Michigan State University Extension
Ag Experiment Station Special Reports - SR399301
07/28/98
Lynn Harvey, Colletta Moser, and Raymond Vlasin
The following article summarizes ideas presented at the
on "The Status and Potential of Michigan Agriculture", Secti
Policy, Resource, and Food Systems, Michigan Agricultural E
Station, Kellogg Center, March 26-27, 1992.1)
Population, Employment and Income Changes Affecting Rura
Communities
Population continues to change in rural areas, but not
Some 61 Michigan counties can be described as rural. In 198
Michigan's rural population was 1,849,699, or 20 percent of
population. From 1980 to 1990, Michigan's rural counties le
metropolitan counties with a 3.8 percent increase in populat
the same period the population of metropolitan counties fell
percent.
Some regions of the state showed substantially more pop
growth than did others. Rural counties in the Northwest reg
Michigan) were the top growth regions, with a 10.9 percent i
during 1980-90, followed closely by the Northeast region wit
percent increase. The Upper Peninsula was the only rural re
population declined during the period, with a 1.8 percent de
Most rural counties remain sparsely settled. In fact, t
majority of the towns in rural counties have fewer than 5,00
This sparse settlement constitutes a challenge when communit
efficiencies in providing public services, or when they addr
for business growth and improved economic well-being.
Population growth in a number of rural counties is attr
increased in-migration of retirees. These retirees bring fi
often supplemented by investment earnings and increased dema
quality consumer services, including retail, professional an
recreational services, and health care. They also bring a f
knowledge and expertise.4)
Rural areas have become more diverse in character and p
is possible that no single trend is more profound in its imp
growth in the diversity of rural areas. In earlier times, o
into agricultural regions and find much similarity among var
communities. The situation is changed.
Rural Michigan has a diverse economic base compared to
states, and this is evident in the mix of job opportunities.
counties and communities are still dominated by farm and agr
employment. Many others, however, find their major employme
manufacturing, trade, service or government, and they may ha
significant amounts of employment in construction, finance,
and real estate.
Employment growth has varied as well among rural areas.
Michigan's rural employment growth of 11.2 percent exceeded
percent growth in metro areas over the last decade (1980-89)
counties have not shared equally in growth. The Mid-Michiga
well ahead of the others (15.7 percent increase) while the U
Peninsula had the least employment growth (3.5 percent).5)
These employment growth figures mask the fact that unem
rural regions (8.4 percent in 1989) remains higher than the
average (7.1 percent in 1989). Population and labor force i
areas have been increasing alongside the increased job oppor
keeping unemployment relatively high despite the job growth.
Moreover, underemployment, in terms of part-time employment
at jobs utilizing lower skill levels, is high in rural areas
times, people maintain farm employment after being laid off
farm jobs. Thus, they are not classified as unemployed.
The employment growth that has occurred has not transla
much improvement in real per capita income. The per capita
Michigan rural areas remains at least 23 percent below the s
average. This relationship is consistent with rural areas n
The percent of workers engaged in manufacturing in rura
(18.5 percent) has remained constant in recent years (1982-8
is a period when manufacturing jobs declined nationally.8)
job growth in rural Michigan has come in the service sector
doubled in recent years (1981-89). It now accounts for over
of rural jobs.9)
Of particular importance is the fact that farm househol
close and growing tie to non-farm employment. A 1989 survey
farms by Moser and Vlasin revealed that 52 percent of the fa
and 49 percent of the spouses worked off-farm. What was mor
is that the large majority of those who worked off-farm work
off-farm. In addition, up to 40 percent of all operators we
to seek additional off-farm employment.10)
Also of major importance is that the availability of of
appears to have deteriorated, according to farm operators an
In the 1989 survey, 34 percent indicated that job opportunit
gotten worse, compared to 26 percent that indicated job oppo
had improved. The survey results preceded the rise in unemp
1990-1992, which undoubtedly has further reduced job opportu
Employment opportunities generally are greater for rura
living within commuting distance of urban areas than for oth
families. Those who are able to take advantage of these opp
commute to urban areas for part-time and full-time employmen
Typically, the more distant the rural areas are from urban a
fewer are the opportunities for year-round and full-time emp
the less jobs pay.
Changes in the Quality of Services Available in Rural Co
The quality of life of rural areas is affected by the q
quality of services produced and provided by local governmen
Communities vary widely in the range of services they provid
also vary widely in their ability to produce and fund the se
demanded by local residents. In addition, the quantity and
services produced and provided have a direct effect on the
competitiveness of an area--its ability to appeal to, and re
private enterprises in economically viable activities.12)
Historically, the production and provision of local com
services has been a joint effort among federal, state and lo
governments. The physical infrastructure of rural communiti
in large part, subsidized by federal transfers to local gove
Matching federal grants with local funds was the primary mea
constructing rural sewer and water systems, roads, and local
buildings.
