CORRECTED: While Most of U.S. Gets a Raise, Rural Areas Stand Pat
(A separate Daily Yonder story calls into question the findings of this Census report. Readers are encouraged to consider this article in light of these other findings.) In another sign that the economic recovery is moving very slowly for rural America, median household incomes for rural Americans didn’t improve from 2014 to 2015 while they did for metropolitan areas.
CORRECTION: After the publication of this story, the Center for Budget and Policy Priorities released an analysis saying the incomes and poverty in nonmetropolitan America had actually improved from 2014 to 2015. The Daily Yonder is leaving this post online because it accurately reflects the Census Bureau report on which the story is based. But readers are encouraged to see our other story describing methodological problems that may skew the findings in this report on metro vs. nonmetro economic performance. Tim Marema, Editor
While the rest of America got a raise last year for the first time since the Great Recession, average rural residents saw their wages remain flat or even fall a bit from 2014 to 2015, according to the U.S. Census Bureau.
The Census Bureau’s newly released income and earnings report for 2014-2015 showed that median household incomes rose last year for the nation for the first time since 2007. Nationally, median household income grew by about $2,800 to reach $56,516 in 2015. That’s an increase of a little more than 5 percent.
But the national increase hides geographic differences. People living in the principal cities of metropolitan statistical areas (MSAs) saw their median income rise by an estimated 7.3 percent. People in the suburbs (inside an MSA but not living in the principal city) had a median-income increase of 4 percent.
But median household income for rural Americans (those living outside a metropolitan statistical area) dropped by an estimated 2 percent from 2014 to 2015. The drop was within the survey’s margin of error, meaning the drop could be a little more or a little less than the estimate. But either way, rural America’s income picture is different from the rest of the nation’s.
“I think the most interesting thing is that the rural numbers were some of the only estimates [in the report] that did not show a statistically significant, gain,” wrote Keith Wiley, a researcher at the rural-focused Housing Assistance Council.
In other words, the rest of the nation did measurably better while rural America saw virtually no change.
The Census report had similar news for rural America in its poverty estimates. Metropolitan areas did better; rural areas did the same or perhaps a little worse. (See the chart on the right at the top of the page.)
Principal cities of metro areas saw their estimated poverty rates drop by 2 percentage points from 2014 to 2015. Suburban areas had an estimated poverty-rate drop of 1 percentage point. But the estimated poverty rate in rural areas climbed by 0.2 percentage points, although that change is also within the survey’s margin of error.
The absolute number of people living in federally defined poverty in rural America actually decreased from 2014 to 2015. But the percentage of people living in poverty climbed because the overall rural population shrunk. Nonmetropolitan population in 2015 was about 44 million, a decline of about 11 percent from the 2014 rural population estimate of about 50 million, the report said.
Median income is the level at which half of the population earns more and half earns less.
The report’s findings are based on data from the Census Bureau’s most recent annual survey of economic information. Data on individual counties won’t be out until this winter, so we’re unable to draw conclusions about how different parts of rural America performed economically.
How This Story Defines Rural
This story uses the definitions that are part of the U.S. Census Bureau’s report, “Income and Poverty in the United States: 2015,” by Bernadette D. Proctor, Jessica L. Semega, and Melissa A. Kollar. The researchers use three geographic areas in their analysis. 1. “Inside principal cities,” population that lives in the principal cities in a metropolitan statistical area. 2. “Outside principle cities,” population that lives in a metropolitan statistical area but not in one of that MSAs principal cities. 3. “Outside metropolitan statistical areas,” population that does not live in an MSA. The third category (outside MSA) is defined as rural in this story.