BULLETIN 417 JUNE 1971 An Analysis of Income and Employment Changes in Four Rural Counties in Alabama, 1960-69 P -/ Agricultural Experiment Station Auburn, Alabama AUBURN E. V. Smith, Director UNIVERSITY CONTENTS Page 4----------- OBJECTIVES PROCEDURE4----------------------- AGGREGATE CHANGES IN SELECTED VARIABLES THE STUDY AREA7-------- IN Population Personal ------------------------- ----------- 7------ - 7 10 ---12 Incom e---- --- ---- Employment ------------------------- --THE SHIFT-SHARE MODEL------------- Growth Effects- 12 Mathematical Formulation----------------------------14 RESULTS OF SHIFT-SHARE ANALYSIS --------------------- 15 Incom e Effects ------------------------------------- 15 Em ploym ent Effects ----------------------- --------- 19 Combined Income and Employment Effects --.------------ 23 SUMMARY AND CONCLUSIONS ----------------------------- 23 A P P E N D IX ------------ -2 --------- - 8---------------- FIRST PRINTING 4M, JUNE 1971 An Analysis of Income and Employment Changes in Four Rural Counties in Alabama, 1960-69' WAYNE CURTIS 2 They are characterized by underemployment, unemployment, low income, and lagging economic development. In most of these areas, per capita income has consistently fallen behind state and national averages, while the rate of unemployment has risen above both averages. In recent years this has occurred during a period characterized by expanding national output, relatively high employment, and a generally rising level of living. Several studies in the past few years have focused on the problem of low income and underdevelopment in rural areas in the South. This research has stressed such important concerns as characteristics and distribution of population, levels of living, manpower, land values and tenure, income distribution, and natural resource use and development. Two recent regional research efforts involving Alabama have documented significant changes and trends among rural households in selected low-income areas of the South. The first of these undertakings, in 1960, centered on the accumulation of a substantial amount of descriptive material about various aspects of the low-income problem.3 This study involved the interviewing of the heads and homemakers of selected households in 30 lowincome counties in seven Southern States. A follow-up study in 1966 was concerned with the processes of development and mobility. 4 It involved reinterviewing the houseThis report represents partial results of Alabama's contribution to S-79, a study of rural development and the quality of life in the rural South. 2Assistant Professor, Department of Agricultural Economics and Rural Sociology. 2 Southern Regional Project S-44, "Factors in the Adjustment of Families and Individuals in Low-Income Rural Areas of the South." Southern Regional Project S-61, "Human Resource Development and Mobility in the South." MANY RURAL AREAS in the South are economically depressed. 4 ALABAMA AGRICULTURAL EXPERIMENT STATION holds included in the first study and demonstrated what had happened to these rural low-income families with respect to level of living, occupational change, and educational change. Four Alabama counties included in both studies were: Clarke, Fayette, Monroe, and Tallapoosa, see map. These counties were classified as rural and low income in both 1960 and 1966. Some of the data provided by these projects provided an opportunity to determine some key economic changes that have occurred in these four Alabama counties since the inception of the original project in 1960. Data on changes in levels of income and employment need to be ascertained, since this information was not directly obtained in either of the other studies. Also, key factors in overall economic development of any depressed area are income and employment opportunities. Perhaps even more important is the composition of income and employment and the extent to which industrialization has taken place. In addition, transformations that have occurred in the structure of the income and employment dimensions of the economy must also be identified if development of a viable economy is to occur. OBJECTIVES The overall objective of this study was to identify and analyze the structural transformation from 1960 through 1969 in economies of four selected rural Alabama counties in terms of the income and employment dimensions. Even though these counties are not adjoining, they were treated as a composite study area because they possessed comparable characteristics and were similarly aggregated in previous studies. Specific objectives of the study were: 1. To estimate aggregate changes that have occurred in selected variables in this four-county study area; 2. To isolate causes of any shifts in the income and employment variables through the use of shift-share analysis; and 3. To compare the relative economic performance of the selected counties with that of the State and the Nation. PROCEDURE Secondary data were used in this study to obtain county, state, and national shifts in key transformation variables. Secondary data were used because of the prohibitive time and cost necessary EMPLOYMENT CHANGES IN ALABAMA 5 Alabama counties included in low-income studies in 1960 and 1966. 6 ALABAMA AGRICULTURAL EXPERIMENT STATION for collection of primary data and because primary data were not available for many of the relationships depicted in the model. Most of the data used in the model were collected from census and other government publications. In cases where data were limited "best" estimates were used. Firms in the study area were aggregated into 10 sectors. The delineation of sectors basically followed the major grouping of industries as classified by the Bureau of Labor Statistics. This aggregation procedure was accomplished to reflect the structural relationships of these sectors as they apply to the study area. A brief description of the composition of each sector follows: 1. The agricultural sector includes all operations in the area engaged in agricultural production. Included are such firms as livestock, crop, and fruit or vegetable farms, and hatcheries, artificial inseminators, veterinarians, and others who provide service to farming operations on a contract or fee basis. 2. The mining sector includes those establishments in the area engaged in extraction of petroleum, sand, gravel, and clays. 3. The construction sector includes firms engaged in construction of buildings; special trade contractors engaged in specialized construction activities such as plumbing, painting, electrical work and carpentry; and general contractors. 4. The manufacturing sector includes those firms in the area engaged in food manufacturing; textile and apparel manufacture, printing and publishing; production of stone, clay, glass or concrete production; and firms involved in lumber and wood products, furniture and fixtures, and paper and allied products. 5. The transportation and public utilities sector includes all trucking and warehousing activities within the area, electrical companies, telephone companies, gas companies, radio and television stations, and water and sanitary services. 6. The wholesale and retail sector includes all wholesale and retail trade within the study area. 7. The finance, insurance, and real estate sector includes commercial banking establishments, security and commodity brokers, credit agencies, insurance agencies, and real estate agencies. 8. The services sector includes establishments such as hotels and other lodging places; establishments providing personal business, repair, and amusement services; and medical, legal, engineering and other professional and miscellaneous services. EMPLOYMENT CHANGES IN ALABAMA 7 9. The State and local government sector includes all economic activity originating from county, municipal, and State governments. 10. The Federal government sector includes all economic activity in the area originating from the Federal government. AGGREGATE CHANGES IN SELECTED VARIABLES IN THE STUDY AREA In order to conduct a study of an area, it is necessary to have knowledge of the social and economic conditions of that area. Ideally, data on such factors as population distribution, level and sources of personal income, and level and type of employment should be known before such a study is undertaken. Descriptive material presented here will also aid in formulating the shift-share model used later. Population The population in the study area was predominantly rural in 1960, Table 1. About a third of the people lived in areas classified as urban by the Bureau of the Census. Such population distribution was in sharp contrast to that of the State, which had become principally urban by 1960. By 1970 this distribution had not changed appreciably, but there were slight shifts toward urbanization in both the study area and in the State. Perhaps of greater importance is the fact that total population in the study area declined by approximately 1,600 people during the decade - slightly less than 2 per cent. Personal Income It is in the area of personal income that widest discrepancies between the study area and other areas appear. County per capita personal income estimates indicate that the study area lagged conTABLE 1. POPULATION CHANGES, URBAN AND RURAL, SELECTED AREAS, 1960-1970 Area1960 Urban Alabama Number.... Per cent---Study area Number.... Per cent---~1,791,721 54.8 33,843 I 34.1 Rural 1,475,019 45.2 65,422 65.9 Total Urban 1970 Rural Total 3,266,740 2,011,941 100.0 58.4 99,265 35,889 100.0 ~--I 36.4 Ir ~ ~ 1,432,224 3,444,165 100.0 41.6 61,810 63.6 97,699 100.0 8 TABLE 2. ALABAMA AGRICULTURAL EXPERIMENT STATION CHANGES IN PER CAPITA PERSONAL INCOME, UNITED STATES, ALABAMA, AND STUDY AREA, 1960-1969 Region 1960 Dol. 1969 Dol. 3,687 2,582 2,026 2,031 1,609 1,725 2,411 Change Pct. 66.5 76.4 82.4 86.5 82.8 71.8 85.0 United States Alabam a .