State government contributed both matching and general
grants to local governments. Grants were provided for devel
capacity to deliver education, health and human service prog
libraries, and law enforcement, all of which were essential
rural welfare. More recently, state grants were given to pl
foster, economic development.
Changes have occurred in federal and state policies and
reducing financial support for local government services. T
reductions in external support have reduced the ability of s
local governments to provide public services. If the commun
question are also suffering economic stress, there may be an
reduction in private sector services.
The 1989 survey of Michigan farm operators and spouses
insights about service quality in rural areas. Farm operato
spouses were asked to evaluate local services and facilities
whether they had improved, gotten worse or stayed the same o
five years (1984-1989).13)
The services most often cited as having improved were s
adult education opportunities, and banking services. Respon
clearly believed that shopping conditions had improved (65 p
while few (7 percent) thought they had gotten worse. Nearly
(39 percent) thought adult education opportunities had impro
only a very few (4 percent) thought that they had gotten wor
one-third (34 percent) of the respondents indicated that ban
services had improved, and just over one-eighth (13 percent)
they had gotten worse.
A second group of services, health care services, oppor
entertainment and recreation, and police and fire protection
often cited as having improved over the five- year period.
fourth (28 percent) thought health care services had improve
one-fifth (21 percent) thought they had gotten worse. In the
both entertainment and recreation, and police and fire prote
one-fourth (26 percent) indicated they had improved, while a
tenth (11 and 9 percent respectively) thought they had gotte
Still less frequently cited as having improved during t
1984-89 were child care facilities, and the quality of schoo
child care facilities, over one-sixth (17 percent) indicated
improved. Since 1989, with the expansion of funds for child
welfare recipients, it is believed that child care facilitie
areas have expanded. Regarding the quality of schools, one-
(14.5 percent) indicated they had improved. By contrast, so
percent indicated the schools had gotten worse in the last f
Among the least improved, and most often cited as havin
worse during the five year period, were the financial condit
lenders, and the financial condition of area agribusiness fi
tenth (10 percent) thought the financial conditions of area
improved while nearly one-fourth (24 percent) thought they h
worse. Only 8 percent thought financial conditions of area
firms had improved, while a sizeable 55 percent thought they
worse. In short, two key financial or business sources for
operators and spouses were viewed most often as having deter
Not surprisingly, more than two-thirds of the responden
percent) indicated that the financial condition of farmers h
worse in the five years, and few (7 percent) thought it had
Farm operators and their spouses felt that the services of l
agribusiness were becoming less adequate at the very time th
to rely on them more.
If one adds to this picture the heavy reliance on off-f
employment by farm operators and spouses and their intention
increase their off-farm employment, one sees the enormous im
community economic vitality to farm families as well as othe
residents. Given these realities, it is difficult to imagin
strong farm sector can be maintained in Michigan without str
viable rural communities. One major challenge is to develop
strategies and approaches for increasing the strength of rur
communities and maintaining them in a viable condition.
Increasing Instability of Some Local Governmental Units
The elimination of federal revenue sharing in 1986, com
the rapid devaluation of agricultural land, resulted in a de
financial stability of rural local governments. The 1980s wi
uncoupling of the federal-local partnership with a correspon
in federal grants and aid to rural areas. The devaluation o
agricultural land reduced revenue flows to rural local gover
which have a heavy reliance on property taxes to fund the ra
services. The combined impact on local governments has been
and has introduced new instability to rural governmental jur
In addition, during the past five years the economic co
Michigan resulted in a decline in state financial support fo
governments. This decline has forced many rural governments
increase property taxes or reduce the quantity and quality o
provided to local residents. Many have found it necessary t
The disparity among counties has increased due to unequ
growth and state transfers. While state policies often assu
local communities have the same fiscal capacity, there exist
fiscal gap among counties. The growth in the tax base of co
measured by the state equalized value (SEV) has varied widel
from an actual decline of tax base for some to a rapid rate
for others (-6 percent to +72 percent for the period 1986-91
Lack of state financial support and slow growth rates i
property tax base have resulted in local units increasing th
tax burden on local residents and moving towards more regres
of financing services. There has been a shift to greater us
fees and service charges. These have increased the regressi
local tax systems. They also have affected the demand for s
diminishing the use of services by those least able to pay.
Apparent results from shifts in financing methods for g
services raise serious policy questions. How can "equity of
services be preserved? What are the consequences of moving
more regressive system for financing education, police and f
protection and other health and human services?
