
          Economic Development
                  By Suitts, SteveSteve Suitts
          Vol. 2, No. 3, 1979, pp. 27
          
          While the South continues to show signs of rapid economic activity,
the rate of unemployment in the region, which has not been an
historically severe problem as in other regions, is suggesting that
economic problems are or may be ahead for Southern workers.
          Although unemployment in most 11 Southern_states dropped in the last years, the
decline has not always been as great as in the rest of the
country. While the rate of unemployment nationally dropped from 6.3
percent to 5.8 percent for the one-year period ending July 3 1, 1979,
the decline in Georgia was only from 5.8 percent. In Arkansas the
unemployment rate dropped only from 6.1 percent in July 1978, to 5.7
percent one year later.
          The most serious indications are that four Southern_states
Louisiana, Florida, Alabama, and Tennessee - continue to show
unemployment rates well above the national average (see map
above). For example, Louisiana's unemployment rate was 6.7 percent in
July and in Alabama the 7.9 percent unemployment rate was an increase
over the July 1978 percentage of 7.2 percent.
          The unemployment pattern in the South loosely resembles the
situation in the northeast and northcentral states, when the
unemployment figures in most states surround the national average with
a substantial number above the average ranging from 6.5 percent to
8.40 percent. Only two states west of the Mississippi River, however,
had unemployment rates in July 1979 above 6.5 percent. One was a
Southern state, Louisiana, and the other was Oregon. Throughout the
Midwest, unemployment rates in July were less than 4.5 percent.
          Since July of this year the national jobless rate has been hovering
around 6 percent. In August it went above 6 percent and in September
it dropped back to 5.8 percent. Recently the October unemployment rate
showed a major shift. Likewise, the rates in Southern_states appeared
to have maintained generally the same pattern that existed in
July.
          Historically, unemployment rates in Southern_states have been below
the national average. Explanations for the heightened rates of
unemployment often follow very much the same rationale for national
unemployment. The Southern economy, like the nation's, is suffering
from its fair share of layoffs and reduced production.
          There may be some historically unique factors to the Southern
pattern, however. U.S. Bureau of Census estimates the region is
gaining substantially in population. Combined with a national trend of
increased labor market participation by women and youth, the increased
number of workers may be reflected in the unemployment rates of the
South. Also, migration within the region from rural to urban locations
may also be a contributing factor since the work skills of the rural
place are not easily transferrable in urban settings.
          Some economists are also suggesting that the South's regional
economy remains largely undiversified with heavy emphasis on low wage
service industries and manufacturing. Hence, with frequent turnovers
of employment in these two industries, the South's rates of
unemployment is higher than in the past.
          By whatever combination, these factors may be rendering an even
greater problem of unemployment for the South than the Department of
Labor statistics indicate. In September the National Commission on
Unemployment Statistics reported that the government's method of
counting the unemployed and the definition of the "unemployed" may be
substantially undercounting the actual number of people who are
seeking jobs but unable to find them.
          In any event, the economic growth of the South with its increases
in population has not automatically reduced low levels of
unemployment. While the South may still lead the nation in rapid
economic growth and number of jobs available, the benefits of the boom
have not yet been seen by Southerners in the unemployment lines.
        
