NSAC's Blog

Rural Poverty Rates and Income Improving Slowly

September 26, 2014

Last week, the U.S. Census Bureau released its report Income and Poverty in the United States: 2013, which showed the number of Americans living in poverty declining for the first time since 2006, but with the poverty rate in rural America still higher than the national level.  While the U.S. Census Bureau report delivers some good news, the lagging income levels and slow decline in the poverty rate signals that more work and attention are needed in rural communities.

Income and Poverty Levels Slowly Improving

The most recent Census report is especially welcome, given how, back in March, we reported on “Rural Poverty and Well-being” research by the U.S. Department of Agriculture’s (USDA) Economic Research Service (ERS) which showed that the rural poverty rate (17.8 percent) in 2012 was at its highest since 1986.  Last week’s Census report showed the poverty rate in rural areas decreasing to 16.1 percent, while the poverty rate in the United States overall fell from 15 percent in 2012 to 14.5 percent in 2013.  In metropolitan areas, the poverty rate fell from 14.5 percent to 14.2 percent.

The report also showed similar, slight improvements in median household income, with the national level rising from $51,759 in 2012 to $51,939 in 2013.  However, the difference in median household income between rural and metropolitan areas is considerable – with a difference of over 20 percent in median income between the two areas. The median household income in metro areas rose from $53,758 to $54,042 between 2012 and 2013, while in rural areas, the median income rose from $41,796 to $42,881 between the same period.  Although the actual rural/urban income gap may not be quite as large when factoring in the cost of living, it is still worth considering when looking at what contributes to the population loss in rural areas that has been a trend over the past 3 years, according to recent population and migration research by ERS.

Place-Based Poverty 

When comparing the latest Census report findings with the spring ERS “Rural Poverty and Well-being” findings, poverty shows up as concentrating and persisting in particular regions of the country.  According to the Census report, while none of the four regions analyzed in the report – the Northeast, the Midwest, the South, and the West – experienced a significant change in income levels or the poverty rate between 2012 and 2013, the South continued to have a higher poverty rate and the lowest median income level than the other three regions at 16.1 percent (18.9 million people) and $48,128 respectively.  Additionally, the South was the only region in which the median income level decreased between 2012 and 2013 (though not at a statistically significant level).  While the Census report does not examine the factors behind the concentration of poverty, a multitude of factors will need to be taken into account to address and alleviate poverty in particularly hard hit and persistently poor areas.

Agriculture’s Role

Agriculture plays a critical role in the economies of rural communities and during the recession was able to provide a buffer against the skyrocketing unemployment rates experienced by most of the country.  States such as Texas and North Dakota, and those in the Great Plains experienced smaller increases in unemployment largely due to the more stable agriculture sector and booming energy markets.  However, the benefits experienced by these counties have for the most part evaporated since 2011. ERS found that while rural areas in some regions were able to weather the recession with relatively little job loss, rural job growth across the board has been stagnate since 2011.

According to the 2012 Census of Agriculture, the average age of a farmer in the United States is 58 years old and the fastest growing demographic is 65 years and older.  Furthermore, between 2007 and 2012, the United States lost close to 100,000 — or over 4 percent — of our nation’s farms.  And it’s not just farmers who are getting older.   Counties with primarily agriculture-based economies continued to lose population as a whole despite job growth in energy-related industries in these same counties. Farming counties have been particularly affected by an aging population, which contributes to slower population growth.  This coupled with stagnant job growth in many rural areas has led to the decline in community resiliency.

Agriculture allowed many rural counties to weather the turbulent years during the recession, which makes reversing these declines critical to improving the health and outlook of our rural communities.  It also puts a premium on investing in USDA rural community economic development initiatives that back proven growth strategies like micro-enterprise development, value-added agricultural businesses, and the growth of regional food markets.

Categories: General Interest, Rural Development

Comments are closed.