Special Report, Part 2: The poverty problem in the rural mountains of WNC

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The Poverty Problem in the Rural Mountain Communities of WNC

Rural jobs and rural life

The decline in unemployment is a result of a declining population, not from a growing number of workers. 

MORE IN THIS SPECIAL REPORT: Increasing poverty rates in rural Western North Carolina counties prompts questions about both rural economies and rural lives. In the first part of a series on rural poverty, Carolina Public Press looked at the overarching trends in poverty at the 50th anniversary of the War on Poverty.

National studies show that rural economies are shifting, and it likely comes as no surprise that Western North Carolina is not an exception. Job market changes and new business trends are altering how rural residents earn their living.

But where can those living in rural Western North Carolina find work in this changing economy, even with high-impact layoffs still fresh for some?

Steph Guinan/Carolina Public Press

Steph Guinan/Carolina Public Press

Figures from the N.C. Rural Economic Development Center and the N.C. Department of Commerce’s Division of Employment Security (formerly the N.C. Employment Security Commission) show that transportation and utility sector is consistently high across rural WNC counties, which includes most of the 18 westernmost counties of North Carolina. Only Buncombe County is considered an urban area, according to classifications by the White House.

The sector — which includes jobs like truck and bus drivers and those working in water or electricity management and production –  averaged 18 percent of all employment in these counties, with $26,785 in annual wages in 2011. However, it was not the lowest average wage for the region. Arts and entertainment averaged $21,144, followed by the retail sector at $21,890.

Mitchell County is the only mountain county with any significant employment in the mining sector. At 8 percent of the county’s employment, this sector had negligible impact on the region as a whole, but these mining jobs averaged salaries of $61,979 — some of the highest to be found in the region.

Manufacturing remains arguably strongest in McDowell County, accounting for 33 percent of the county’s employment, with average annual wages of $39,092. This is slightly higher than the regional average of $36,669 in wages for jobs in the manufacturing sector.

Patrick Woodie

Patrick Woodie, N.C. Rural Economic Development Center

Patrick Woodie, of the N.C. Rural Economic Development Center, said the health care sector is of particular interest to his organization, a nonprofit with a mission of “improving the lives of rural North Carolinians through the development, promotion and implementation of sound economic strategies.”

He noted that “rural North Carolina has greater health care needs and less of an ability to recruit health care professionals then our urban counterparts.” A move toward improving access to health care in rural communities has meant that “it was the only sector of the economy from 2008 to 2012 that added jobs in rural communities.”

In WNC, the health care sector accounted for 16 percent of regional rural employment.

But health care jobs is a sector offering a broad range of career pathways and many entry points, Woodie noted.

“I’ll be the first to acknowledge that some of the entry-level jobs certainly would not compare to a manufacturing job and would be a struggle to really provide a living wage for a small family,” he said. For example, the number of primary care physicians — arguably one of the highest paid health care positions in rural communities — has declined in WNC since 2010.

In its 2007 nationwide report on the rural economy, the White House found significant change in several employment categories of “high-density rural” communities, or rural counties with more than 25 people per square mile. Since 1970, farming and manufacturing — both mainstays in the region’s “traditional” economy — have both decreased significantly. However, the services sector has grown over the same time period.

Steph Guinan/Carolina Public Press

Steph Guinan/Carolina Public Press

“I graduated high school in the early 1980s,” Woodie said. “It wasn’t all that long ago, but I can even go back to that time and know that classmates of mine coming out of high school had the choice certainly of higher education, going to a community college or going to a university, but they also, as recent as that, had the option of going to work in one of several factories in town and staying there, like their parent’s did for the next 30 – 40 years.

“That really was a common thing that occurred for many of those folks, and it really went away beginning with the 2000-2001 recession and really with the opening up of the entire globe to more competition and freer competition.”

Marshall Milling Company Gristmill and Capitola Manufacturing Company along the French Broad River in 1982. Photo courtesy of the Library of Congress

Marshall Milling Company Gristmill and Capitola Manufacturing Company along the French Broad River in 1982. Photo courtesy of the Library of Congress

With shrinking employment in manufacturing and very few large corporations in the region, small businesses remain in the majority, according to North Carolina employment officials.

Small businesses – those with fewer than 100 employees –  drive the rural economy, both in the number of individual businesses and in the number of workers they employ. In rural WNC, businesses with more than 100 workers employ only 25.3 percent of job holders on average. However, businesses with fewer than 19 employees account for 49.7 percent of the workforce.

