Rural Development Perspectives, Vol. 14, No. 1

Douglas Bowers, editor

Rural Development Perspectives No. (14-1) May 1999

About this magazine

Nontechnical articles on the results of new rural research and what those results mean. Shows the practical application of research in rural banking, aging, housing, the nonmetro labor force, poverty, and the effect of farm policies on rural areas. Contact: dbowers@ERS.USDA.gov.

In this report ...

Articles are in Adobe Acrobat PDF format.

Editor's Notebook and Contents

Feature Articles

• Increasing the Minimum Wage: Implications for Rural Poverty and Employment--Recent proposals to increase the minimum wage from $5.15 to $6.15 an hour would probably affect a larger share of rural than urban workers. The greatest effect would be in the South and Southwest where poverty rates are high and industries typically offer low wages. An increase of this magnitude would by itself have little effect on reducing poverty in either rural or urban areas, but combined with the Earned Income Tax Credit, could hold promise for lifting many minimum-wage workers and their families out of poverty. For more information, contact: Leslie A. Whitener.

• Community Empowerment: A New Approach for Rural Development--The 1993 legislation creating the Empowerment Zones and Enterprise Communities program represents a departure in Federal policy toward developing low-income rural and urban communities. By combining flexible, long-term financing with strategic planning and performance benchmarking, the program helps impoverished communities to address structural problems comprehensively, rather than applying 'stovepipe' programs to isolated issues. Although the program is only 3 years into implementation, the results are already remarkable. Rising congressional interest in the program’s success points to an expansion of the empowerment approach in coming years. For more information, contact: Leslie A. Whitener.

• Federal Funding's Unique Role in Appalachia--Rural Appalachia received relatively low levels of Federal funds in fiscal year 1997 compared with urban Appalachia. Although it had relatively high income support payments, reflecting high rates of poverty and unemployment, rural Appalachia received less per capita in Federal funding for community resources and other programs that create jobs and development. Mining and poverty counties were the chief rural beneficiaries of income support payments, while the more populous and prosperous rural manufacturing and commuting areas benefited more from community resource programs. For more information, contact: Faqir S. Bagi.

• Nonmetro Displaced Workers Face Less Hardship Than Metro Displaced Workers--During 1993-95, 4 million workers were displaced from their jobs, of which 775,000 (19 percent) were nonmetro workers. Although the displacement rate was similar for nonmetro and metro workers, nonmetro displaced workers were less likely to be unemployed at the survey date, found a new job faster, and had less earnings loss on the new job than did metro displaced workers. The nonmetro displaced worker was likely to be male, have at most a high school diploma, and be working as an operator, fabricator, or laborer. For more information, contact: Karen S. Hamrick.

• Financial Markets Serve Rural Areas Reasonably Well--When urban and rural loans are compared, average interest rates, collateral requirements, and other terms are nearly identical. Furthermore, national opinion surveys have generally found that rural borrowers are at least as satisfied with their financial service provider as are urban borrowers. The nature of rural economies--small communities, small borrowers, and undiversified industries--can lead to disparities in the availability of financial services among individual borrowers and communities, but financial market imperfections have not detracted substantially from overall rural growth. For more information, contact: Robert N. Collender.

• Tobacco Communities Facing Change--Legislation designed to combat smoking could have important consequences for the many communities where tobacco is grown and processed. Tobacco’s economic role has declined in most communities. The most vulnerable communities are those where tobacco production costs are high, farms are small, and where alternative crops and nonfarm opportunities are limited. For more information, contact: Fred Gale.

• Choosing To Work Off Farm--For most farm families, off-farm employment is an important source of additional income, and can also be used to mitigate the risks associated with farming activities and to provide essential additional funds. Total household income tends to be higher when off-farm wages can be counted on, most notably on farms with sales less than $250,000. Off-farm employment is more prevalent on certain types of farms than others, and the age and the educational level of farm operators are factors that can affect the decision and ability to work off farm. For more information, contact: Penni Korb.

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Past Issues

Updated date: May 1999