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Substantive innovation present in wholly rural single-unit firms

Wednesday, March 28, 2018

Innovation—the introduction of new products or ways of doing business that consumers value—is widely regarded as an essential component of resilient local economies. Using a comprehensive measure of innovation, ERS researchers found a higher prevalence of substantive innovators in urban (metro) areas. Over 31 percent of urban establishments (100 employees or more) were classified as substantive innovators, compared with nearly 23 percent of rural (nonmetro) establishments. This gap may reflect the potential innovation advantages stemming from denser business and consumer networks in urban areas. Researchers also examined the substantive innovation rates of single-unit firms to determine whether substantive innovation in rural areas was truly a rural phenomenon—not just innovation strategies of national or multi-national firms with rural production locations. About 20 percent of single-unit firms in rural areas were classified as substantive innovators, compared to nearly 23 percent overall, confirming that some wholly rural firms are pursuing more far-ranging innovation. This chart appears in the ERS report, Innovation in the Rural Nonfarm Economy: Its Effect on Job and Earnings Growth, 2010-2014, released September 2017.

Employment in rural inpatient healthcare facilities was relatively more concentrated in the Upper Midwest and Northern Great Plains

Thursday, March 8, 2018

Rural inpatient healthcare facilities—such as general hospitals, nursing care facilities, and residential mental health facilities—can improve the health and economic well-being of local communities. At its peak in 2011, rural inpatient healthcare employment reached over 1.25 million wage and salary jobs, or about 8.5 percent of total rural (wage and salary) employment. However, employment in the rural inpatient healthcare sector varies by region. Between 2001 and 2015, rural counties with the most inpatient healthcare facility jobs per resident were concentrated in the Upper Midwest and Northern Great Plains. Regions with fewer inpatient healthcare jobs per resident include much of the West, the Southern Great Plains, and the South. The regional variation in rural healthcare employment per resident may reflect in part the relatively heavier dependence of some sparsely populated areas on hospital employment, and the difficulty many rural communities face in attracting and retaining physicians and other healthcare professionals. One study found, for example, that over 85 percent of rural counties had a shortage of primary care health professionals in 2005. Additionally, between January 2010 and December 2016, 78 rural hospitals closed—about 4 percent of the 1,855 total rural hospitals. This chart appears in the ERS report, Employment Spillover Effects of Rural Inpatient Healthcare Facilities, released November 2017.

Some rural manufacturing establishments have similar innovation rates as their urban peers

Tuesday, January 9, 2018

Innovation—the introduction of new products or ways of doing business that consumers value—is widely regarded as an essential component of resilient local economies. Using a comprehensive measure of innovation, ERS research found 23 percent of rural establishments (with five or more employees) and 31 percent of urban establishments to be substantive innovators. Findings also suggest that substantive innovation in rural establishments in some industries are similar (not statistically different) to their urban peers. The similarity in innovation rates across manufacturing industries is particularly striking given presumed advantages of deeper supplier, customer, and information networks in urban areas. However, urban innovation advantages appear in the Services sector, which includes tradable industries such as wholesale trade, information, and financial services. This may reflect differences in the level of competition facing tradable services in rural and urban areas. This chart appears in the October 2017 Amber Waves finding, "Grassroots Innovation Widespread in Rural Areas, and Concentrated in Manufacturing."

Inpatient healthcare facilities had modest employment gains in rural areas, despite the effects of the Great Recession

Thursday, December 21, 2017

Rural inpatient healthcare facilities—such as general hospitals, nursing care facilities, and residential mental health facilities—can improve the health of local communities and provide jobs. From 2001 to 2015, inpatient healthcare facilities experienced modest employment gains in rural counties, despite the effects of the Great Recession. At its peak in 2011, inpatient healthcare employment represented over 1.25 million wage and salary jobs in rural areas. The growth of inpatient healthcare jobs in rural areas often exceeded the growth in several sectors including agriculture, manufacturing, and mining. Between 2007 and 2010, rural inpatient healthcare jobs rose by 26,000. Rural inpatient healthcare facilities accounted for 7.6 percent of wage and salary employment in 2001, rising to 8.1 percent by 2015. This chart appears in the ERS report Employment Spillover Effects of Rural Inpatient Healthcare Facilities, released December 2017.

