MISSOURI'S INDUSTRIAL JOBS UP IN RURAL AREAS

ST. LOUIS -- A study of industrial job growth in Missouri and six other Midwest states by the Federal Reserve Bank points to increases in the state's rural areas and declining rates for metropolitan regions.

Among the seven states served by the 8th District Federal Reserve Bank, Missouri led its neighbors in industrial employment increases from 1984 through 1994.

The study, under the direction of economist Adam M. Zaretsky, provides a detailed analysis of where industrial jobs were created during the decadelong period as well as where losses have occurred. The biggest losers, the study found, are Missouri's four principal urban areas: St. Louis, Kansas City, St. Joseph and Springfield.

All of these metropolitan regions sustained industrial job losses, the greatest being St. Louis City, where the decline was 3.7 percent per year. Green County (Springfield) took the smallest loss for metropolitan employment, dipping 0.21 percent annually.

Twenty-two of the state's 114 counties registered annual industrial employment increases of at least 5 percent, with two counties -- Platte and Dallas -- recording more than 11 percent gains. Other counties in this category were Reynolds, Perry, Dent, Ralls, Gentry, Shelby, Shannon, Bates, Camden, Crawford, Barton, Andrew, Stone, Marion, Christian, Linn, Butler, Sullivan, Scotland and Ripley.

Forty-one non-metropolitan counties in the state had slightly smaller employment increase of 2 to 5 percent.

Nineteen of the state's 114 counties, including the urban areas, registered losses ranging from 5.02 percent (Maries) to 0.01 percent (Carter).

Zaretsky's analysis found that while large cities have attempted to revitalize their industrial sectors with tax breaks, infrastructure improvements and hiring incentives, Missouri's rural areas, with 40 percent of the population, have exceeded all but the nation's fastest growth areas.

The Federal Reserve economist also found that rural counties in Arkansas, Mississippi and Tennessee are especially manufacturing-intensive, with more than 20 percent of their employees working for these firms. On the other hand, Missouri, Illinois and Kentucky generally have average or below-average shares of manufacturing employment.

The St. Louis economist explained, "This north-south divide exists because southern states generally have less restrictive labor laws and lower labor costs than their northern neighbors."

Zaretsky said the differences have made southern states particularly attractive to firms looking to cut costs and improve efficiency, as increasingly fierce competition has evolved in domestic and foreign markets.

Despite the rural job gains in outstate Missouri, the federal bank study said a large gap still exists between urban and rural areas when considering per-capita income, even though recent rates of income growth have been about the same for both. "Rural areas, particularly in Arkansas, Mississippi and Tennessee, still have to deal with relatively high poverty rates," the economist said.

"At first glance, this would seem to indicate that much of the income growth in rural areas may have come from government payments to the poor," Zaretsky said. Between 1984 and 1994, per capita government payments, adjusted for inflation, grew about half a percentage point a year faster in each state's rural areas than in its urban areas. But the study found that by 1994, only 11 percent of all federal government transfer payments went to welfare programs while 70 percent went to Social Security and Medicare.

Rural areas have higher concentrations of people 65 and older than their urban counterparts. Zaretsky believes this probably benefits rural areas because senior citizens are willing to spend much of their income and accumulated wealth. In fact, he said, older citizens are actually some of the biggest spenders in today's economy.

The federal economist believes the next wave of development in rural areas in Missouri and the remainder of the bank's service region will likely come from telecommunications technologies. "The belief is that these new technologies will better link rural areas with other communities and their expertise, which should improve medical services, create new jobs and increase access to educational opportunities."

GROWTH RATE OF MANUFACTURING EMPLOYMENT

COUNTY -- AVG. GROWTH

Platte -- 11.90

Dallas -- 11.19

Reynolds -- 9.97

Perry -- 8.83

Gentry -- 7.39

Camden -- 7.05

Crawford -- 6.22

Butler -- 5.13

Daviess -- 4.77

Clay -- 3.59

Cole -- 3.52

Scott -- 3.35

Boone -- 3.05

Cape Girardeau -- 3.01

Johnson -- 2.96

Laclede -- 2.86

Madison -- 2.65

St. Francois -- 2.33

Nodaway -- 2.28

Lafayette -- 2.19

Franklin -- 2.04

New Madrid -- 1.87

Ste Genevieve -- 1.47

Jasper -- 1.20

St. Charles -- 1.17

Jefferson -- 1.02

Pettis -- 0.52

Gasconade -- -0.10

Greene -- -0.21

Harrison -- -0.57

Buchanan -- -0.64

Dunklin -- -0.73

St. Louis -- -1.04

Pemiscot -- -2.94

Jackson -- -3.06

St. Louis City -- -4.77

Mississippi -- -5.02