Rural Counties Losing Jobs Faster Than Cities

This recession is worse than the previous two — and it is hitting manufacturing counties much harder than communities with high farm employment.

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Rural America has lost more jobs, and at a faster pace, than in the previous two severe economic downturns. (See the chart above, which shows the percentage of job loss since the beginning of each recession.) In this recession, rural counties have already lost 3.4% of their jobs. In the 2001 recession, job losses mounted to just above 1 percent, which was higher than the recession of 1990-01.

Huge swaths of rural Amerca now have unemployment rates that far exceed the national average. (See the map here for unemployment rates in rural and exurban counties for January.) The chart above, produced by economists Sean Moore and Mark Drabenstott, tells us first that this recession is severe, deep and continuing.

(The Yonder has asked several groups of economists to explain how this economic downturn is affecting rural America. This is the first of several reports.)

Moore and Drabenstott, working with the Rural Policy Research Institute, depict a rural economy that resisted the recession for some time before finally succumbing late last year.  You can see in the chart below that rural counties maintained steady employment until last fall. As recently as  November 2008, rural counties were showing a lower rate of job loss than urban communities. Since November, however, rural unemployment has accelerated.

Rural Policy Research Institute
Significant job losses began in urban counties before rural ones.

Now, rural counties have lost a bigger percentage of their jobs than have urban counties or the nation as a whole, according to Moore and Draenstott. (See chart below.) Rural counties had lost 3.4% of their jobs during the 12 months ending in January 2009. Urban counties lost 2.8 percent of their jobs. But, clearly, the steepest decline has occured since November.

Rural Policy Research Institute
Rural counties began losing jobs at a faster clip than urban counties in December.

Rural America as a whole did well in the early months of the recession because of boom conditions in agriculture; rural employment figures were strengthened by counties where agricultural employment dominates, according to RUPRI’s Moore and Drabenstott. The chart below shows that rural counties with heavy concentrations of farm-related employment were gaining jobs until late last year. (This chart shows the percent change in jobs from the year before.) After all, net farm income reached a record $90 billion in 2008. 

Rural Policy Research Institute
Counties with large agricultural employment held up better than most other rural counties.

Farm dependent counties are represented by the green line in the chart above.

The black line in the chart shows the change from the prior year in jobs in manufacturing-dependent counties. Rural counties with large employment in manufacturing have been hit extremely hard; manufacturing counties have lost 4.8 percent of their jobs since the recession began. (See chart below for change in jobs since December 2007, the official beginning of the recession.) 

Rural Policy Research Institute
Manufacturing-dependent counties have lost the most jobs in rural America.

The recession isn’t being felt evenly across rural communities. Farming counties have lost 2.4% of their jobs since the beginning of the recession, according to Moore and Drabenstott. In counties that are dependent on the mining industry, the number of jobs has actually increased by just over one-half a percent.

Moore and Drabenstott hopefully note that the past two recessions ended after 8 months, and the downturns in 1973-74 and 1981-82 ended after 16 months. “If history is a guide, therefore, the end of the current rural downturn may be in sight,” Moore and Drabenstott write.

 

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