Rural Economic Features and Performance—A Seventh District Overview Federal Reserve Bank of Chicago October 26, 2011

Roadmap Performance – Population – Income – Unemployment Economic Structure – Agriculture – Manufacturing – Retirement/recreation – Education Challenges and Opportunities

Population

U.S. population still urbanizing

Population “rural” is fairly close across U.S. regions

Population growth varies much across counties Source: ERS “Atlas of Rural and Small- town America.”

“Ruralness” varies greatly; being adjacent to highways and metro areas has mattered to growth (historically) Source: ERS, “Atlas of Rural and Small-town America”

District and Wisconsin population

Indiana and Iowa population

Illinois and Michigan

Income

Per capita income in metro vs. non- metro in U.S. largely same spread since 1969

Economic conditions vary Source: ERS, “Atlas” Persistent poverty

District incomes apace since 1969, while WI moved ahead this decade

Michigan is faring well lately, while IA is catching up to lagging decade(s)

Non-metro counties have also lagged in IL and IN, with recent gains

Unemployment

Economic conditions vary Unemployment 2010 Source: ERS, “Atlas”

Unemployment runs apace in the District, with WI non-metro URs usually higher

Non-metro URs also higher in IA and MI

IL non-metro has been “spot on” while non-metro runs higher in Indiana

Roadmap Performance – Population – Income – Unemployment Economic Structure – Agriculture – Manufacturing – Retirement/recreation – Education Challenges and Opportunities

Agriculture

Farm productivity

7th District Crop Yield Indexes (1964=100) Corn Soybeans

Real Crop Prices

The farm economy recovery – the basis of rising asset prices?

Real farm earnings have been leading other sectors in most District states

Indiana and Illinois

Iowa and Michigan

Farm Operator Income—Over time, as farms have dwindled and consolidated, proprietors’ income has grown, and non-farm income has become increasingly important

Many small farms subsist on non-farm income—either with one or more working non-farm jobs, or “hobby farms”

Only large farms and very small farms are growing; Most farmland accounted for by very large farms Source: ERS

Manufacturing

Farm dependent counties (20 Percent of more of income); Mfg dependent counties (30 percent or more)

Wisconsin non-metros have fared “well” in mfg. And value-added mfg. in food processing:

Manufacturing Share of Jobs, 1969; Non-metro counties

Manufacturing Share of Jobs, 2009; Non-metro counties

Still, manufacturing jobs shrink in relative importance…..so rural areas remain challenged

Declining jobs have fared “less worse” in District’s non-metro areas since 1969

Michigan has fared the worst, Iowa the best

Illinois rural manufacturing has performed especially poorly, losing one-half since 1969

Manufacturing is no exception—education/skills matter to keeping or growing jobs

Education pays, be it services or goods production, metro or non-metro

Educational attainment higher in metropolitan counties in U.S., with gains in both places

Low-education non-metro counties are rare in the Midwest

Nonetheless, few non-metro counties exceed their own statewide average in attainment. Share with Some College Education, Non-metro Counties

Retirement/Recreation

Population Growth by Amenities

Recreation/retirement counties

Govt/retirement

Population growth varies much across counties Source: ERS “Atlas of Rural and Small- town America.”

Where do Walworth County’s vacationers come in from? Source: Kenneth Johnson.

At end: Find your own roadmap, hopefully, the conversations at this conference will help Performance – Population – Income – Unemployment Economic Structure – Agriculture – Manufacturing – Retirement/recreation – Education Challenges and Opportunities – Health Care – Immigration – Financial network/venture capital – Infrastructure – Housing – Attracting and retaining workers – Research and wise policy