---------------------------Study area Clarke County Fayette County Monroe County Tallapoosa County 2,215 1,464 1,111 1,089 880 1,004 1,303 Source: Survey of Current Business, August 1961 and August 1970, and Personal Income Supplement to Alabama Business, May 1963 and February 1971. siderably behind both the United States and Alabama in per capita income at both the beginning and end of the decade of the 1960's, Table 2. In 1960, for instance, per capita income in the four counties comprising the study area was approximately onehalf the national average and 76 per cent of that for Alabama. There were greater variations on a county basis, as Fayette County had a level of per capita income approximately 40 per cent of that for the Nation. Expansions of significant magnitude occurred in the study area from 1960 to 1989 as gains for the area as a whole outstripped those for Alabama and the Nation. In fact, only one county had a rate of increase in per capita income below the state level; but it was still greater than the national increase. On a relative percentage basis, gains in the study area were approximately 24 per cent greater than those for the Nation, and the level of per capita income was approximately 55 per cent of that for the Nation and about 80 per cent of that for the State. On an individual county basis, greater variations occurred. Total personal income in the four counties comprising the study area increased about 92 per cent from 1960 to 1969, Table 3. Of the major components of personal income, greatest percentage increase occurred in other labor income. Income changes of approximately 125 per cent occurred in property income and transfer payments, while the final and largest component of personal income, wage and salary disbursements, increased about 100 per cent. Within the wage and salary component, greatest increase was in the finance, insurance, and real estate sector. Firms in this sector paid out $3.8 million in wages and salaries in 1969 as con- EMPLOYMENT CHANGES IN ALABAMA TABLE 3. PERSONAL INCOME, BY MAJOR SOURCE, STUDY AREA, 9 1960 TO 1969 Change Source 1960 Thou. dol. Pet. 59.2 1.2 0 1.7 35.4 1.9 6.6 .9 2.3 3.6 5.4 3.2 18.3 7.6 10.7 9.7 11.9 2.3 100.0 1969 Thou. dol. 133,238 1,192 940 7,006 74,954 6,241 13,934 3,814 6,372 8,449 10,336 9,326 24,138 9,370 14,768 24,217 29,925 8,594 212,242 Pct. 62.8 .6 .4 3.3 35.3 2.9 6.6 1.8 3.0 4.0 4.9 4.4 11.4 4.4 7.0 11.4 14.1 4.0 100.0 1960 to 1969 Pct. 104.2 12.9 00 269.3 91.9 191.5 90.7 298.1 155.6 110.7 72.1 164.7 19.4 11.3 25.3 126.5 127.8 241.8 92.4 Wage and salary disbursements........... Agriculture .----------Mining Contract construction .------Manufacturing------Transportation and utilities .-----------Wholesale and retail trade---------------Finance, insurance, and real estate-----------Services--------------State and local government---------Federal government.......... Other labor income---------------Proprietors' income---------------Farm ................................... Nonfarm--------------Property income---------Transfer payments --------------Less: Personal contributions for Social Security---------Total------------------ 65,241 1,368 0 1,897 39,057 2,141 7,307 958 2,493 4,010 6,007 3,523 20,211 8,421 11,790 10,690 13,138 2,514 110,290 trasted with less than $1 million in 1960. Other rapid-growing components were contract construction, transportation and public utilities, services, and State and local government. Only the agricultural sector experienced a decline in wage and salary disbursements. The income distribution pattern also shifted during the period. Personal income attributable to proprietors decreased from 18 per cent of the total to 11 per cent, while transfer payments increased from 12 to 14 per cent of the total personal income distribution. Percentage of income generated by wage and salary payments by the Federal government decreased slightly, as did agriculture. Small increases occurred in finance, insurance, and real estate and services. For the remaining income sources, total contribution of each appeared stabilized at 1960 levels. Total personal income during the period increased at a greater rate in the study area than in either Alabama or the United States, Table 4. Growth rates for the study area were higher than those for Alabama and the United States in four of the five major 10 ALABAMA AGRICULTURAL EXPERIMENT STATION 10 TABLE ALABAMA AGRICULTURLEPIMN 4. CHANGES IN INCOME, BY SOURCE, UNITED STATES, STIO ALABAMA, AND STUDY AREA, 1960 TO 1969 Source Changes in income, 1960 to 1970 Study area United States Alabama Pct. Wage and salary disbursements Agriculture ---------Mining __________ Contract construction Manufacturing-- -Transportation and utilities Wholesale and retail trade Finance, insurance, and real Services --- -- --- -- -- --- -- -State and local government------Federal government------------Other industries---------------Other labor income---------------Proprietors' income---------------Farm - - - -- - - - - - - - - - - - - - - - - - - - Nonfarm ---------- -----------Property incom e----------- ------Transfer payments---------------Less : Personal contributions for Social Security-------- ------T ota l -- - - - - - - - - - - - - - - - - - - - - - -87.6 1.2 40.5 96.1 80.2 64.4 68.1 97.2 123.9 134.2 120.5 57.3 150.1 44.6 363.2 47.5 102.8 120.8 182.3 86.6 Pct. 92.8 17.6 -9.1 102.4 106.5 64.6 74.6 75.2 130.8 122.6 Pct. 104.2 -12.9 00 estate 75.8 160.0 160.8 32.8 269.3 91.9 191.5 90.7 298.1 155.6 110.7 72.1 164.7 19.4 11.3 25.3 126.5 127.8 241.8 92.4 45.8 26.6 126.3 123.1 165.6 90.4 sources of personal income - only in the proprietor income did study area growth rates lag. Widest discrepancies among the personal income sources occurred in wage and salary disbursements, especially in finance, insurance, and real estate, contract construction, and transportation and public utilities. In each of these sectors, growth rates for the study area were much greater than those for the other two areas. It is noteworthy that wage and salary payments from agriculture in the study area changed at a negative rate during this time period and also that the growth in farm proprietor income was substantially less in the study area than in the State or Nation. This, coupled with the large increases in the financial services, public utility, and construction sectors, seems to indicate a growing rate of industrialization in the four rural counties from 1969 to 1969. County income data are presented in detail in Appendix Tables 5 through 8. Employment Total employment in the study area increased 22.5 per cent from 1960 to 1969, Table 5. Greatest percentage changes occurred EMPLOYMENT CHANGES IN ALABAMA TABLE 11 SECTOR, STUDY AREA, 5. EMPLOYMENT, BY MAJOR 1960-1969 Sector No. Agriculture---------------------------M ining-----------------------Contract construction Manufacturing -----_---------- 1960 Pct. 15.8 0 2.4 52.6 1969 No. 2,800 100 1,340 16,960 Change 1960 to 1969 Pct. 8.7 .3 4.2 52.6 Pct. 32.4 00 111.0 22.5 4,140 0 635 13,850 Transportation and public Wholesale and retail trade.------Finance, insurance and real estate-- utilities_ 605 2.3 650 2.0 7.4 3,055 285 1,335 11.6 1.1 5.1 3,720 560 2,020 11.5 1.7 6.3 21.8 96.5 51.3 Services ----------------------State and local government------Federal government ------------- 1,020 26,330 1,405 5.3 3.9 2,920 1,180 9.1 3.7 107.8 15.7 Total ---------------------- 100.0 32,250 100.0 22.5 in the contract construction, State and local government, and finance, insurance, and real estate sectors. Only in agriculture did employment decline. Changes occurring in each county are pre- sented in Appendix Tables 11-14. Of perhaps greater importance, however, were the shifts in distribution of employment from 1960 to 1969. Greatest shift in the study area was out of agriculture and into services, State and local government, and contract construction. Employment distribution in most other sectors appeared to be stabilized at 1960 levels. During the same time period, total employment ini the United States and Alabama increased 23.8 and 21.9 per cent, respectively, Table 6. With respect to other areas, the study area experienced TABLE 6. CHANGES IN ALABAMA. AND EMPLOYMENT, STUDY BY SECTOR, UNITED AREA. 1960 TO 1969 STATES, Sector- Changes in employment, 1960 to 1969 Alabama r Study area United States Pct. Pct. Pct. 00 Agriculture Contract M in g construction in Transportation ------------------------ -- - - - - - - - - - - - - - - - - - - - - - - - - -- M anufacturing---------------- ------__________ and Wholesale and retail insurance, and real utilities trade Finance, estate S e rvice s - - - - - - - - - - - - - - - - - - - - - - - - - - State and local Federal government-T otal -- - - - - - - - - - government ----------- -33.9 -13.1 19.1 20.1 10.7 28.6 33.3 51.0 55.3 21.5 23.8 -32.0 -38.5 19.4 33.8 12.0 25.0 26.8 41.7 53.1 -7.5 21.9 -32.4 111.0 22.5 7.4 21.8 96.5 51.3 107.8 15.7 22.5 12 ALABAMA AGRICULTURAL EXPERIMENT STATION larger employment gains in the construction, State and local government, services, and finance, insurance, and real estate sectors. Manufacturing employment grew at a faster rate in the study area than in the United States, but less than in Alabama. By most standards, the four-county study area was economically depressed in 1960 and, to some extent, in 1969. In 1960, most of the population lived