Considerations In Securing Economic Opportunities For Ru
Communities
The Rural Development Partnership Advisory Committee an
Michigan Rural Development Academy have addressed the array
matters that confront Michigan rural counties and communitie
can draw upon their insights, and those of others, concernin
that must be considered in improving the well-being of Michi
areas.
First, the Partnership and the Academy cited that the c
issues of size, distance and density distinguish rural areas
metro counterparts. Technological advances provide some new
opportunities to overcome present obstacles to economic grow
Organizational advances also provide new opportunities to ac
economies of scale or new economic opportunities that are be
reach of an individual community acting alone. Given the gr
diversity of situations in rural areas, we are challenged to
what technical and organizational arrangements will work, wh
under what circumstances. The organizational arrangements,
particularly multi-community approaches for economic develop
to hold significant potential.
Second, the two groups recognized that the nature of ru
presents a distinct quality of life, particularly related to
environmental surroundings. Environmental quality is increa
importance as a factor influencing where businesses locate a
stay. The challenge here is how to preserve a pleasant rura
environment while providing good jobs and the other benefits
economy. It means making new and improved applications of t
of reasonable and sustainable uses of resources that lead to
destructive exploitation, nor to sterile preservation.
Third, the Partnership and the Academy indicated that s
strategies are needed to induce faster job growth than popul
in rural areas. They added to this the need for increasing
school education levels among rural residents. They also su
targeting employment or entrepreneurship options that will r
capita income. The challenge here, similar to the challenge
technical and organizational arrangements, is to determine w
strategies will work, and where and under what conditions th
viable.
Fourth, the Partnership and Academy reminded us of the
diversity of the 61 rural counties of the state and the rura
of other counties not considered as rural, and the challenge
diversity presents. For a number of these counties, one of
being confronted is how to manage the growth that is occurri
maintaining a valued quality of life and more traditional re
For some others, shortage of job opportunities and economic
be challenging them to find any new business or entrepreneur
possibilities that are economically viable.
Fifth, they recognized that there is no single approach
size-fits-all formula for successful rural development. The
recognized the great importance of local initiative. They i
that the most effective solutions for a healthier, more econ
stable community lie within the community itself. Helping t
forth community leadership and assisting communities in work
plans for their economic future should be key ingredients in
state rural development strategy.
Sixth, communities must identify their strengths and li
and work toward a common vision. Communities must inform th
about their conditions, and the opportunities to build on th
strengths and minimize their limitations. Rural communities
benefit from developing a common vision among their resident
their collective future.
Many communities are now undertaking "strategic plannin
related "futuring activities" to develop a common vision, ag
goals, and plans to achieve them. The challenge here is how
both the technical help and support for strategic planning e
how to empower the current and emerging leadership to undert
implement such plans. Communities need to spend some additi
up front to make economic conditions better in the future.
Seventh, rural counties and communities will find it ad
to consider possibilities previously not considered or empha
may find it beneficial to consider new ways to grow their ow
enterprises. They may find they get greater returns from ef
retain and expand existing businesses than from trying to at
ones. They may find economical ways to provide services or
products that they now obtain from beyond their county. They
from exploring how to increase their business readiness for
domestic marketing, or even selective international marketin
Alternatively, rural communities may benefit from deter
ways retirees and retiree services can bring economic vitali
communities. A number of rural counties are experiencing an
new retirees. Those counties, and others, may be in positio
financially from enhancing the appeal of their locality and
and opportunities for retirees.
As an eighth item we could add the importance of giving
attention to the counties and communities in financial stres
Financial stress for counties and communities, where it occu
to disinvestment in physical and social infrastructure. The
disinvestment may occur in elementary and secondary educatio
education, social services, job training, recreation, librar
planning, road patrol, road and street maintenance, and othe
These particular examples are shared because we, and other c
have observed these disinvestments.
Disinvestment diminishes rural quality of life and redu
desirability of those places for business attraction and bus
retention and expansion. If reduced business and employment
opportunities result, they further impact governmental units
to provide physical and social infrastructure. The challeng
to determine how counties and communities can be helped to h
reverse this cycle.
Ninth, both the Partnership and the Academy supported t
that multi-community cooperation is essential to future rura
vitality. The rural challenges that low density and small c
size present will remain. Communities have in the past bene
cooperative ventures in providing police services, fire prot
maintenance, waste handling and other services. Some commun
gone well beyond this level, instituting cooperative relatio
rural economic development. These and other communities are
possible opportunities at the multi-county or regional level
require an even higher order of analysis and cooperation. T
here is to learn from these new cooperative arrangements and
determine their nature and effectiveness, and determine the
multi-community and regional situations in which they might
fruitfully. 16)
Broader partnerships are also required. The notion of
communities acting competitively toward others is giving way
of cooperation. Further, the notion that one governmental u
the necessary knowledge and funding to conduct rural develop
giving way to the idea of partnership.
