Rural America at a Glance

During the 1990s, the U.S. experienced the longest economic expansion on record, with higher earnings and less poverty. Rural areas shared in the Nation’s prosperity, leading demographers to declare it the decade of the “rural rebound.” However, manufacturing went into a downturn in late summer 2000, and in March 2001, the economy slipped into an 8-month recession. Despite a continuing soft job market, rural areas fared better than urban areas in 2002, with higher job growth and lower unemployment. An analysis of ongoing changes in rural areas helps in assessing strategies to enhance economic opportunity and quality of life for rural Americans.

Overall effects of the 2001 recession on rural areas were mild compared with earlier recessions. Nonmetro employment stayed about level from 2001 to 2002, while metro employment fell. However, the effects were not uniform. Employment levels rose significantly in many nonmetro counties, particularly in the Northeast and the West, while falling in others. Employment losses in rural areas in the South and Midwest were largely a reflection of declines in manufacturing and mining. Average weekly earnings for nonmetro workers were $543 in 2002, about 80 percent of the $685 metro average. Nonmetro earnings, however, increased 1.4 percent during 2001-02, compared with 0.9 percent for metro earnings.

The sharp drop in exports in 2000, induced by a very strong dollar and sluggish world growth, contributed to a sharp decline in manufacturing jobs even before the recession started. Manufacturing employment has continued to drop despite recent export increases, disproportionally affecting rural communities. The steep decline in manufacturing jobs seen in 2001 had subsided by early 2003, with job decline at 4 percent in early 2003. Still, from the onset of the manufacturing downturn in August 2000, the share of manufacturing jobs lost was higher in nonmetro areas (19 percent) than in metro areas (14 percent).

Recently released 2001-02 population estimates show a leveling of the “rural rebound,” a period in the 1990s when population in most nonmetro counties grew much faster or declined more slowly than in the 1980s. Rural population growth has slowed since the mid-1990s, with a number of counties reverting to population loss. The South accounted for more than half of nonmetro population gains during 2001-02. Population growth in the nonmetro West was nearly twice the rate of the rest of rural America.