in rural areas and the per capita income lagged behind both national and state levels. During the period, however, per capita income grew at a faster rate than was true of the other two areas. Total personal income also increased by a greater percentage in the study area. Employment increased approximately 22 per cent while population declined almost 2 per cent. Since income and employment are such vital factors in overall economic development of an area, some means of quantitatively assessing changes in both factors must be developed. If these shifts in income and employment can be isolated, they partly explain structural transformations in the economy and provide possible insight into the future direction of development and change in the economy. One technique for isolating the various factors associated with income and employment changes is through use of the shift-share model. THE SHIFT-SHARE MODEL 5 Growth Effects One means of identifying factors underlying changes in income and employment in the study area is through use of shift-share analysis. This technique is used to separate an area's income and employment growth into three factors and measures the contribution of each. Although it does not provide basic answers to changes in composition of income and employment, shift-share analysis does provide a useful framework for tracing causes and effects of such trends. The initial step in identifying factors responsible for variations in income and employment changes is to dissect the total growth increment into three effects: national-growth, industrial-mix, and regional-share. 6 For a detailed discussion of the practical and theoretical concepts involved in shift-share analysis, see Survey of Current Business, August 1970. EMPLOYMENT CHANGES IN ALABAMA 13 National-Growth Effect The national-growth effect measures overall growth of the national economy. This effect is calculated by applying to each income or employment component in the base year (1960) the percentage change in total income or employment between the base year and the terminal year (1969). The national effect must be isolated in order to focus on the two remaining effects which account for differences in regional-growth patterns. Industrial-Mix Effect The industrial-mix effect, called the component-mix effect when referring to income changes, results from differences between income and employment structure of an area and of the Nation. For example, if a large proportion of an area's economy consists of industries that are growing slowly nationally, that area's employment might expand at a below-average rate even though each employment source in the area was increasing at a rate above the national average. The reverse would also hold true. The component- or industrial-mix effect is estimated by applying to each income or employment component in the base year the difference between the national growth rate for that component and the overall or average national growth rate. If the former is larger, the particular income component is a rapidgrowth component. Its presence in the economy gives rise to area growth; the size of the increase will vary according to the relative proportion of the component located in the area. On the other hand, where the component growth rate is less than the overall national rate, it is termed a slow-growth component and it has a negative effect on income and employment. Again, this effect is a relative one. Regional-Share Effect The third element of an area's growth is the regional-share effect, which also is the second factor accounting for differential change between an area and the Nation. This element is calculated by applying to each income or employment component in the base year the difference between the percentage change in that component in the area and percentage change in the same component nationally. The regional-share effect tells something of the competitive position of an area in relation to the rest of the Nation. For instance, an employment component that is growing faster in an 14 ALABAMA AGRICULTURAL EXPERIMENT STATION area than its counterparts in the Nation as a whole will add to the area's overall growth relative to that of the Nation, while a slowergrowing component will bring forth an opposite effect. That is, a positive difference signifies a shift of the particular component into the area; a negative difference indicates a shift out of the area. Mathematical Formulation Shift-share analysis can be stated mathematically in the following terms: m n (1) Xi = i=1 j= 1 (2) axij = X00 oo (Xi t -- (3) (4) (5) roo rij = (Xoot (Xot (Xij t Xio) Xoo o) X10 rio = = 0) Xoo o Xo ° Xij° - Xij o) ° (6) AX, = [(Xijo) [(Xi0o) (rio - (roo)] roo)] - [(Xijo) (rij- rio)] where Xij = employment or income component i in area j Xj ° = employment or income component i in area j at an initial time point, o Xij t = employment or income component i in area j at a terminal time point, t Xoo = national or aggregate employment or income in all components Xio -= national or aggregate employment or income in component i roo rio rij national-growth effect = industrial-mix effect = regional-share effect = EMPLOYMENT CHANGES IN ALABAMA 15 RESULTS OF SHIFT-SHARE ANALYSIS Income Effects National-Growth Effect The national-growth effect accounted for about 94 per cent of the total increase in personal income in the four-county study area during the period 1960-1969, Table 7. During the same time period, national growth explained about 96 per cent of the total change in personal income in Alabama. This is to say that, if firms in Alabama and the study area counties had experienced changes in income at the same rate as the Nation as a whole, 96 and 94 per cent, respectively, of the total change would have been accounted for. The national-income effect varied on a county basis from a low of about 80 per cent in Clarke County, the fastest-growing county in the area, to a high of 118 per cent in Monroe County, the slowest-growing county. Component-Mix Effect The component-mix effect did not explain a large percentage of the change in income in the study area counties, accounting for about 3 per cent of the change or approximately $3.1 million. The effect was negative in the study area. This can be interpreted to mean that the study area's mix of income-producing activities was composed more of the slow-growing components nationally rather than the rapid-growing ones. Fast-growing income components of the national economy were: other labor income, State and local government, services, transfer payments, Federal government, property income, finance, insurance, and real estate, and contract construction. The negative impact of the component-mix effect varied from less than 1 per cent to about 8 per cent in the individual counties comprising the study area. Regional-Share Effect Regional-share effect is the main explanatory factor in differentiating area income growth. It also follows that primary emphasis should be placed on the regional-share effect in projecting area growth. In economic analysis, the regional-share effect is generally regarded as an indicator of the competitive position of a given 16 ALABAMA AGRICULTURAL EXPERIMENT STATION geographic area in comparison with other areas. This is true because the regional-share effect compares the performances of an industrial sector in a given area with that of the same industrial sector in other areas. A positive regional share effect indicates a gain in the competitive position of an industry in relation to other similar industries in other areas, while a negative effect signifies the opposite. For Alabama, the regional-share effect accounted for 2.5 per cent of total personal income growth during the study period or approximately $105 million in additional income, Table 7. Thus, the competitive position of Alabama with respect to other states and regions was enhanced by this amount. Greatest regional-share impact occurred in the manufacturing sector as there was an increase of $258 million attributed to the improved competitive position of manufacturing in the State, Appendix Table 15. Second largest gains occurred in property or rental income $106 million. Primary losses were in Federal government wages and salaries and nonfarm proprietor income. Growth rates in both lagged behind the national norm. The composite regional-share effect accounted for about 9 per cent of the total income change in the study area or $9.6 million. As was true for Alabama, greatest impact was in the manufacturing sector, Appendix Table 16. Income generated by manufacturing firms in the four-county study area grew at a more rapid rate than like firms did nationally, adding $4.6 million to the competitive position of this sector. During the decade, shifts in manufacturing accounted for an additional $35 million in total wages and salaries. Wage and salary disbursements from the construction sector were the second largest regional-share effect accounting for about $3.3 million. Other income components having large regional-share shifts were wages and salaries in the transportation and public utilities sector and property income, each of which accounted for over $2.5 million. Negative regional-share effects occurred in Federal government wage and salary disbursements, nonfarm proprietor income, and farm proprietor income. Growth rates in each of these components failed to maintain the national rate. By far the largest regional-share income effect occurred in Clarke County, Table 7. This is to say that, of counties in the EMPLOYMENT CHANGES IN ALABAMA 17 study area, Clarke County made the