As the Partnership and the Academy have stated, "...par
central.... No single entity, whether it be federal governm
agencies, private business, foundations or local people, has
wisdom and all the resources needed to bring the desired qua
to rural people."17)
Last, but by no means least, is the matter of rural pov
poverty in America is perceived to be mostly an urban proble
reality it is not. For both the nation and Michigan, nonmet
rates exceed those of metropolitan areas. 18)
Moreover, rural residents who are poor and who are on w
more likely than their urban counterparts to be among the wo
Lower wage rates, higher part-time, and part-year employment
the incomes of many rural residents cannot rise above the po
Less well understood is the fact that a disproportionat
of the nonmetro poor are children.19) Increasingly, the rur
households and the communities in which children reside are
difficult to lift themselves from poverty.
Persistent poverty has a devastating impact on the deve
human capital in rural families and communities. Rural chil
families and communities are needlessly placed "at risk" as
consequence of the changing economics of agriculture and oth
industries. Clearly there is an interplay between human nee
values, economic and noneconomic resources, and the viabilit
families, communities, and agriculture and other rural indus
Persistent poverty that affects the development and welfare
children, families and communities is an important issue to
through research, educational and other programs, and policy
ENDNOTES 1) Lynn Harvey is associate professor and Extension speci Department of Agricultural Economics; Colletta Moser is prof Extension specialist, Department of Agricultural Economics; Vlasin is professor and Extension specialist, Department of Development. Vlasin took responsibility for drawing togethe from the contributors and drafting the document. Robert Pig Corcoran Pigg, Research Assistants in the Department of Reso Development, assisted with Conference discussions and initia materials. Marilyn Aronoff, assistant professor of Sociolog advice and assistance.
2) This section draws heavily upon material presented by Vlasin entitled, "Rural Areas: Trends, Conditions and Implic MP/EDA News. Michigan Partnership for Economic Development, State University, Vol. 4, No. 1 Spring 1991, p. 4.
3) U.S. Bureau of the Census (1990), STF1A
See also:
"Michigan Rural Regions,"Michigan Rural Development Str
Book, Rural Development Partnership Committee, December, 199
Source: Michigan Department of Commerce; Rural Michigan: A
Rural Michigan Today, A Strategy for Tomorrow. Rural Develo
Partnership Committee, December, 1990. p. 3. Source: Mich
Department of Commerce.
4) Rural Michigan: A Profile.... p. 3.
5) Rural Michigan: A Profile.... p. 4.
6) Rural Michigan: A Profile.... p. 4.
7) Rural Michigan: A Profile.... p. 5.
8) Rural Michigan: A Profile.... p. 4.
9) Rural Michigan: A Profile.... p. 4.
10) Colletta H. Moser and Raymond D. Vlasin, "Results of t Regional Farm Survey: Michigan", Farm Family Adaptations to Economic Distress: Michigan. Michigan AES Project, August 19 5. p. 11. A random sample of 1,023 farms yielded returns fro operators and 319 spouses.
11) Colletta H. Moser and Raymond D. Vlasin, p. 15.
12) Observations by Lynn Harvey, concerning public service Michigan.
13) Colletta H. Moser and Raymond D. Vlasin, p. 15.
14) Colletta H. Moser and Raymond D. Vlasin, p. 15.
15) Rural Michigan: A Profile.... p. 6.
16) Research is underway on this topic under AES Project 3 "Cooperative Action Among Michigan Communities To Achieve Ec Advancement." Michigan State University team members includ Marilyn Aronoff and Raymond D. Vlasin, and Graduate Research Susan Corcoran Pigg, Tracy Dunbar, Robert Pigg, and Margaret Others who are assisting or have assisted are Professors Dan Chappelle, Lynn Harvey, and A. Alan Schmid, plus graduate as Valerie Gunter and Martha Sullins Way.
17) Rural Michigan: A Profile.... p. 2.
18) Janet L. Bokemeier, "Metropolitan/Nonmetropolitan Labo Areas in Michigan: Demographic Characteristics," Briefing on Census Results and Michigan Population: General Population Characteristics and Trends. 1992.
19) C. Rogers, The Economic Well-Being of Nonmetro Childr Development Research Report Number 82. Washington, DC: Econo Service, U.S. Department of Agriculture. 1991.
20) M. C. Clifford, M. M. Bubolz, and M. S. Sontag, Pape for "The Rural Family, The Rural Community and Economic Rest Conference. Sponsored by the North Central Regional Center f Development and the Iowa Council on Family Relations. April
21) J. G. Dryfoos, Adolescents at risk: Prevalence and pr New York: Oxford. 1990.