The South is in Crisis: The Challenges Facing Manufacturing Counties in the U.S. South

Sunday - November 19 2023, 02:39 UTC - 1 year ago

The rural South in the U.S. suffers greatly from economic inequality, with the lowest average income in the country and the highest rate of death by despair. It is especially difficult for counties that rely on manufacturing as their main economic activity, with residents there dying up to two and a half years younger than the average American. Various economic, health, and educational issues threaten the region, with financial institutions and hospitals at risk of closure due to increased poverty and decreased funding.

For a brief moment in the summer of 2023, the surprise No. 1 song "Rich Men North of Richmond" focused the country’s attention on a region that often gets overlooked in discussions of the U.S. economy. Although the U.S. media sometimes pays attention to the rural South — often concentrating on guns, religion and opioid overdoses — it has too often neglected the broad scope and root causes of the region’s current problems.

As economic historians based in North Carolina and Tennessee, we want a fuller version of the story to be told. Various parts of the rural South are struggling, but here we want to focus on the forlorn areas that the U.S. Department of Agriculture refers to as "rural manufacturing counties" — places where manufacturing is, or traditionally was, the main economic activity.

You can find such counties in every Southern state, although they were historically clustered in Alabama, Georgia, North and South Carolina, and Tennessee. And they are suffering terribly.

Yes, the South is actually in crisis .

First, let’s back up. One might be tempted to ask: Are things really that bad? Hasn’t the Sun Belt been booming? But in fact, by a range of economic indicators — personal income per capita and the proportion of the population living in poverty, for starters – large parts of the South, and particularly the rural South, are struggling.

Gross domestic product per capita in the region has been stuck at about 90% of the national average for decades, with average income even lower in rural areas. About 1 in 5 counties in the South is marked by "persistent poverty" — a poverty rate that has stayed above 20% for three decades running. Indeed, fully 80% of all persistently poor counties in the U.S. are in the South.

Persistent poverty is, of course, linked to a host of other problems. The South’s rural counties are marked by low levels of educational attainment, measured both by high school and college graduation rates. Meanwhile, labor-force participation rates in the South are far lower than in the nation as a whole.

Unsurprisingly, these issues stifle economic growth.

Meanwhile, financial institutions have fled the region: The South as a whole lost 62% of its banks between 1980 and 2020, with the decline sharpest in rural areas. At the same time, local hospitals and medical facilities have been shuttering, while funding for everything from emergency services to wellness programs has been cut.

Less wealth, less health .

Relatedly, the rural South is ground zero for poor health in the U.S., with life expectancy far lower than the national average. So-called "deaths of despair" such as suicides and accidental overdoses are common, and rates of obesity, diabetes, hypertension, heart disease and stroke are high – much higher than in rural areas in other parts of the U.S. and in the U.S. as a whole.

Manufacturing counties in the rural South are particularly unhealthy. Residents there die about two and a half years younger than the average American, which to demographers is a staggeringly high differential.

These things, of course, didn’t happen in a vacuum. The Obama-era Affordable Care Act encouraged states to expand Medicaid, but approximately half the states in the nation — all in the South — opted out. Our research has also identified a racing rural/urban divide in the region. High-end services such as medical specialists, for instance, remain concentrated in urban areas.