Keywords: Economic recovery, employment, poverty rates, rural unemployment, rural America
Overview
An important indicator of economic recovery is employment. After several years of stagnation, the pace of employment growth in rural areas increased in 2014. Employment gains were significantly higher over the past year compared to previous years in the recovery period, although rural employment remains below pre-recession levels. Rural areas continue to experience population loss, higher poverty rates, and lower educational attainment than urban areas.
Slow Growth in Rural Employment
Rural employment has started to recover from its recessionary low
Employment grew more than 1 percent in rural areas during the year that ended in the second quarter of 2015.1 This is a marked improvement from previous years of very slow growth or decline. Nonetheless, rural employment in mid-2015 was still 3.2 percent below its pre-recession peak in 2007. In contrast, urban employment rose nearly 2 percent in the past year, continuing a trend of consistent growth since 2011, and is now well above its pre-recession peak. In both urban and rural areas, employment growth is running slightly ahead of population growth.
Local Area Unemployment Statistics (LAUS) data, seasonally adjusted. The LAUS program produces employment, unemployment, and labor force data for census regions and divisions, States, counties, metropolitan areas, and many cities, by place of residence. Note: LAUS data from 2007 through 2009 were adjusted to account for revised population growth estimates for that period. National employment was also benchmarked to match the Current Population Survey’s research employment series, for all years.
Rural employment gains in 2014 and early 2015 after 2 years of stagnationEmployment Index (2008 Q1=100)
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| Source: USDA, Economic Research Service analysis of Bureau of Labor Statistics, Local Area Unemployment Statistics (LAUS) data, seasonally adjusted. The LAUS program produces employment, unemployment, and labor force data for census regions and divisions, States, counties, metropolitan areas, and many cities, by place of residence. Note: LAUS data from 2007 through 2009 were adjusted to account for revised population growth estimates for that period. National employment was also benchmarked to match the Current Population Survey’s research employment series, for all years. |
Rural unemployment continues to decline
The unemployment rate has fallen considerably and fairly consistently in both rural and urban areas over the last 5 years. Unemployment rates fell by a full percentage point or more in each of the last 2 calendar years in both rural and urban areas. The parallel declines in rural and urban unemployment rates reflect the fact that in rural areas population and labor force growth are near zero, while employment is growing slowly, whereas in urban areas, population and labor force growth are positive, and employment growth is higher.
The share of adults who are working is lower than pre-recession levels
While urban employment levels have now recovered from the 2007-09 recession, the share of adults who are working (total employment as a share of residents age 16 or older who are not on active military duty or in institutions such as nursing homes or prisons) remains 3 percentage points below its level prior to the recession in both rural and urban areas. Part of the decline in this ratio since 2007 reflects the aging of the population, with a larger proportion of adults advancing into ages where most are retired. But retirement does not fully explain the persistence of low employment rates: the share of the prime working-age adult population (25-54) that is employed also dropped, from 80 percent in the first quarter of 2007 to 75 percent in the first quarter of 2010, before recovering to 77 percent in September 2015.
Population Decline Continues in Rural America
The number of people living in rural counties stood at just over 46 million in 2014—nearly 15 percent of U.S. residents. However, the population of rural America has declined by 116,000 over the last 4 years, with losses of about 30,000 people in each of the last 2 years. While these declines are small, 2010-2014 is the first period of overall population decline on record for rural America as a whole, and stands in stark contrast with the urban population, which continues to grow by more than 2 million per year. Not all rural areas have experienced population loss in recent years. Some rural counties have seen population growth, with nearly 700 growing rural counties together adding over 400,000 residents between 2010 and 2014. These counties are concentrated in scenic areas such as the Rocky Mountains or southern Appalachia, or in energy boom regions such as in the northern Great Plains. The 1,300 rural counties losing population since 2010 are widespread in regions dependent on farming, manufacturing, or resource extraction......Download the report