greatest comparative advances in improving its overall competitive position in personal income. The aggregate effect of the improved competitive position was to increase personal income by some $7 million at the expense of other areas and regions, Appendix Table 17. Shifts in wage and salary disbursements in manufacturing accounted for more than half the net regional-share effect, $3.9 million. Other major components contributing to this effect were State and local government and finance, insurance, and real estate. Negative regional-share growth occurred in farm proprietor income, nonfarm proprietor income, services, contract construction and wholesale and retail trade. Each of these components failed to achieve the growth rate for its national counterpart. Regional-share shifts in personal income in Fayette County accounted for almost 11 per cent of the total income change during the period under analysis, Table 7. Increases in wages and salaries originating from the manufacturing sector were the dominant regional-share effect, Appendix Table 18. Other noteworthy increases occurred in wholesale and retail trade and farm proprietor income, both of which increased at rates higher than the national rate for each. TABLE 7. INCOME AND COMPONENTS OF INCOME SELECTED AREAS, 1960-1969 CHANGES, Area Total income change Income growth factors National growth Com- Regional Nee relative shae ponent mix shar change Thou. dol. United States Alabama Study area Clarke County....... Fayette County...... Monroe County...... Tallapoosa County.... 399,028,000 4,327,000 101,952 30,516 13,718 16,490 41,228 Thou. dol. hou. Thou. Thou. 0 399,028,000 4,143,000 81,000 95,510 -3,136 24,265 -770 12,305 -41 19,441 -1,332 39,498 -992 0 0 105,000 186,000 9,599 6,463 7,030 6,260 1,457 1,416 -1,616 -2,948 2,719 1,727 Per cent distribution of income change 0 0 0 100.00 100.0 United States 1.9 2.5 4.4 100.00 95.6 Alabama -3.1 9.4 6.3 100.00 93.7 Study area 79.5 -2.5 23.0 20.5 Clarke County....... 100.00 89.7 -.3 10.6 10.3 Fayette County...... 100.00 Monroe County...... 100.00 117.9 -8.1 -9.8 -17.9 95.8 -2.4 6.6 4.2 Tallapoosa County.... 100.00 1 Net relative change refers to the combined component-mix and regional-share effects. The combined effect is used in this manner throughout the study. 18 ALABAMA AGRICULTURAL EXPERIMENT STATION Largest regional-share decreases occurred in wages and salaries paid by government, both State and local and Federal. Other negative effects were in services and nonfarm proprietor income. Monroe County was the only county in the study area to have a negative regional-share effect, Table 7. Of the total income change in the county, a negative $1.6 million or 9.8 per cent was attributed to a declining overall competitive position with regard to the rest of the Nation. The overall rate of income change in Monroe County of 73.5 per cent was well below the national increase of 86.6 per cent. The composite pattern of income shifts in Monroe County is presented in Appendix Table 19. In contrast to Clarke and Fayette counties, the manufacturing sector did not maintain its competitive position during the period and contributed a large amount toward the regional-share deficit. Greatest negative effect, however, occurred in the Federal government sector. Even though income components failed to keep pace with their national counterparts, there were some bright spots in the Monroe County economy. Contract construction grew at a rate of 740 per cent during the period, accounting for a regional-share impact of $2.2 million, and transportation and public utilities wages and salaries increased some sixfold. Wholesale and retail trade finance, insurance, and real estate also contributed positive regional-share growth rates. The regional-share income pattern exhibited in Tallapoosa County differed from the other counties in the study area. Although the regional share effect accounted for almost 7 per cent of the aggregate income change, the components contributing to $2.9 million regional-share increase differed from those found in the other counties, Appendix Table 20. For instance, the greatest effect was in property income - $1.6 million. This was followed by wage and salary disbursements from the services sector, which had been negative in Fayette and Clarke counties. Large contributions were also made by increased wage and salary payments from the construction and wholesale and retail sectors. Greatest negative shifts occurred in manufacturing which, although total wages and salaries increased, accounted for -$1.1 million. Nonfarm proprietor income also had a negative regionalshare effect, as did Federal government wage and salary payments. EMPLOYMENT CHANGES IN ALABAMA 19 Employment Effects National-Growth Effect On the average, the national-growth effect accounted for more than 100 per cent of the total employment change in Alabama and the study area during the period 1960-1969, Table 8. On an individual county basis, this effect ranged from about 67 per cent in Clarke County (the fastest-growing area) to 188 per cent in Tallapoosa County (the slowest-growing area). The dominance of the national-growth effect reflects the fact that the economy of the United States is really a single entity made up of highly interrelated subeconomies. Each of these subeconomies specializes in the production of goods or services in which it has a comparative advantage. Since the major markets for these goods usually lie elsewhere, changes in economic growth in one area are transmitted in large measure to other areas of the Nation. Industrial-Mix Effect During the decade of 1960-1969, industrial-mix effect played only a small role in explaining the change in employment in Alabama and this effect was negative. As can be seen from Table 8, component mix accounted for about 6 per cent of the growth in employment in Alabama during this time period. That is, changTABLE 8. EMPLOYMENT AND COMPONENTS OF EMPLOYMENT CHANGES, SELECTED AREAS, 1960-1969 growth factors Indus- Area TotalEmployment National employment growth change trial Net Regional relative sha No. United States 14,187,000 No. 0 No. 0 No. 0 No. 0 Alabama Study area Clarke County-....... Fayette County...... Monroe County-...... Tallapoosa County-... 190,000 206,845 -11,190 -4,955 -16,145 -341 1,713 6,266 -2,054 5,920 660 1,116 1,312 -456 1,970 785 314 780 -471 1,090 639 -43 1,193 -682 1,150 -1,409 3,011 -406 -1,003 1,600 Per cent distribution of employment change United States -100.0 Alabama Study area Clarke County-....... Fayette County-...... Monroe County...... Tallapoosa County.... 100.0 100.0 100.0 100.0 100.0 100.0 100.0 108.9 105.8 66.6 71.6 103.7 188.2 0 -5.9 -84.7 -23.1 -43.2 -59.3 -25.4 0 -2.7 28.9 56.6 72.0 55.6 -62.7 0 -8.6 -5.8 33.5 28.8 -3.7 -88.1 20 ALABAMA AGRICULTURAL EXPERIMENT STATION ing industrial-mix in Alabama accounted for approximately 11,000 jobs. Nationwide, five employment components grew faster than the national employment average during this period. They tended to contribute to a positive industrial-mix effect. Included in these fast growing components were the following sectors: State and local government; services; finance, insurance, and real estate; and wholesale and retail trade. The six slow growing national employment components contributed to a negative industrial-mix effect in Alabama and the four-county study area. These were: Federal government, manufacturing, contract construction, transportation and public utilities, mining, and agriculture. The large declines in employment in mining and agriculture tended to contribute heavily to the negative effect in Alabama. In the study area, the industrial-mix effect played a greater role than on the State level. Much of the expansion that occurred in this area was in sectors that were expanding at a rate less than the national average. That is, most of the increases in employment occurred in slow-growing national industries. For instance, the fastest-growing industry in the study area was contract construction which was a slow-growing component nationally. On an individual county basis, the impact of industrial mix on total employment growth varied from a minus 23 to a minus 59 per cent. Again this was primarily caused by greater relative growth in industries in the study area that were slow-growing industries nationally. That is, a greater relative proportion of the industries in the four-county area was composed of slow-growing national industries. Regional-Share Effects As was mentioned previously, regional-share is the primary factor explaining differential growth rates of various regions or areas. Therefore, any discussion of shift-share analysis should be devoted primarily to regional-share effects. For Alabama as a whole, the regional-share effect accounted for a negative 2.7 per cent of the total employment growth in the State from 1960 to 1969 or a loss of approximately 5,000 jobs because of a declining overall competitive position with regard to other states. Primary losses in the regional-share effect were in the Federal government, services, wholesale and retail, and mining EMPLOYMENT CHANGES IN ALABAMA 21 sectors, Appendix Table 21. In the Federal government and mining sectors, there were actual declines in employment, but there were large increases in the other two sectors. Employment in services increased approximately 40 per cent and wholesale and retail trade about 25 per cent, but these increases were less than the national average. Thus, increases in Alabama, though large, were not of the same magnitude as the national increases. The only industrial components accounting