Rural Job Market Turns Inside Out

The Great Plains was in decline for the first years of the 21st century. But since the Great Recession of 2007, the region bounced back while the rest of rural America struggled to create jobs.

Share This:

An unmistakable pattern emerges when you look at rural employment numbers before and after the Great Recession of 2007.

From 2001 to 2007, before the recession, the central swath of rural America running from the Northern Great Plains to north Texas is awash in red, meaning those counties had below average employment for the period. (See map below.)

Since the recession, however, the opposite trend has emerged, with the Great Plains leading the way in non-metro jobs while the rest of the nation has fallen behind. (See map below.)

“Growth in the nation’s heartland likely reflects higher commodity prices and the energy boom,” write researchers in a report on the dramatic turnabout in rural employment. And while the rest of the nation was grappling with the mortgage crisis, the Great Plains may have gotten off a little easier. “Its sparse population may have insulated this region from the housing bust.”

The rest of non-metro America wasn’t so lucky. The red areas in the second map included counties that were more dependent on the manufacturing economy, and they felt the full brunt of the recession and global competition.

The report is “Where the Jobs Went after 2007,” published by the National Agricultural & Rural Development Policy Center.

Other key findings in the report:

  • Self employment has become a bigger part of the rural economy. In non-metro counties, the percentage of workers who are self employed rose from 18 to 22 percent from 2001 to 2011, the report found. That matches a trend in metro America during the same period. 
  • Farm jobs are a declining part of both the rural and urban economies. In 2001 farm jobs represented 6.6 percent of all non-metro jobs. In 2011, that figure was down 1 point to 5.6 percent. There are now nearly as many farm jobs in metro counties (1.2 million) as there are in non-metro counties (1.4 million).
  • Mining jobs increased by 45 percent from 2007 to 2011. But those jobs are just a sliver of non-metro employment, representing less than 1% of rural jobs.
  • Manufacturing is hurting. The industry shed more than a quarter of its jobs in non-metro counties from 2001 to 2011. That’s a loss of 900,000 positions.
  • Construction in non-metro counties lost 20% of its jobs, but the overall impact on the rural economy was less because the industry does not employ as many workers as manufacturing.
  • Retailing is now the largest private job provider in non-metro counties, employing 14 out of every 100 workers there. That’s ahead of manufacturing and equal to local government employment.
  • Waste management employs twice as many workers as mining in non-metro America.

The authors say the following about the policy implications of their findings:

The rural economy is complex, with the predominant sectors continuing their shift away from agriculture and manufacturing to other sectors. Recently (2007-11) that shift included job reallocation out of construction and the key services sectors of retailing and information. Rural areas did not experience the Great Recession and subsequent mild recovery equally across the United States. Policies aimed at accelerating the slow recovery must take into consideration these differences. Low interest rates may not fuel recovery in investments in those areas that did not experience the run-up in housing prices prior to the bust, but could help manufacturing-dependent rural counties wishing to capitalize on revived U.S.-based manufacturing activity. For areas experiencing high growth rates in extractive industries (mining, etc.), low interest rates could fuel overinvestment. 

The report was written by Stephan J. Goetz, director of the Northeast Regional Center for Rural Development at Pennsylvania State University; Scott Loveridge , director of the North Central Regional Center for Rural Development at Michigan State University; and Don E. Albrecht, director of the Western Rural Development Center at Utah State University. 

Data in the report is from the Regional Economic Information System and the Bureau of Economic Analysis.

 

x

News Briefs