The national unemployment rate has plummeted to 4.9 percent, but in West Virginia, persistently high unemployment has been made worse by the deterioration of the coal industry.
The fall of coal has been surprisingly rapid.
“West Virginia’s average employees have slid from 24,724 in the final quarter of 2011 to 14,457 in the final quarter of 2015 — a loss of 41 percent of coal jobs. Kentucky has lost nearly 53 percent of its coal mining jobs in the same period,” according to a report from SNL Energy by Taylor Kuykendall and Hira Fawad.
Much of that loss has occurred recently. “Central Appalachia has lost 18.6 percent of its coal jobs since the end of 2014,” Tim Mandell of the Institute for Rural Journalism and Community Issues writes.
Southern West Virginia and eastern Kentucky comprise central Appalachia, and its struggle to diversify in its economy is reflective of the Appalachian region. West Virginia’s unemployment rate is 6.2 percent, 45th of the states and the District of Columbia. Its employment to population ratio is the lowest of all states at 49.4 percent, and it’s had the lowest ratio since the Bureau of Labor Statistics started tracking the figure in 1976.
Competition from natural gas that lowered energy prices, the slowdown of the Chinese economy, and federal regulations that favor natural gas and green energy have throttled demand for coal.
West Virginia state government has proposed lowering industry taxes, but the shifting energy market hurts more than state- and federal-level regulations and taxes. It’s unlikely that coal jobs will return, and in a region that needs less reliance on one industry for economic growth, that change hasn’t happened.
Nor have state or federal governments invested much into the region. The Appalachian Regional Commission was established in 1965 and funds projects for development, infrastructure, education, and health, but the region still lags behind the rest of the country.
That could change soon, however. President Obama’s 2017 budget requested $120 million for ARC, the largest boost for funding in decades. It’s unclear, however, whether that will come to fruition, and if it would boost the economy.
If it doesn’t, some sort of economic revitalization is needed.
“The number of jobs in the nation has jumped 83 percent since 1975, while the number of jobs in Appalachia has increased only 50 percent over the same time period. In addition, the Region’s labor force participation rate remains low (59.5 percent in the Region compared with 64.2 percent nationally),” ARC’s strategic plan notes.
There’s hope in federal prisons being built throughout the region, transitioning into renewable energy, or expanding health care offerings, but much of that has been ineffective or untried. And, as the Affordable Care Act favored large-scale hospital networks over smaller, rural hospitals, hospital closures could cap the expansion of health care services in some parts of Appalachia.