for positive regional-share effects were in the manufacturing and agricultural sectors. The rate of growth of manufacturing employment increased about 34 per cent in Alabama during the period under analysis and only 20 per cent nationally. Thus, Alabama's competitive position as far as employment in manufacturing was concerned was greatly enhanced, and approximately 32,000 jobs in manufacturing were gained at the expense of other areas. In agriculture, on the other hand, there was a positive regional-share employment effect because the rate of decline in agricultural employment was almost 2 per cent less than that for the Nation. The aggregate regional-share effect for the study area was positive. Almost 29 per cent of the total change in employment in the counties under study was attributed to an increased share of total employment relative to other areas. Greatest regional-share employment gains for the area as a whole occurred in the State and local government, contract construction, and manufacturing sectors, Appendix Table 22. Of these, the contract construction sector expanded employment at a rate almost six times the national average, while employment by State and local government agencies increased at about twice the national average. Negative effects occurred in the wholesale and retail trade, Federal government, and transportation and public utilities sector. Overall, positive gains occurred in each sector from 1960 to 1969, but they were less than the national average for each. Thus, the competitive position of these sectors in the study area was diminished. From Table 8, it can be seen that regional-share accounted for a large proportion of the total employment change in Clarke County during the period under analysis. Employment shifts for this county are presented in detail in Appendix Table 23. Greatest regional-share impact occurred in the manufacturing sector of the Clarke County economy from 1960 to 1969, as manufacturing employment increased at a rate of slightly more than 4 22 ALABAMA AGRICULTURAL EXPERIMENT STATION per cent per year. Approximately 538 of the 840-job increase was a result of the regional-share effect. This was accomplished concurrently with an increase in contract construction and State and local government employment. To a lesser degree, there were increases in the Federal government and finance, insurance and real estate sectors. The only appreciable decrease in regional-share employment came in wholesale and retail trade. Although there was a net increase of almost 200 jobs in this sector, the rate of expansion was slightly less than the national average. Thus, the county lost 63 jobs on a regional-share basis. The greatest regional-share effect in the study area occurred in Fayette County, Table 8. The competitive position of employment with respect to other areas in the Nation was greatly enhanced as approximately 72 per cent of the total change in employment in the county was accounted for by regional shifts. Approximately 785 of the 1,090 additional jobs resulted from these shifts. Appendix Table 24 gives insight into the composition of these regional shifts. Positive changes occurred in all sectors except wholesale and retail trade, services, and Federal government. Manufacturing industries in the county accounted for the greatest regional share gain with employment in manufacturing almost doubling during the 1960 decade. In fact, approximately 93 per cent of the total regional-share gain was attributed to increases in employment in this sector. The regional-share employment effect in Monroe County closely approximated that of Clarke and Fayette counties, Table 8. Greatest regional impacts were in the manufacturing and contract construction sectors. Expansion rates in employment in both sectors greatly exceeded the national rates; in fact, the expansion rate in construction employment was 10 times greater than the national average, Appendix Table 25. Negative effects were present only in the two government sectors. Tallapoosa County represented somewhat of a paradox. The competitive position of employment declined drastically; approximately a negative 63 per cent of the total employment growth in the county was attributed to regional-share losses, Table 8. Largest loss attributable to regional share occurred in the manufacturing sector, Appendix Table 26. Growth in manufacturing EMPLOYMENT CHANGES IN ALABAMA 23 industries in the county during the decade of the 1960's was stagnated - increasing only about 4 per cent during the entire period. This accounted for a regional-share loss in employment of almost 1,400 jobs. Other industrial sectors in the county experiencing regionalshare losses were wholesale and retail trade and transportation and public utilities. The former showed an overall employment increase during the period while the latter experienced a decline in total employment, the reason for which is not readily apparent. State and local government and contract construction were the primary sectors having positive regional-share effects. Combined Income and Employment Effects Combined or aggregated income and employment changes in the study area are presented in Table 9. Total income change approximated $102 million while employment increased by 5,920. Of the aggregate income change, $95.6 million was attributed to the national-growth effect, -$3.1 million to the component-mix effect, and $9.6 million to the regional-share effect. The net relative change in income was $6.4 million. This indicates that, relattive to other areas and regions, income increased some $6.4 million more than that required to keep pace with the national change in personal income. Employment increases, on the other hand, amounted to 6,226, -2,054, and 1,713 for the national-growth, industrial-mix, and regional-share effects, respectively. The net relative change was -341, indicating that an additional 341 more jobs would have been created if the study area had kept pace with the rest of the Nation in employment changes. Overall, the study area appears to have made considerable progress in increasing income and employment, especially in personal income. When it is considered that employment in the area increased by 5,920 while at the same time population decreased by 1,600, then it could also be said that considerable progress has been made in this key variable. Positive regional-share effect in both income and employment indicate an increasing competitive position in each. SUMMARY AND CONCLUSIONS The overall purpose of this study was to ascertain the changes that have occurred during the past 10 years in the economic struc- TABLE 9. COMBINED INCOME AND EMPLOYMENT CHANGES, STUDY AREA, 1960 TO 1969 Area Total changeGrowth National growth Totalrchange EmployIncome mpyIncome Employment ment factors Net relative change Regional share Component mix IncomeEment-Income Eply Income Emplnt Epomly-m ment etmn Thou. dol. No. Thou. dal. No. Thou. dol. No. -2,054 -456 Thou. dol. 9,559 7,030 No. 1,713 1,116 Thou. dol. 6,463 6,260 No. -341 660 101,952 5,920 Study area_________________________________ 1,970 30,516 Clarke County 1,090 Fayette County________________--_ 13,718 Monroe Tallapoosa County..---------County________. 95,510 6,266 -770 1,312 24,265 ---------------------- -3,136 -41 780 12,305 16,490 -471 -682 1,457 -1,616 785 -1,003 639 1,416 -2,948 314 -1,409 M -43 41,228 1,150 1,600 19,441 39,498 1,193 3,011 -1,332 -992 -406 2,719 1,727 x -i -I ZI EMPLOYMENT CHANGES IN ALABAMA 25 ture of four rural counties in Alabama - Clarke, Fayette, Monroe, and Tallapoosa. Data for the study were assembled from numerous secondary sources, and all firms in the area were aggregated into 10 sectors based on the Bureau of Labor Statistics classification scheme. Counties in the area were classified as predominantly rural in both the 1960 and 1970 censuses. About one-third of the population lived in urban areas during both time periods. In addition, total population in the area declined by about 1,600 people from 1960 to 1970. Significant changes occurred in both per capita and total personal income in the study area from 1960 to 1969. Per capita personal income grew at a rate of about 82 per cent, contrasted with a growth rate of only 66 per cent nationally and 76 per cent statewide. Clarke County, with an 86 per cent increase, was the fastest-growing county in the study area. Total personal income, on the other hand, increased approximately 92 per cent in the study area, contrasted with an 86 per cent increase for the United States and a 90 per cent increase for Alabama. Four of the five major sources of personal income changed at greater rates than did their national or state counterparts. Wages and salaries experienced the greatest increase, 104 per cent; and within this component greatest increase was in the finance, insurance, and real estate sector. Only the agricultural sector experienced a decline in wage and salary disbursements; additionally, the change in farm proprietor income was substantially less in the study area than in the State or Nation. This - coupled with the large increases in the financial services, public utility, and construction sectors - seems to indicate a growing rate of industrialization in the study area. That the four counties in the study area had become more industrialized is borne out by sectoral employment data. Total employment increased approximately 22.5 per cent. Greatest percentage changes occurred in the contract construction, State and local government, and finance, insurance, and real estate sectors. Only in agriculture did employment decline. Greatest