Major Difficulties in Reinvigorating U.S. Rural Areas

As previously discussed in this blog, most rural areas of the U.S. have aging, declining population. Therefore, this blog has advocated for increasing immigration and having these immigrants settle in the small and medium-size towns in these areas.[1]

However, Eduardo Porter, an economics writer for the New York Times, presents persuasive reasons why  reinvigorating these rural areas has been and will be very difficult.[2]

He starts by pointing out that for the last 25 years the 60 million people now living on farms and in hamlets and small towns have experienced “relentless economic decline” in terms of median income and population along with an increase in median age. Moreover, their share of U.S. population and income are shrinking while crime and opioid abuse are increasing. The result is “intensifying ruralization of distress,” with “distress”  measured “as a combination of data ranging from joblessness and poverty to abandoned homes and educational attainment.” Indeed, he says, “These days, economic growth bypasses rural economies.”

Although many ideas have surfaced on how to address and alleviate these problems, Porter is very doubtful that they will be successful.

The primary reason is “the inescapable reality of agglomeration, one of the most powerful forces shaping the American economy over the last three decades. Innovative companies choose to locate where other successful, innovative companies are. That’s where they can find lots of highly skilled workers. The more densely packed these pools of talent are, the more workers can learn from each other and the more productive they become. This dynamic feeds on itself, drawing more high-tech firms and highly skilled workers to where they already are.”

Therefore, he endorses a suggestion in a Brookings Institution report that any effort to address the problems of rural America should “focus on middle-sized places that are near big tech hubs and have some critical infrastructure, rather than scatter assistance all over the landscape.”

Another suggestion is to help rural residents relocate to prosperous cities and, therefore, focus on developing affordable housing in these cities.

Moreover, not all cities are equal in this regard. A Wall Street Journal article asserts, “Technology is creating an economy in which superstar employees work for superstar firms that gather them into superstar cities, leading to a stark geographic concentration of wealth.[3] The article cites to a study by the Brookings Institution that created an index of every metro area in the U.S.  according to the extent to which their workers use computers in their jobs (their digitalization), Those indices resulted in the following list of superstar cities:

  San Jose-Sunnyvale-Santa Clara, Calif.

  California-Lexington Park, Md.

  Huntsville, Ala.

  Boulder, Colo.

  Durham-Chapel Hill, N.C.

  Trenton, N.J.

 Washington D.C.-Arlington-Alexandria, Va.-Md.-W.Va.

 Boston-Cambridge-Newton, Mass.-N.H.

  Austin-Round Rock, Texas

  San Francisco-Oakland-Hayward, Calif.

  Ann Arbor, Mich.

  Salt Lake City, Utah

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[1] See the posts listed in the “U.S. Population & Immigration”  section in List of Posts to dwkcommentaries—Topical: United States (POLITICS).

[2]  Porter, The Hard Truths of Trying to ‘Save’ the Rural Economy, N.Y. Times (Dec. 14, 2018).

[3] Mims, Where You Should Move to Make the Most Money: America’s Superstar Cities, W.S.J. (Dec. 15, 2018).