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exist, long-term displacements associated with new
technology create unemployment and thereby have
additional debilitating effects on the broader local
economy.

Technological change can exacerbate rural poverty
when plant closing and worker displacements are
abrupt and without mitigating efforts (Summers).
Retraining, outplacement, and other measures to
reallocate workers to new livelihoods can minimize
. unemployment spells and represent developmental
changes to the local economy. Nevertheless, techno-
logical change can also produce new jobs in rural
areas by altering demand for rural-based resources
or allowing the further decentralization of manufac-
turing and other economic activity.

FACTORS MAINTAINING RURAL
POVERTY

Migration

The propensity of individuals to endeavor to es-
cape poverty by seeking opportunities in other
places has been major source of change in rural
areas. Most migration today is by young workers to
urban areas and the coasts. Migration, therefore, can
be a problem for the communities left behind.

Net rural outmigration in 1986-87 reached
952,000 people, one-third of whom were 18-24 year
olds (O’Hare). In part because of the small pool of
skilled workers, it has been difficult to attract “high
tech” industries, so the rural demand for skilled labor
remains low relative to demand in urban areas. Lack-
ing attractive professional opportunities in their
home communities, educated rural young adults mi-
grate to urban centers to begin their careers.

Those migrating from rural areas are twice as
likely to be college graduates as those who stay
behind (O’Hare). Those with the greatest propensity
to leave also represent the most able and productive
human capital. Migration may alleviate some rural
poverty as workers seek better opportunities in other
places. Remittances to those who remain are not
generally an important source of income. Residents
staying in the rural county may have an easier time
obtaining what jobs do exist. Nevertheless, outmi-
gration is symptomatic of declining opportunity in a
locale.

Almost 27 percent of those who left rural areas in
1986-87 had four years of college. Rural communi-
ties have been unable to capture the social benefits
associated with public support for education. Local
governments often use this inability to rationalize
their low investment in education, perpetuating the
downward spiral in the rural human capital pool, and
further reducing their attractiveness to industry.

Deavers suggests that the magnitude of this external-
ity calls for an increase in the federal subsidy to rural
educational programs.

Age Structure

In some rural areas, poverty will fade because
natural decrease is reducing the resident population
and younger generations are able to find livelihoods
to sustain their presence. In other places, young
adults will continue to seek opportunities outside the
home county. The migration of working age people
often has deleterious effects on those left behind.
Children and the elderly are the least likely to have
the resources and ability to seek better conditions.
They often are the most dependent on the services
which rural governments cannot afford and are ill-
equipped to perform.

Children

Children comprise the fastest-growing category of
the rural poor. Nationally, Bane and Ellwood (1989)
find that there is a gradual and relatively stable
upward trend in the fraction of children who are poor
and living in female-headed households. In addition,
virtually all of the year-to-year fluctuations in pov-
erty among children, including true increases in the
1980s, can be traced to changes in the numbers of
poor children in two-parent homes. Poverty rates for
children in single-parent homes have averaged
roughly 50 percent since 1965. If welfare benefits
are not counted, poverty rates are higher still. Much
of this poverty is long term.

Differential rural birth rates and the declining op-
portunity structure of rural America make the prob-
lems of children in poverty particularly serious.
Coupled with the weak institutional structure of
services and income support for poor families, rural
children in poverty promise to be the source of the
next generation of adults who experience extreme
problems participating in the labor market.

Local Political Arrangements

The attitudes of local elites toward the poor and
development of the area economy in general have a
great bearing on the structure of opportunity and the
eventual poverty rate that characterizes an area
(Ford). Some local elites may exhibit passive or
active opposition to potential employers who present
competition for existing firms or are perceived to
disrupt the local wage structure. Ultimately, this
opposition denies opportunities to the poor (Molnar
and Lawson).

The literature on the impacts of new industry and
economic growth in rural communities suggests that
most of the immediate benefits accrue to local elites,

79




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