The share of households with wired broadband remains below 60 percent in nearly 800 rural counties, mostly in poor and remote regions

Friday, November 17, 2017

Internet service providers have been increasing access to broadband in rural areas by expanding DSL and cable technologies, wireless platforms, satellite systems, and (to a lesser extent) fiber-optic systems. Despite a slower growth rate in broadband subscriptions since 2010 compared with the previous decade, county-level data indicate that rural household connectivity continues to improve and expand geographically. Between 2010 and 2016, the number of rural counties in which wired broadband subscriptions exceeded the rural average (60 percent or more of households) increased from 281 to nearly 1,200. Rural counties newly above the 60-percent threshold for broadband are concentrated in the Northeast, Upper Midwest, and the Intermountain West. Extensive parts of rural Appalachia also saw improvement in broadband access to above 60 percent. Broadband service remains more limited in two types of rural regions: (1) isolated, sparsely settled counties in the Great Plains, Nevada, New Mexico, Alaska, and elsewhere; and (2) high-poverty, high-minority regions, such as on tribal lands in the West and stretching from southern Virginia to east Texas in the South. This chart appears in the ERS report Rural America at a Glance, 2017 Edition, released November 2017.

Over half of manufacturing plants survived (still had paid employees) between 1996 and 2011

Friday, October 6, 2017

The number of U.S. manufacturing plants is declining, and plant startups and shutdowns are at their lowest since records began in 1977. Using a nationally representative sample of manufacturing plants, recent ERS research found that over half of plants survived (still had paid employees) between 1996 and 2011. Rural plants were slightly more likely to survive than those in urban counties: 57 percent versus 53 percent. Independent plants—single-unit manufacturing plants or firms with only one physical location—were more likely to survive than multi-unit plants. In rural counties, independent plants had an average survival rate of 62 percent, while multi-unit plants had a survival rate of 50 percent. Survival rates varied some by subsector, but rural textile mills and apparel product manufacturers had significantly lower survival rates (26 percent) than the average for all rural manufacturers (57 percent). This chart appears in the October 2017 Amber Waves feature, "Rural Manufacturing Survival and Its Role in the Rural Economy."

Some rural establishments are as likely to be innovative as their urban peers

Wednesday, September 20, 2017

Innovation is widely regarded as an essential component of resilient local economies. Using a comprehensive measure of innovation, ERS research found that some establishments in the rural (nonmetro) nonfarm economy are as likely to be innovative as their urban (metro) peers. About half of large rural and urban establishments (100 employees or more) were found to be substantive innovators. Among all establishments in manufacturing and service-providing industries characterized by high rates of patenting, the percentage of substantive innovators in rural and urban areas were also similar. However, an urban innovation advantage was evident for small (5-19 employees) and medium (20-99 employees) establishments. For example, the research found about 29 percent of medium-sized rural establishments to be substantive innovators, compared to 41 percent of their urban peers. This chart appears in the ERS report, Innovation in the Rural Nonfarm Economy: Its Effect on Job and Earnings Growth, 2010-2014, released September 2017.

Manufacturing employment declines were highest in the Eastern United States between 2001 and 2015

Tuesday, August 22, 2017

Manufacturing provides more jobs in rural America than many other sectors. In 2015, rural manufacturing jobs totaled 2.5 million, compared to 1.4 million farm jobs. Rural manufacturing jobs were also about equal to rural retail jobs, almost double rural construction jobs, and five times rural mining (including oil and gas extraction) jobs. However, U.S. manufacturing employment has been declining since the 1950s. Between 2001 and 2015—a period that included the recessions of 2001 and 2007-09—manufacturing employment fell by close to 30 percent. In addition, 71 percent of U.S. counties experienced a decline in manufacturing employment. Counties with the largest relative declines were concentrated in the Eastern United States, the traditional hub of U.S. manufacturing. In 2015, almost 20 percent of manufacturing jobs were located in rural counties. Factors such as globalization and rapid changes in technology have contributed to the decline in U.S. manufacturing employment. This chart appears in the ERS report Rural Manufacturing at a Glance, released August 2017.

