Rural Employment Grew in May, but Fewer People Are Seeking Jobs

The nation is nearly back to pre-pandemic employment levels. But rural workers are leaving the labor market at a faster pace than urban ones.

by Bill Bishop and Tim Marema July 7, 2021

May 2021 Jobs as Percentage of May 2019 Jobs

The map compares the most recently released county employment data (May 2021) to employment in May 2019, before the the pandemic affected the U.S. economy. Numbers reflect May 2021 employment as a percentage of May 2019 employment.

Rural counties added jobs at about the same pace as the rest of the nation in May, but a Daily Yonder analysis of Bureau of Labor Statistics data shows that the size of the rural workforce has yet to rebound from the pandemic.

Rural counties added 1.3 million jobs from May 2020 to May 2021. In May, rural employment was 2.2% lower than it was in May 2019, long before the start of the Covid-19 pandemic.

After adding about 13 million jobs from May 2020 to May 2021, metropolitan counties also had 2.2% fewer employees than they did in May 2019, before the start of the pandemic.

(Our analysis uses data from May 2021, which BLS released last week. To factor out seasonal variation in employment, we are comparing May data to the same month in 2020 and 2019.)

Where rural and metropolitan counties differ is in how the size of the workforce responded to the pandemic. Workforce includes all the people on the labor market – both people who have a job and those who don’t have a job but are seeking one.

In metropolitan counties, the size of the labor force bounced back from May 2020 to May 2021 and is now only 0.9% lower than it was in May 2019, before the pandemic.

In rural counties, however, the size of the labor force took a similar nosedive in May 2020 but barely grew in the subsequent year. The May 2021 rural labor force was down 2.1% compared to the pre-pandemic level. That’s more than twice the rate of decline in the metropolitan labor force.

Here is the total labor market for rural counties for May of the last three years:

  • May 2019: 21.2 million.
  • May 2020: 20.7 million (down 482,000 from 2019).
  • May 2021: 20.8 million (down 454,000 from 2019).

The good part of a smaller labor force is that it generally means a lower unemployment rate because fewer people are seeking work. The bad part is that it means a smaller labor market for potential employers, and it may signal the continuation of longer-term declines in the rural economy and consequently the size of the rural population.  

Regional Variance in Employment

National figures disguise significant regional differences.

The map above reports how close each county was in May of this year to having the same number of jobs as in May of 2019, before anyone had heard of Covid.

(The darker the color on the map, the higher the percentage of jobs today compared to May 2019. To get your local data, click on the map and then scroll over your county.)

You can see that there are dozens of rural Texas counties that are well below the national average in job recovery. We suspect that is because of the falloff in oil and gas exploration and production. Look at western North Dakota, where there was a boom in shale development until the onset of the pandemic. The center of that activity was Williams County. This May, Williams had only 80% of the jobs that were there two years earlier.

The Mountain West and the Deep South are getting back to their 2019 numbers. The East Coast and the Midwest, however, are lagging.

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