employment shifts from agriculture were into services, State and local government, and contract construction. Employment in most other sectors appeared stabilized at 1960 levels. With regard to the United States and Alabama, the four-county area experienced larger employment gains in construction, State 26 ALABAMA AGRICULTURAL EXPERIMENT STATION and local government, services, and financial sectors. Increases in construction activity caused employment in this sector to be significantly higher than in the other two areas. Employment in manufacturing grew at a faster rate in the study area than in the United States, but less than in Alabama. In an attempt to identify the factors underlying changes in income and employment, shift-share analysis was used. Using this technique, an area's income and employment growth can be separated into three factors: national-growth effect, industrial- or component-mix effect, and regional-share effect. The nationalgrowth effect measures the growth of an area in terms of the national economy, while the industrial- or component-mix effect results from differences between the income or employment structure of an area and the Nation. The regional-share effect is a measure of the competitive position of an area with regard to the rest of the Nation. The results of the shift-share analysis of income changes indicated that the national-growth effect accounted for approximately 94 per cent of the increase in personal income in the study area, while component mix-effect accounted for a minus 3 per cent and regional-share 9 per cent. Thus, a net relative change in personal income of 6 per cent occurred in the study area contrasted with a change of 2.5 per cent for Alabama. Regional-share is the main explanatory factor in differentiating area income growth, and in economic analysis it is generally regarded as an indicator of the competitive position of a given geographic area relative to other areas. The composite regional-share effect for the study area accounted for about 9 per cent of total income change or $9.6 million between 1960 and 1969. Greatest regional-share impact was in the manufacturing sector; wage and salary disbursements generated by manufacturing firms grew at a rate surpassing like firms nationally, adding approximately $4.6 million to the competitive position of this sector. Second largest regional share effects occurred in wage and salary disbursements by the construction sector. This was followed by wages and salaries from the transportation and public utilities sector and by property income. Large negative effects occurred in Federal government, nonfarm proprietor income, and farm proprietor income. Shift-share analysis of employment changes indicated that the national-growth effect accounted for approximately 106 per cent of total employment change. This indicates that employment in EMPLOYMENT CHANGES IN ALABAMA 27 EMrPLOYMENT CHANGES IN ALABAMA 2 the study area increased at a rate below that of the Nation. At the same time, the industrial-mix effect accounted for a minus 35 per cent of the growth, indicating that the study area was not attracting as many fast-growing components as slow-growing ones. The regional-share effect, however, was a positive 29 per cent. The regional-share effect indicated that 29 per cent of the total change that occurred in employment was attributed to an in creased share of total employment relative to other areas. Greatest regional-share employment gains occurred in State and local government, contract construction, and manufacturing. Of these, employment in the contract construction sector expanded at a rate almost six times the national average for construction-thus tremendously improving the competitive position of the sector nationwide. Negative effects occurred in the wholesale and retail trade, Federal government, and transportation and public utilities sectors. From an aggregate viewpoint, the four rural counties in the study area appear to have expanded both the income and employment dimensions of the economy. A net relative increase of $6.4 million in personal income occurred from 1960 to 1969. Although there was a net relative decrease of 341 jobs, total employment did increase in spite of a population decline of 1,600. Furthermore, the regional-share employment effect accounted for an increase of 1,713 jobs, thus enhancing the competitive position of the area. Such a continued regional-share growth in income and employment could provide a greatly increased level of living in the future. 28 ALABAMA AGRICULTURAL EXPERIMENT STATION 28 ALABA~A AGRICULTUL EPRMN TTO APPENDIX APPENDIX TABLE 1. URBAN AND RURAL POPULATION, SELECTED AREAS, 1960 Area Urban Rural No. 1,475, 019 65,l 422 17, 597 921 11,! 18,'740 17, 164 Total No Alabam a----------Clarke Fayette . Pct. 54.8 34.1 31.6 26.2 16.2 51.0 Pct. 45.2 65.9 68.4 73.8 83.8 49.0 No. 3,266,740 99,265 25,738 16,148 22,372 35,007 Pct. 100.0 100.0 100.0 100.0 100.0 100.0 Study area_--------Source: County----. County---_ Monroe County_--Tallapoosa County- 1,791:.,721 33, ,843 ,141 8. 4. ,227 3. ,632 17. U.S. Census of Population, 1960: General Social and Economic Char- 1,843 AND acteristics. APPENDIX TABLE 2. URBAN RURAL POPULATION, SELECTED AREAS, 1970 Area Urban Rural Total No. Pct. 58.4 No. 1,432,224 Pct. 41.6 No. 3,444,165 Pct. 100.0 Alabama -------------Study area----Clarke County Fayette County------------Monroe County------------Tallapoosa County Source: 2,011,941 ------49.1 35,889 9,726 4,707 4,846 16,610 36.7 36.4 29.0 23.2 61,810 16,998 11,545 16,037 17,230 63.3 63.6 71.0 66.8 50.9 97,699 26,724 16,252 20,883 33,840 100.0 100.0 100.0 100.0 100.0 Advance Report, U.S. Census of Population, 1970: Alabama. APPENDIX TABLE 3. PERSONAL INCOME, BY UNITED STATES, 1960-1969 MAJOR SOURCE, Item 1960 1969 Change 1960 to 1969 Mit. dot. Personal income--------- ---------Wage and salary disbursements Farms---------------------Mining-Contract construction-Finance, insurance and real Mit. dot. 744,479 504,705 3,010 Pet. 86.6 87.6 1.2 -- 399,028 269,087 2,974 3,832 15,619 87,411 5,384 30,631 157,543 40.5 96.1 80.2 Manufacturing_-----------------Wholesale and retail trade--------Transportation, communications, estate---- 49,073 12,551 82,474 24,756 68.1 97.2 and public utilities-------------Services ------------------------government --------------- 22,709 28,147 37,337 63, 018 64.4 123.9 Federal 20,962 46,219 120.5 State and local government--------Other industries-----------------Other labor income-----------------Proprietors' income ---------------- 25,162 627 10,994 - 58,939 986 27.499 66,846 50,453 134.2 57.3 150.1 44.6 46,236 Farm-- Nonfarm-Property income------------------------Transfer payments-------------Less: Personal contribution for Social 12034 9,206 16,393 36.2 47.5 34,202 52,444 29,476 106,338 65,084 25,993 102.8 120.8 182.3 Security------------------: Source: Survey of Current Business, August 1970 and August 1963. EMPLOYMENT CHANGES IN ALABAMA PERSONAL INCOME, BY MAJOR SOURCE. ALABAMA, 29 1960-1969 APPENDTX TABLE 4. Item 1960 1969 Change 1960 to 1969 Mil. dol. Personal income-------------Wage and salary disbursements 4,789 3,252 F arm s ---- ------------------ ------------ -----M ining ----------------------- --------------------- 34 Mit. dot. 9,116 40 60 Pct. 90.4 92.8 6,271 --------------- 17.6 66 344 170 Contract construction -------------------------2,028 982 M anufacturing------------------------ ------. 901 516 Wholesale and retail trade------------------240 137 Finance, insurance and real estate----Transportation, communications and 405 246 public utilities -------697 302 Services .---------------------------835 475 Federal government----------------------------708 318 State and local government-----------------13 5 O ther industries--------------------------339 130 Other labor income----------------------------------878 661 Proprietor's income-----------------------331 227 :Farm .--------------------------------------548 433 N onfarm ------------------------------------ --1,025 453 Property incom e .-------------------------------------- _ 926 415 Transfer payments Less: Personal contributions for 324 122 Social Security--------------------- 102.4 9.1 106.5 74.6 75.2 64.6 130.8 75.8 122.6 160.0 160.8 32.8 45.8 26.6 126.3 123.1 165.6 Survey of Current Business, August 1970. PERSONAL INCOME, BY MAJOR SOURCE, APPENDIX TABLE 5. CLARKE COUNTY, ALABAMA, 1960 TO 1969 Source: Personal Income Supplement to Alabama Business, February 1965 and Item 1960 1969 Change 1960 to 1969 Thou. dot. income--------------------Personal Wage and salary disbursements-------Agriculture---------------------Mining------------------------ -Contract construction-------------Manufacturing 28,022 Thou. dot. 58,538 Pct. 108.9 Transportation and utilities --------- ------------------- 16,535 364 0 572 8,090 38,369 423 683 816 18,517 132.0 16.2 00 42.7 128.9 774 2,947 1,921 4,774 148.2 62.0 Wholesale and retail trade---------- Finance, insurance, and real estate--Services---------------------- --State and local government --------- 335 673 1,114 1,797 1,027 3,846 436.4 52.6 245.2 Federal government--------------Other labor income-----------------Proprietor's income-----------------Farm -------------------------- Nonfarm .-----------------------Property income-------------------Transfer payments-----------------Less: Personal contribution for Social Security------------------ 1,665 745 5,032 1,682 3,350 2,949 3,404 644 4,565 2,169 5,465 1,386 4,079 6,886 2,337 7,991 174.2 191.1 8.6 - 17.6 21.8 133.5 134.8 262.9 Source: Personal Income Supplement to Alabama Business, May 1963 and February 1971. 