Survival rates of manufacturing plants vary by county type and ownership structure

Wednesday, May 17, 2017

Between the 2001 and 2007-09 recessions, U.S. manufacturing employment fell by close to 30 percent. In many communities, the closing of a manufacturing plant can reduce local employment, earnings, and government tax revenue. To improve understanding of the factors affecting the survival of manufacturing plants, ERS studied plant survival over a 15-year period (1996 to 2011). Over this period, the average survival rate—the share of plants that were still employers—in rural (nonmetro) counties was 57 percent. By comparison, plants in urban (metro) counties had an average survival rate of 53 percent during this period. Survival rates also varied by ownership structure: Overall, independent plants (single-unit plants with only one physical location) had a 59-percent survival rate, while multi-unit plants had a 50-percent survival rate. Independent plants located in rural counties had the highest average survival rate (62 percent). Although States and regions have long tended to put more effort into recruiting and retaining multi-unit plants, the research shows that independent plants are more likely to survive—in both rural and urban counties. This chart appears in the ERS report Rural Manufacturing Resilience: Factors Associated With Plant Survival, 1996-2011, released May 2017.

Rural counties lead growth in U.S. natural gas production

Thursday, September 1, 2016

From 2000 to 2011, onshore gross withdrawals of natural gas in the lower 48 States increased by about 47 percent, reaching historic highs in every year after 2006. The most rural of counties?those that are outside the commuting area of a metropolitan area and lack a core urban area of at least 10,000 people, so called ?nonmetro noncore??accounted for nearly half of the growth in gas production. This growth is driven by nonmetro noncore gas-producing areas in the country?s midsection. Several metropolitan areas, notably the Fort Worth area in Texas, also contributed to the growth in natural gas production. Nonmetro micropolitan counties (nonmetro counties with small cities) as a whole accounted for only about 13 percent of the growth in natural gas production from 2000 to 2011. This chart and the underlying data (which include data on natural gas and oil production, as well as indicators of the degree of rurality) are found in the ERS data product, County-level Oil and Gas Production in the U.S., released in January 2014.

On average, rural veterans are older than nonveterans

Thursday, September 1, 2016

Nearly 4 million veterans reside in rural America (defined here as residents of nonmetropolitan counties). Rural veterans are an aging and increasingly diverse group of men and women who comprise nearly 11 percent of the rural adult population, although their numbers are consistently declining. The share of rural veterans differs by age, ranging from less than 3 percent of 18- to 34-year-olds up to 25 percent of those aged 65 and older. The age distribution of rural veterans tends to be older than nonveterans; nearly half of rural veterans were age 65 or older in 2012, compared with only 18 percent of rural nonveterans. The aging of the rural veteran population is largely due to the fact that a smaller share of the population now serves in the military than in the past. For instance, nearly 20 percent of American men served in the military during World War II, compared to less than 1 percent today. This chart comes from Rural Veterans at a Glance, EB-25, November 2013.

Nonmetro creative class counties found in nearly every State

Thursday, September 1, 2016

The creative class thesis?that towns need to attract engineers, architects, artists, and people in other creative occupations to compete in today's economy?may be particularly relevant to rural communities, which tend to lose much of their talent when young adults leave to attend college, pursue employment opportunities in urban areas, or join the armed forces. The ERS creative class codes indicate a county's share of population employed in occupations that require "thinking creatively." In 2007-11, 217 nonmetro counties ranked in the top 25 percent in the share of employment in creative class occupations. While rural counties generally lost employment and population in 2012-13, rural creative class counties gained, although at half the pace of urban creative class counties. Clusters of rural creative class counties are found in areas of natural beauty, such as the Rocky Mountains and northern New England, which are attractive places to live.? Adjacency to metropolitan areas and the presence of university or college towns are also associated with many rural creative class counties across the U.S. This map and the related underlying data are found in the ERS data product, Creative Class County Codes, updated May 2014.

