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Economic gap is growing

READ MORE > 4,019 Reads
On Mon, 06/11/2018 - 09:56 AM

It turns out that it’s not just counties in Mississippi that feel like they’re being left behind by the modern economy.

Bloomberg Businessweek’s May 28 edition told the story of Adams County, Ohio, which is bracing for the closure of its biggest employer: two coal-fired power generation plants.

Like many parts of Mississippi, Adams County — 70 miles southeast of Cincinnati along the Ohio River — has a relatively small population of 28,000. And like Mississippi, the county has plenty of residents who like where they live but are worried about what lies ahead.

They are right to be concerned, because the gap between small-town America and the rest of the country is growing.

Bloomberg quotes a report that says metropolitan areas with 1 million or more people have experienced 16 percent employment growth since 2010, while areas with 250,000 to 1 million people have shown job growth of 11 percent.

Areas with fewer than 250,000 residents aren’t keeping up, and it isn’t even close: Job growth in those placed during the past eight years is just 0.4 percent.

That figure means that the average small community with 1,000 jobs in 2010 has only 1,004 now. That’s essentially no job growth, which also means that plenty of small communities have fewer jobs now — at a time when the national economy seems to be doing quite well.

The most interesting element of this puzzle may be the fact that, in spite of a decade’s worth of economic challenges, fewer Americans seem interested in moving. This is an amazing contrast to our three-century history of migration.

According to Bloomberg, in the early 1990s at least 3 percent of Americans moved across a state line each year. Today the rate is only half of that, and the number of people that moved in 2017 was the lowest in half a century. One economist attributes this to the idea that poverty and low income is now a reason to stay put, whereas it used to be a reason to move.

The loss of several hundred good-paying jobs in Adams County, says Bloomberg, is creating a policy problem: “Should there be a wholesale effort to revitalize places that have lost their original economic rationale? Or should the emphasis be on making it easier for people in these places to move elsewhere?”

If you live in small-town America, the answer is obvious: Policymakers should do both.

In Adams County’s case, it’s impossible to argue that two power generating plants are the area’s original economic rationale. So there is no reason not to try to find something else that can put people to work there. The same is true, of course, for any small community that’s struggling. If the national economy is doing well, that means businesses are expanding. Some of that will find its way to small towns.

However, it’s undeniable that some people should consider setting out for better opportunities. The world is changing, and bigger communities have an advantage.

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