rural areas are seeing softer job growth than urban areas, the poverty rate is increasing as well in rural areas, and now one child in four in a rural county lives with a family below the poverty rate.

Posted by Stu Ellis on 10/07 at 08:38 AM | Permalink

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