Industry specialization varies across rural counties

Thursday, September 1, 2016

The ERS county economic typology codes are a classification system that provide a tool to analyze and characterize the economic dependence of U.S. counties. This typology reveals that rural (nonmetropolitan) counties have diverse industrial specializations. Where farming was once almost synonymous with rural, the predominance of farming as an industry in rural areas of the United States is now largely confined to the Plains States, and only 6 percent of the rural population in 2015 lived in the 391 rural farming-dependent counties. In contrast, although also declining in number, manufacturing predominated in the economies of a similar number of rural counties (351)?concentrated mainly east of the Mississippi but also including a scattering of counties further west?and these account for about 22 percent of the rural population. The 183 rural mining dependent counties accounted for 7 percent of rural population in 2015, and were the only economic type among rural counties to see strong population growth (1.6 percent) in 2010-15. A version of this map is found in the?Amber Waves?article, ?ERS County Economic Types Show a Changing Rural Landscape,? and the underlying codes may be found in the ERS data product,?County Typology Codes.

Rural veterans work in higher-paying industries

Thursday, September 1, 2016

Employment challenges facing recent military veterans are similar to those faced by all new civilian labor force entrants.? In addition to these challenges, veterans also face higher rates of disability.? The practical skills recent veterans have acquired are often superior to those of their nonveteran peers. As a result, the positive economic impacts veterans are likely making in rural America once they find work and start their careers can be seen in employment differences by industry. Rural veterans were more likely than rural nonveterans to be employed in higher-skilled, higher-paying industries in 2011, including manufacturing and professional and business services. ?While lower-paying industries such as education and health services, and leisure and hospitality (hotels, restaurants, etc.) employed over 30 percent of rural nonveteran workers in 2011, only 17 percent of rural veterans worked in these service industries. Just over 6 percent of rural veterans worked in agriculture (including fishing, forestry, and hunting). This chart is found in the ERS report Rural Veterans At A Glance, EB-25, November 2013.

Creative class county job growth resilient following recession

Thursday, September 1, 2016

During the pre-recession economic growth years, counties with a high percentage of their workforce employed in ?creative? occupations?engineers, scientists, artists, and others tasked with combining knowledge and ideas in novel ways?tended to experience higher rates of local employment growth than other counties, but having a high share of creative jobs did not offer much local job market protection during the 2007-09 recession.? ?Creative class? counties?those in the top quartile of all counties ranked by their share of creative jobs?were more likely to experience employment losses in the recession than other counties.? However, a higher share of creative class counties gained employment during the economic recovery. While a much higher percentage of metro counties have seen recent employment growth whether or not they are creative class counties, a higher share of nonmetro counties gained employment during both the recession and recovery, the latter group benefitting from employment gains driven mainly by the energy boom. This chart is derived from the October 2014 Amber Waves data feature, ?What Happened to the ?'Creative Class' Job Growth Engine? During the Recession and Recovery??

Service industries account for the largest share of rural and urban employment

Friday, March 25, 2016

Overall employment in rural (nonmetropolitan) areas accounts for between 13 and 14 percent of all U.S. employment. However, the distribution of employment across industries differs between rural and urban areas. Service industries account for the largest share of employment in both rural and urban areas but are more heavily represented in urban areas, where they account for close to three-fifths of all employment. Within the service sector, jobs in finance, real estate, administration, and professional/scientific/technical services were particularly concentrated in urban areas. Rural areas account for 72 percent of the Nation’s land area, and employment in primary extractive industries that depend largely on the distribution of land and natural resources is greater in rural than in urban areas. Nonetheless, these industries—farming and forestry/fishing/mining—accounted for just 10 percent of total rural employment in 2014. Manufacturing employment is also a bigger part of the employment mix in rural areas, largely reflecting past migration of manufacturing activities to lower wage and lower cost locations. Government employment was marginally more common in rural than in urban areas (16 versus 13 percent). This chart is found in the ERS topic page on Rural Employment and Unemployment.

