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You Decide: Where Will We Live?

By Dr. Mike Walden
North Carolina Cooperative Extension

dr michael waldenLess than 50 years ago – in 1970 – North Carolina was still a rural state. Over half (54 percent) of the state’s residents lived in rural areas. In fact, at that time only five states – Vermont, West Virginia, North Dakota, South Dakota, and Mississippi – had a higher percentage of their population living in rural counties.

That’s all changed. North Carolina is now an urban state, with two-thirds of the state’s people living in cities and high density counties. Urban areas are booming, while some rural counties have actually lost population in recent decades.

Some say this is the future, with people increasingly living in metropolitan regions where jobs, new industries and entertainment options are available. There are forecasts of over 80 percent of North Carolinians living in metro areas by mid-century. At the same time, these forecasts also predict 33 of the state’s 100 counties will have fewer people in 2050 than today.

There are several factors behind this reshuffling of where people live. The changing economy is a big part of it. The economic sectors in the state that have rapidly expanded – like pharmaceuticals, technology, instruments, finance and health care – have mainly been developed in urban areas where the big universities are located. The sectors need access to the high skilled talent graduated from the universities as well as the cutting-edged research conducted by the schools’ faculty.

The movement of young people to the state’s cities is another part of the explanation. With over 60 percent of North Carolina high school graduates going to college, and with the state’s big colleges and universities being primarily in urban regions, many talented rural youths end up moving to the cities after high school. And since the jobs as well as the shopping, restaurants, entertainment and lifestyle young folks want are in urban areas, college grads end up staying in the city and never returning home.

So a big reason for the growth of metro regions in North Carolina is their attractiveness – or “pull” – on people living in rural areas. But at the same time there has been a complementary “push” from changes in rural regions causing residents to consider moving to urban centers.

The biggest “push” has been the challenging economy in many rural areas. While globalization, the tech revolution and the ramping up of educational requirements have favored urban areas, they have hurt rural regions.  Many of the industries driving metro areas – such as technology – have benefitted from globalization with the opening of foreign markets increasing their sales.  Yet at the same time, globalization introduced foreign competitors for the textile, apparel and furniture industries largely located in rural regions – resulting in reduced sales and fewer jobs in our rural counties.

When the technology revolution began, many futurists predicted it would spark a rural revival as people tele-commuted and tele-worked, never having to leave their home in order to be productive. But guess what – just the opposite has occurred – with cites and urban areas growing faster during the information age. It turns out that as technology has expanded the number of acquaintances we can make at almost an exponential rate, many people – business persons, managers or just friends – still want face-to-face contact with a certain percentage of those acquaintances. And, face-to-face contacts are still easier to make in cities.

Also, as rural areas have lost their “best and brightest” to the big city lights, the decline of jobs, attractions and entertainment options motivate even young people without college aspirations to migrate to urban areas where the jobs and excitement exist.

So are the futurists correct – will the urban-rural divide continue to widen, leaving large swaths of North Carolina with no people and a limited future? The “smart money” probably says “yes”, but there are some potential game changers that could reverse the trend.

One would be a boom in rural-based industries, like agribusiness, tourism, retirement living and large scale manufacturing. A second would be rising costs in urban areas resulting from fast growth – costs such as housing prices and traffic congestion – causing some businesses and households to decide the city is too expensive and rural areas are preferable.

But maybe the most intriguing game-changer could be technology – technology that now favors rural locations. One innovation would be virtualization, whereby individuals could interact on a personal basis with others without being in the same location. The other is driverless transportation, which would mean long commutes from rural to urban areas could be used productively by the traveler.

Economic forces have caused North Carolina to become more of urban state, reversing its tradition of small town and rural living. Will it remain that way, or will the shifting tides ultimately cause a reversal? You decide!

Walden is a William Neal Reynolds Distinguished Professor and Extension Economist in the Department of Agricultural and Resource Economics at North Carolina State University who teaches and writes on personal finance, economic outlook, and public policy.

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