Steph Guinan/Carolina Public Press

Steph Guinan/Carolina Public Press

There are only a handful of mountain counties where big businesses are the majority. In McDowell County, big business takes the form of manufacturing companies such as Ethan Allen, Baxter Healthcare, Coats American, Rock Tenn Services and Columbia Carolina. Polk County’s big businesses are centered in the education and health care services industry and include St. Luke’s Hospital, Acts Inc., White Oak Manor and CooperRiis. In Mitchell County, mining operations are managed by large corporations who have locations around the globe.

Rural unemployment higher than urban areas, both nationally and regionally

Steph Guinan/Carolina Public Press

Steph Guinan/Carolina Public Press

The unemployment spike of 2008 and 2009 was significant for both rural and urban areas of the region, but the spike was steeper for rural counties. Before the recession, these counties already tracked higher unemployment, but rates were slowly declining. Following the recession, the gap between rural and urban widened. With indications of recovery, 2013 saw the lowest unemployment in rural WNC since the 2009 spike.

However, according to the U.S. Department of Agriculture, the nation’s recent drop in rural unemployment is not a result of more people finding work. Instead, the department reports, it resulted from the combination of stagnant job growth and population decreases as people relocate to urban areas.

The USDA’s 2013 report “Rural America at a Glance” stated that “in non-metro areas, the recent decline in unemployment rates is due to a reduction in the rate of labor force participation (the share of the adult population that is working or looking for work), rather than an increase in employment.”

MORE: Read analysis of the decline in North Carolina’s overall unemployment rate following public policy changes in “State unemployment rate hits low, but recovery still elusive.”

Analysts have commented that, since the recession, rural areas have been slower to recover then urban locations.

Todd Cherry,

Todd Cherry, Appalachian State University

According to Todd Cherry at the Center for Economic Research and Policy Analysis at Appalachian State University, a slow recovery was also the case following the 2001 recession. In a 2009 report, Cherry said, “During the (2001) recession, the WNC (region) experienced job losses that were three times greater in percentage terms than the state and nation. The brunt of the regional job losses was felt in the rural counties and the foothills — particularly the Hickory area.”

“WNC and many rural areas of the state are not experiencing the same economic prosperity as NC’s urban centers,” he continued.

The effects of poverty on daily life

Combining the economic depression of rural WNC counties with isolation and infrastructure challenges can result in a difficult situation for those living in these communities.

Across areas of health care, education, food security and other basic needs, many remote locations fall short when compared to their urban counterparts.

Even a basic need such as getting  health care can be a challenge.

Where Buncombe County has more than 35 physicians per 10,000 people, both Graham and Clay counties have less than 5 physicians per 10,000 people.

Steph Guinan/Caroina Public Press

Steph Guinan/Caroina Public Press

In a 2014 article published by the North Carolina Medical Journal, researches Julie Spero and Erin Fraher explained that “shortfalls in the supply of health professionals in rural areas are a concern because rural populations tend to be in poorer health relative to metropolitan populations, with higher rates of obesity as well as higher rates of mortality from chronic diseases such as diabetes and chronic obstructive pulmonary disease.”

In addition to having increased needs for health care, barriers to health care access for rural populations include “longer driving distances and limited access to transportation.”

Additionally, in educational attainment alone, those living below the poverty line have a larger percentage of lower education attainment. When compared to the demographics of those living above the poverty line, there a greater percentage of the population at a higher education level.

Steph Guinan/Carolina Public Press

Steph Guinan/Carolina Public Press

For regional residents below the poverty line, most counties show that more than half of residents have high school education levels or less. The anomalies to this pattern can be found in Watauga and Polk counties.

Reports also show that high school dropout rates are higher for those living in poverty. The N.C. Department of Public Instruction states that 22.7 percent of students from economically disadvantaged households drop out as compared to 10.1 percent of wealthier households.

With the effects of poverty on daily life and on the larger economic challenges facing the WNC’s rural communities, the data begins to show the breadth of struggles more and more mountain residents now — or could soon — encounter.

As economist Todd Cherry said in his 2009 report, “The divide between rural and urban areas in N.C. deserves attention from policymakers because the degree that we effectively use the resources in rural N.C. will significantly impact the future of N.C.’s economy.”


Editor’s note: Steph Guinan was awarded the McGraw-Hill Data Journalism Award by International Center for Journalists in March 2014 for a version of this series.

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About the Author

Steph Guinan

Steph Guinan is a contributing data visualization reporter with Carolina Public Press. Contact her at stephguinan@gmail.com.

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