Farming is important to the economies of many counties in the Plains States

Monday, January 11, 2016

ERS determined that farming was an important part of the local economy in 391 nonmetro counties and 53 metro counties, based on data on farming employment and earnings from the period 2010-12. These farming-dependent counties had at least 25 percent of average annual employee and self-proprietor personal earnings attributable to farming during 2010-12, or 16 percent or more of county jobs in farming in the same period, according to data from the Bureau of Economic Analysis. The proportion of earnings derived from farming ranged up to 83 percent of total employee and self-proprietor personal earnings and farming employment ranged up to 49 percent of total jobs among farming-dependent counties. Farming-dependent counties were primarily located in sparsely populated areas remote from major urban centers and are geographically concentrated in the Midwest and Great Plains. ERS analysis reveals the total number of farming-dependent counties fell from 511 in 2001 to 444 in 2010-12, continuing its long-term decline. A version of this map is found in the Amber Waves article, “ERS County Economic Types Show a Changing Rural Landscape,” and the underlying codes may be found in the ERS data product, County Typology Codes, updated December 7, 2015.

Rural education levels improve, still lag urban areas

Tuesday, December 8, 2015

In 1960, 60 percent of the rural population ages 25 and older had not completed high school. By 2014—more than 50 years later—that proportion had dropped to 15 percent. Over the same period, the proportion of rural adults ages 25 and older with a bachelor’s degree or higher increased from 5 percent to 19 percent but remained well below the proportion in urban areas (32 percent) in 2014. The proportion of rural adults with a college degree or more increased by 4 percentage points between 2000 and 2014 and the proportion without a high school degree or equivalent, such as a GED, declined by 9 percentage points. The gap between urban-rural college completion rates has increased, even for young adults, who are more likely to have completed high school than older cohorts. Between 2000 and 2014, the share of young adults age 25-34 (not shown in this chart) with bachelor’s degrees grew in urban areas from 29 to 35 percent. In rural areas, the college-educated proportion of young adults rose from 15 to 19 percent. This chart is found in the ERS publication, Rural America At A Glance, released November 30, 2015.

Nonmetro unemployment rates have declined, but remain highest for adults with the lowest levels of education

Friday, October 30, 2015

The nonmetro unemployment rate fell between 2010 and 2014 as the economy continued to recover from the national recession that began in late 2007. The likelihood of being unemployed was much higher for adults (ages 25 and older) at the lowest levels of educational attainment during the 2007-2014 period. Data from the Census Bureau’s Current Population Survey show that differences in unemployment rates between the least and most highly educated nonmetro adults nearly doubled over the 2007-2010 period. Since 2010, unemployment rates have fallen, especially for those without a high school diploma. In 2010, nearly 15 percent of adults without a high school diploma were unemployed, while in 2014, 9.6 percent of adults in this group were unemployed. Overall, unemployment rates declined across all levels of educational attainment for nonmetro adults, showing a gradual trend towards pre-recession levels. This chart is found on the ERS topic page on Rural Employment and Education, updated September 2015.

Nonmetro job growth accelerates in 2015, but is unevenly distributed

Friday, September 4, 2015

The number of rural (nonmetro) jobs rose by 239,000 (1.2 percent) between the second quarters of 2014 and 2015, more than double the rate of growth over the prior year. Rural job growth still lags behind the rate of growth in metro areas, which saw the number of jobs rise by 1.8 percent over this period. Moreover, while the number of jobs in urban areas now exceeds the peak levels recorded prior to the Great Recession in 2007, rural employment is still well below its pre-recession peak. Rural job growth was unevenly distributed; some 1311 rural counties saw no change or an increase in jobs (ranging up to 69 percent growth), but 665 experienced job declines, with the largest decline being 19 percent. Rural counties in several oil and gas-producing states, such as Texas, Kansas, and North Dakota, which had generally experienced job growth between 2013 and 2014, experienced declines in 2014-15. The vast majority (88 percent) of rural counties in the block of Southern States stretching from Arkansas to Georgia experienced job growth, whereas, in 2013-14, 71 percent of these rural counties had employment losses. This map updates one found in the ERS report, Rural America At a Glance, 2014 Edition.

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