30 30 ALABAMA AGRICULTURAL EXPERIMENT STATION APPENDIX TABLE 6. PERSONAL INCOME, BY MAJOR SOURCE, FAYETTE COUNTY, ALABAMA, 1960 TO 1969 Item 1960 1969 Change 1960 to 1969 Thou. dol. Personal income-- - - - - - Wage and salary disbursements Agriculture-- - - - -- - - - M in in g .-- - - - - - -- - - - -- - - - - - Contract construction Manufacturing------Transportation and Wholesale and retail trade Finance, insurance, and real estate S ervices -- - - - - - - - - - - - - - - - - - - - - State and local government------Federal government------------Other labor income---------------Proprietor's income---------------14,210 6,689 363 0 173 2,330 343 810 96 307 908 1,358 406 3,315 1,675 1,640 1,658 2,407 265 Thou. dol. 27,928 14,880 272 212 536 7,640 588 1,700 244 464 1,488 1,736 1,109 4,748 2,577 2,171 3,210 5,412 1,430 Pct. 96.5 122.5 -25.1 00 209.8 227.9 71.4 109.9 154.2 51.1 63.9 27.8 173.2 43.2 53.9 32.4 124.8 439.6 utibties Nonfarm ---------------payments----------------- Property income-----------------Transfer Less: Personal contributions for Social Security _----------- ruary 1971. Source: Personal Income Supplement to Alabama Business, May 1963 and Feb- APPENDIX TABLE 7. PERSONAL INCOME, BY MAJOR SOURCE, MONROE COUNTY, ALABAMA, 1960 TO 1969 Item 1960 1969 Change 1960 to 1969 Thou. dol. Personal income .------------------------Wage and salary Thou. dol. Put. 73.5 92.2 disbursements --------------11,426 21,959 - 22,450 38,940 380 45 2,898 8,413 2,204 Agriculture .--------------------M ining ------------------------Contract construction Manufacturing Transportation and ------------------utilities------- 505 0 345 -24.8 09 740.0 50.5 572.0 - 5,590 328 Wholesale and retail trade---------Finance, insurance, and real estate --- 116 Services.--------------------- --420 State and local government--------Federal 1,219 1,164 2,784 649 1,169 128.4 459.5 178.3 government-- - - 1,578 1,839 35.6 5.8 1,739 Other labor income.----------------. Proprietor's income.----------------Farm --------------------------Nonfarm Property income-. Transfer payment------------------. Less: Personal contributions for Social Security------------------ 639 6,126 3,450 2,676 2,166 2,544 451 1,568 7,105 3,708 3,397 4,546 5,453 1.638 145.4 16.0 7.5 26.9 109.9 114.3 274.3 Source: Personal Income Supplement to Alabama Business, May 1963 and February 1971. EMPLOYMENT CHANGES IN ALABAMA 31 EMPLOYMENT CHANGES IN ALABAMA 3 APPENDIX TABLE 8. PERSONAL INCOME, BY MAJOR SOURCE, TALLAPOOSA COUNTY, ALABAMA, 1960 TO 1969 Item 1960 1969 Change 1960 to 1969 Thou. dol. ------_------ Thou. 86,836 dol. Pct. 90.4 45,608 Personal income ----------------------- Wage and salary disbursements--------------. A griculture-------------------------------------------Mining ------------------------------------------------ Contract construction--------------------------M anufacturing ------------------------------------- 30,591 136 0 807 23,047 696 Transportation and utilities-----------------2,331 Wholesale and retail trade------------------411 Finance, insurance, and real estate-----. 1,093 Services ---------------------- -------824 State and local government 1,245 Federal government.----------------------------. 1,733 Other labor income 5,738 Proprietor's incom e---------------------------------1,614 Farm .--------------------------------------4,124 Nonfarm - -----------------------------------------3,917 Property incom e.--------------------------------------. 4,783 Transfer payments-----------------------------------Less: Personal contributions for 1.154 Social Security .--------------------------------- 58,030 1170 2,756 40,384 1,528 4,676 1,124 3,712 89.7 14.0 0 241.5 75.2 119.5 100.6 173.5 239.6 86.5 1,537 ----------------76.4 2,196 158.5 4,480 ----------------------------------- 6,820 1,699 5,121 9,575 11,069 3,139 18.9 5.3 24.2 144.4 131.4 172.0 Source: Personal Income Supplement to Alabama Business, May 1963 and February 1971. APPENDIX TABLE 9. EMPLOYMENT, BY MAJOR SECTOR, UNITED STATES, 1960-1969 Sector 1960 1969 Change 1960 to 1969 Thou. Agriculture .----------------------- Thou. 3,6061 Pet. -33.9 5,4591 Mining ---------------------------Contract construction.--------------Manufacturing---------------------Transportation and public utilities.----_ Wholesale and retail trade ----------Finance, insurance and real estate.----_ Services------------------------ --State and local government----------- 7122 2,885 16,796 4,004 11,391 2,669 7,423 6,083 619 3,437 20,169 4,431 14,645 3,557 11,211 9,446 - 13.1 19.1 20.1 10.7 28.6 33.3 51.0 55.3 and Earnings Statistics for the United States, 1909-68, August 1968. 3Source: 21.5 2,758 2,270 Federal government----------------23.8 73,879 Total-------------------------- -- 59,692 1 Source: U.S. Department of Labor, Bureau of Labor Statistics, Employment and Earnings, XVI, February 1970. 2 Source: U.S. Department of Labor, Bureau of Labor Statistics, Employmrent U.S. Department of Labor, Bureau of Labor Statistics, Employment and Earnings, XVII, December 1970. 32 ALABAMA AGRICULTURAL EXPERIMENT STATION 32 APPENDIX TABLE 10. ALBAA AGRICULTURA XEIEN TTO EMPLOYMENT, BY MAJOR SECTOR, ALABAMA, 1960 TO 1969 Sector 1960 _1960 1969- Change to 1969 No. Agriculture------M ining -------------------------------------Contract construction -----------------------------_-------Manufacturing. ----------Transportation and public utilities ---------Wholesale and retail trade----------------------Finance, insurance, and real estate _--------------------Services .----------------State and local government Federal government-----------------------------Total. --------------------------------------91,7001 13,0002 43,200 237,000 50,100 150,800 32,500 90,100 95,600 64,200 868,200 No. 62,4003 8,000-38.5 51,600 317,000 Pct. -32.0 19.4 33.8 --------41,200 127,700 146,3304 56,100 188,500 12.0 25.0 26.8 41.7 53.1 --------------------59,370 1,058,200 -7.5 21.9 1Source: Employment and Earnings Statistics for States and Areas 1939-1967, August 1968. 2 Sectors other than agriculture represent wage and salary employment only. the exception of agriculture figures, data for 1969 represent an average of the monthly employment for March, June, December. 1969 figures for State and local and Federal government employment were used in allocating total 1969 government employment of 205,700 to the two government sectors. .Basic data were from Alabama Department of Industrial Relations, Alabama Labor Market, January 1971. 'With 'December APPENDIX TABLE 11. EMPLOYMENT, CLARKE COUNTY, ALABAMA, BY MAJOR SECTOR, 1960-1969 Secto Secto Agriculture -----------------------Mining -------------------------- -Contract construction---------------Manufacturing --------------------Transportation and public utilities-----Wholesale and retail trade-----------Finance, insurance, and real estate------Services 1960 1960 1969 1969 Change 1960 to 1969 No. 980 0 100 2,400 200 900 90 280 No. 660 90 290 3,420 220 1,090 170 420 Pct. -32.7 00 190.0 42.5 10.0 21.1 88.9 50.0 --------------------------- State and local government ---------Federal govermnent----------------Total --------------------------- 335 225 5,510 795 325 7,480 137.3 44.4 35.8' Source: Research and Statistics Division, Alabama Department of Industrial Relations, Montgomery, Alabama. EMPLOYMENT CHANGES IN ALABAMA 33 APPENDIX TABLE 12. EMPLOYMENT, BY MAJOR SECTOR, FAYETTE COUNTY, ALABAMA, 1960-1969 Sector 1960 No. 1969 No. 670 0 110 1,980 140 500 80 2 00 485 195 4,360 Change 1960 to 1969 Pct. -32.3 0 175.0 90.4 40.0 13.6 100.0 2 5 .0 76.4 5.4 33.3 Agriculture Mining Contract construction Manufacturing Transportation and public utilities . Wholesale and retail trade . Finance, insurance, and real estate S ervices ..... ... ... ....... ... ... ... .... ... ... ... State and local government Federal government Total 990 0 40 1,040 100 440 40 160 275 185 3.270 Source: Research and Statistics Division, Alabama Department of Industrial Relations, Montgomery, Alabama. APPENDIX TABLE 13. EMPLOYMENT, BY MAJOR SECTOR, MONROE COUNTY, ALABAMA, 1960-1969 Sector 1960 No. 1969 No. 920 10 310 2,860 170 730 90 196Change69 Pct. - 32.4 00 195.2 41.6 36.0 36.4 100.0 Agriculture----------------------M ining ------------------------- -Contract construction Manufacturing Transportation and public utilities..... Wholesale and retail trade Finance, insurance, and real estate----- 1,360 0 105 2,020 125 535 45 Services........ . .................. State and local government Federal government Total 235 350 235 5,010 370 500 200 6,160 57.4 42.9 -14.9 23.0 Source: Research and Statistics Division, Alabama Department of Industrial Relations, Montgomery, Alabama. 