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Editor’s Note: Every year the Economic Research Service publishes Rural America at a Glance, a timely update on the economy and demography of the areas of the U.S. outside the cities.
In this year’s edition, the researchers concentrate on the economy, naturally enough, given that the past few years have seen the largest decline in employment since the end of World War II.
Income also fell in both metro and rural America. And poverty rates rose.
The rural population grew by 91,000 people from July 2008 to July 2009, a gain, yes, but just one third of the increase during the same period from 2005 to ’06.
To see the full report, go here. Below, we have excerpts:
Jobs in Time of Recession
Both nonmetro and metro areas lost jobs throughout 2008 and 2009. In the first quarter of 2010, however, employment appears to have stabilized.
• Based on preliminary Local Area Unemployment Statistics (LAUS) data, the number of employed people in nonmetro areas fell by 4.9 percent from the fourth quarter of 2007 (the beginning of the recession) to the first quarter of 2010. Employment fell by 5.0 percent in metro areas.
• Preliminary LAUS data for the first quarter of 2010 show slight negative employment changes for both nonmetro and metro areas. This is the fourth quarter in a row that the pace of job loss has slowed.
• Manufacturing lost an estimated 642,000 jobs in nonmetro counties over this period, a decrease of 19.3 percent between the end of 2007 and the end of 2009. (By comparison, metro counties lost 2.2 million manufacturing jobs over the same period, a change of 16.3 percent.) Manufacturing now employs fewer people in nonmetro areas than do wholesale and retail trade.
• Nonmetro employment in construction fell by 371,000 over this period, a decrease of 19.0 percent. (For metro counties, the decline was 21.1 percent or 2.1 million jobs.)
• Other industries that lost more than 10 percent of their nonmetro employment over this period were information services (down 14.5 percent, or 52,000 jobs), and finance (down 13.9 percent, 149,000 jobs).
• Educational and health services, which is the largest employment sector in both metro and nonmetro areas, increased employment between the fourth quarters of 2007 and 2009, adding 400,000 jobs in nonmetro areas (8.0 percent) and 903,000 jobs in metro areas (3.4 percent).
• Agriculture, professional/business services, and the leisure/hospitality industries also posted employment gains in nonmetro areas over this period, in contrast to metro areas where all three sectors experienced job losses.
Unemployment Levels Off
After rising for 2.5 years, the seasonally adjusted official unemployment rate (U-3) peaked in the fourth quarter of 2009, at 9.6 percent in nonmetro areas and 10.1 percent in metro areas. These rates were the highest since 1983.
Since then, rates have shown some improvement: in the second quarter of 2010, the nonmetro unemployment rate was 9.4 percent, and the metro rate was 9.7 percent. An estimated 2.2 million people in nonmetro areas and 12.7 million in metro counties remain unemployed.
A broader measure of unemployment (U-6) includes “discouraged” workers (those who have given up actively seeking employment but are available and wanting to work) as well as those who are working part time but would prefer to work full time if full-time work were available.
This measure also leveled off in 2010. In the second quarter of 2010, the U-6 unemployment rate in nonmetro areas was 16.2 percent, and 16.8 percent in metro areas. These numbers correspond to 3.8 million unemployed or underemployed people in nonmetro counties, and 22.3 million in metro counties.
The average duration of unemployment for nonmetro workers (using the U-3 definition) was 26.5 weeks in the fourth quarter of 2009, up from 17.8 weeks in the same quarter in the previous year.
For metro workers, the search for a job was somewhat longer, averaging 29.2 weeks in the fourth quarter of 2009 compared with 20.0 weeks in the previous year. This is the longest average duration of unemployment ever recorded by the Bureau of Labor Statistics, which has tracked this outcome since 1948.
In the second quarter of 2010, nearly 43 percent of unemployed workers in nonmetro areas, and 46 percent in metro areas, had been out of work for more than 6 months (26 weeks).
Nonmetro Population Trendss
The percentage of Americans moving between counties dropped to historic lows between 2006 and 2009, reducing the rate of population growth throughout rural and small-town America, especially in areas that had previously been attracting large numbers of new residents (in-migrants).
The change reflected a constellation of developments that inhibited retirement migration and other discretionary moves: a decline in wealth as home values and stock market values fell; the increased difficulty of financing home purchases in the wake of the mortgage crisis; a decline in speculative real estate construction; and falling incomes and declining job opportunities as the economy moved into recession.
Between July 2008 and July 2009, the nonmetro population grew by 91,000, just a third of the population that was added during the corresponding 2005-06 period. Between 2005-06 and 2008-09, the number of nonmetro counties losing population rose from 995 to 1,123. Much of that population loss occurred in suburbanizing counties adjacent to metro areas, as well as in counties with scenic amenities.
• Population growth from natural increase (the difference between births and deaths) increased slightly in nonmetro areas between 2006 and 2009. Thus, the slowdown in the pace of nonmetro population growth, from 0.57 percent during 2005-06 to 0.18 percent during 2008-09, was caused exclusively by lower levels of net migration—the difference in people moving to and from nonmetro areas.
• The overall slowdown in U.S. population mobility caused a convergence in population growth rates among different types of counties, as fewer people moved into those counties that previously had the highest rates of growth. The slowdown in nonmetro suburbanization since 2006 was the first significant break in this trend since World War II. The previously consistent wide gap between adjacent and nonadjacent nonmetro counties in their rates of net migration to metro areas disappeared altogether in 2008-09.
• A similar trend toward convergence showed up among counties with and without scenic amenities. The 20 percent of nonmetro counties scoring lowest on the ERS natural amenities scale already had more out-migrants than in-migrants in 2005-06, and their further drop in net migration was relatively modest. In contrast, the top-rated scenic counties showed a steeper decline from a net in-migration rate above 0.8 percent in 2005-06 to near zero in 2008-09.
• Among the nearly 500 nonmetro counties that switched from net in-migration to net out-migration during this period were many with recreation- or tourism-based economies in New England, along the South Atlantic coast, in the Ozarks, and throughout the intermountain West. Baby boomers have led much of the amenity-based migration in recent years, as many had moved to high-amenity nonmetro destinations as they retired or in anticipation of retirement.
However, the expected upswing in migration to rural areas by the aging baby boom cohort did not materialize in 2008-09, dampened perhaps by declining job security and loss of wealth, especially home equity wealth.