34 ALABAMA AGRICULTURAL EXPERIMENT STATION 34 ALABAMA AGRICULTURLEP~MN APPENDIX TABLE 14. EMPLOYMENT, BY MAJOR SECTOR, TALLAPOOSA COUNTY, ALABAMA, 1960-1969 Sector ~~~~-Y)~YYI --- YII ~~~~--~~ 1960 1969 TTO No. Agriculture-- -- - -Mining Contract construction -- No. Change 1960 to 1969 Pct. 32.1 550 810 0 0 0 630 61.5 390 3.7 ______ 8,390 ___ 8,700 M anufacturing -33.3 120 180 Transportation and public utilities18.6 1,400 1,180 Wholesale and retail 100.0 220 110 Finance, insurance, and real estate56.1 1,030 660 Serv ices --- - - - - - - - - - - - - - - - - - - 1,140 555 105.4 State and local 460 375 22.7 Federal government------------14,250 12.6 12,650 T otalr I - - - - 11111l -- -1111~1 - - - - - - - - - - - - - -lr-lrrlr 1-71 Source: Research and Statistics Division, Alabama Department of Industrial Relations, Montgomery, Alabama. -------trade-------_ government-------. APPENDIX TABLE 15. SHIFT-SHARE ANALYSIS OF INCOME CHANGES, ALABAMA, 1960-1969 Income components National growth C omponent mix Regional share Net' relative change Mil. dol. Total personal income Fast-growing components Other labor income----------State and local government Mil. dol. 81 754 Ml. dol. 105 -117 14 -37 21 10 -212 106 -30 11 202 Mil. dol. 186 637 97 114 134 152 -51 179 -15 27 -354 195 -61 -55 4,143 113 2,078 ---_ 275 262 359 411 392 119 147 2,171 850 447 213 4 374 57 197 29 Services Federal ---- --------------- Transfer payments ---------- Property government ---------income ---- _-----___ Finance, insurance, real estate-_ Contract Slow-growing construction--_______ components ------M anufacturing-------------Wholesale and retail and public Transportation, communication trade--___ 83 151 113 142 161 73 15 16 -556 -63 -95 258 34 0 5 -90 -33 22 6 -20 Other industries._________--__ Nonfarm proprietor income--_M inin g --- - -- - - --- -- -- -- -- - - utilities -________ -55 -1 -169 -30 -114 -29 117 ~------ 4 -259 -63 -92 -23 Less: Personal contributions for 106 SocialSecurity____________ rvrrvrr~u-__------- F arms Farm proprietor -- --- - --- -- -- --- -- -- - income ------- I 97 ' Combined component-mix and regional-share effects. This convention will be used throughout the study. EMPLOYMENT E~PLOYMENT CHANGES IN ALABAMA 35 CHANGES IN ALABAMA SHIFT-SHARE ANALYSIS OF INCOME CHANGES, 3 1960-1969 Corponent mix APPENDIX TABLE 16. STUDY AREA, Income components National growth Regional shar re Net relative change Thou. dol. Personal income------Fast-growing components Other labor income State and local government Services--- - -- --- -------Transfer payments Federal government Property income---Finance, insurance, and real estate Contract construction --------Slow-growing components M anufacturing --------------Wholesale and retail trade.----Transportation and public utilities -- - - - - - - - - - - - - - - - - Nonfarm proprietor income----M in ing --- -- -- - - - -- -- - - - -- - - Farm proprietor Thou. dol. -3,136 13,619 2,237 Thou. dol. Thou. dol. 95,510 36,994 3,051 3,473 2,159 11,378 5,202 9,258 830 1,643 60,693 33,823 6,328 1,854 10,210 0 7,293 1,185 2,177 9,599 6,120 514 6,463 19,739 2,751 967 1,909 930 4,493 2,036 1,732 102 180 -14,349 -2,500 -1,352 -475 -4,610 0 -4,244 -1,168 2,406 -942 790 920 -2,907 2,534 1,925 3,286 1,720 5,413 -871 4,266 2,027 3,466 -9,374 2,070 299 2,246 -7,227 940 -6,341 -1,361 3,902 4,975 4,570 1,651 2,721 -2,617 940 -2,097 -193 1,496 Agriculture ------------- ----Less: Personal contributions for Social Security-------------APPENDIX income -------- TABLE 17. SHIFT-SHARE ANALYSIS OF INCOME CLARKE COUNTY, ALABAMA, 1960-1969 CHANGES, Income components National growth Corponent mix Regional share Net relative change Thou. dol. Personal Thou. dol. -770 3,550 473 530 251 1,164 564 Thou. dol. 7,030 4,169 305 1,237 -480 447 894 905 1,136 -305 3,381 3,940 -180 Thou. dol. 6,260 7,719 778 1,767 -229 1,641 1,458 1,383 1,172 -251 -323 3,422 -725 Fast-growing income ---------------components-------- Other labor income _--State and local government Serv ices -- - - - - - - - - - - - - - - - - - - Transfer paymentsFederal government----------. Property income---_ 24,265 9,922 645 965 583 2,948 1,442 2,5S1 478 54 Finance, insurance, and real estate ----------- ----Contract constructionSlow-growing components ------Manufacturing--Wholesale and retail trade ----Transportation and public u tilitie s -- - - - - - - - - - - - - - - ---Nonfarm proprietor income----M inin g -- - - - - - --- - - -- -- -- -- Farm proprietor income Agriculture -----------------Less: Personal contributions for Social Security-------------- 290 4 95 36 -3,704 -518 -545 -172 -1,310 0 -848 -311 616 14,901 7,006 2,552 670 2,901 0 1,457 315 558 649 -861 683 -905 55 520 477 -2,171 683 -1,753 -256 1.5136 36 ALABAMA AGRICULTURAL EXPERIMENT STATION 36 ALABAA AGRICULTURLEPIMN STIO APPENDIX TABLE 18. SHIFT-SHARE ANALYSIS OF INCOME CHANGES, FAYETTE COUNTY, ALABAMA 1960-1969 Income components National growth Coiponnte mix Regional shar re Net relative change Thou. dot. 1,416 553 352 -206 -108 919 -799 117 Thou. dol. Personal income----- - --Fast-growing components Other labor income Thou. dol. -41 2,383 258 432 115 823 460 269 10 16 -2,170 -149 -150 -76 -641 0 -844 -310 254 Thou. dol. 1,457 -1,830 94 -638 -223 96 -1,259 -152 State and local government Services-- - - - - - -- - - - - - Transfer payments Federal government Property income----Finance, insurance, and real estate ----------------Contract construction.--------Slow-growing components-------Manufacturing---------------- 12,305 6,333 352 786 266 2,084 1,176 1,436 83 150 6,201 2,018 701 297 1,420 0 1,451 314 229 55 197 3,969 3,441 339 24 -248 212 296 65 213 1,799 3,292 189 -52 -889 212 -548 Wholesale and retail trade------ Transportation and public u tilitie s -- - - - - - - - - - - - - - - - - - Nonfarm proprietor income----Minin g ------- = ------------Farm proprietor income -------- Less: Personal contributions for Agriculture ------------- ----Social Security-------------- -95 682 -405 936 APPENDIX TABLE 19. SHIFT-SHARE ANALYSIS OF INCOME CHANGES, MONROE COUNTY, ALABAMA, 1960-1969 Income components National growth ponent Thou. dol. -1,332 2,973 406 Con- Regional et relative shar Personal Fast-growing components-------Other labor income.---------State and local government Services-- - - - - - - - - Transfer paymentsFederal government ---------- income---------------. Thou. dot. 19,441 7,909 553 Thou. dol. -1,616 -314 Thou. dot. -2,948 2,659 376 Property Contract real income-- 1,008 364 2,203 1,506 1,876 100 299 11,923 4,841 1,056 284 2,317 0 2,988 437 391 554 157 870 590 351 12 33 -3,873 -358 -226 -73 -1,046 0 -1,739 -431 1432 -1,148 228 -165 -1,994 154 420 2,221 -887 -7,660 -30 -594 385 705 -1,404 505 432 2,254 -4,760 -2,018 509 1,592 -1,597 45 -2,729 -562 847 Finance, insurance, and estate-construction--------- Slow-growing components Manufacturing--------------Wholesale and retail trade----Transportation and public 735 1,665 -551 45 -990 -131 415 Nonfarm proprietor income---Mining ---------- -------- -Farm proprietor income------Agriculture .---------------Less: Personal contributions for Social utilities-- - - - - -- - - - - -- - - - -- Security -------_! J---- ---- ----- ---- --- ---- ----- - EMPLOYMENT CHANGES EPOYENT IN CHAN:GES IN ALABAMA ALABAMA 37 3 OF INCOME CHANGES, APPENDIX TABLE 20. SHIFT-SHARE ANALYSIS TALLAPOOSA COUNTi'Y, ALABAMA, 1960-1969 Regional Income component National growth ponent Thou. dol. -992 4,714 1,100 392 408 1,636 422 635 44 Coi- Net change Thou. dol. --Personal income----Fast-growing components Other labor income State and Local government Services--Transfer paymentsFederal government --Property income-Finance, insurance, and real Thou. dot. 2,719 4,092 146 -393 1,265 507 -549 1,629 314 1,173 -1,492 -1,152 758 383 -961 0 -499 -21 -119 Thou. dot. 1,727 8,806 1,246 -1 1,673 2,143 -127 2,264 358 1,250 -6,094 -2,627 327 228 -2,573 0 -1,312 -137 985 - 39,498 12,829 1,501 714 947 4,142 1,078 3,392 356 699 27, 668 19,959 2,019 603 3,571 0 1,398 118 999 Slow-growing components-------M anufacturing----__________Wholesale and retail trade-----Transportation and public u tilities-- Contract construction---------- estate------------- ----- 77 -4,602 -1,475 -431 -155 -1,612 0 -813 -116 1,104 Nonfarm Farm proprietor income-------Agriculture ------------- ----Less: Personal contributions for Social M in g in proprietor -- -- - - -- - --- -----------------income ----- -- - -- - - - - Security -------------TABLE 21. SHIFT-SHARE APPENDIX ANALYSIS OF ALABAMA, 1960-1969 EMPLOYMENT CHANGES, EIiiplyent components National gre Industrial growtmix Regional hare Net relative change No. Total No. -11,190 No. -4,955 No. 16,145 employment _-- 206,845 Fast-growing components_______________ State and local government Services -----------------real 88,035 22,965 21,445 7,735 64,955 30,115 24,510 3,090 -18,025 -2,105 -8,380 -2,110 46,930 28,010 16,130 980 Finance, insurance, and estate ----------------- Wholesale and retail trade Slow-growing Federal government----------- components------- 35,890 118,810 15,280 7,240 -76,145 -1,475 -5,430 13,070 -18,620 1,810 -63,075 -20,095 Manufacturing_______________ Contract construction Transportation and public Mining_________ Agriculture 56,405 10,280 11,925 -8,770 -2,030 -6,565 32,470 130 650 23,700 -1,900 -5,915 utilities -------------------- 3,095 21,825 -4,800 -52,505 -3,300 1,740 -8,100 -50,765 38 38 ALABAMA AGRICULTURAL EXPERIMENT STATION APPENDIX TABLE 22. SHIFT-SHARE ANALYSIS OF EMPLOYMENT STUDY AREA, 1960-1969 CHANGES, Component National nNe growth Industrial mix Regional share et chlangve No. Total employment _____ Fast-growing components State and local government Services-- --- ----- ---- - --Finance, insurance, and real estate ------------ ----Wholesale and retail trade-----Slow-growing -------Federal government------------ No. -2,054 979 442 363 27 147 -3,033 -23 -512 -30 -79 0 -2,389 No. 1,713 714 738 4 180 -208 999 -59 332 584 -20 100 62 No. -341 1,693 1,180 367 207 -61 -2,034 -82 -180 554 -99 100 -2,327 6,266 1,447 334 318 68 727 4,819 243 3,296 151 144 0 985 components M anufacturing.--------------. Contract construction---------Transportation and public u tilitie s -- - - - --- - - - - - - - - - - -M inin g -- -- -- - - - - -- - - - - -- -- A griculture ------------- ----APPENDIX TABLE 23. SHIFT-SHARE ANALYSIS OF EMPLOYMENT CLARKE COUNTY, ALABAMA, 1960-1969 CHANGES, Component National growth Industrial mix Regional share ret chlangve No. Total employment Fast-growing components No. -456 234 106 76 9 43 -690 -5 -89 -5 -26 0 -565 No. 1,116 254 275 -3 50 -68 862 52 538 171 -1 90 12 No. 660 448 381 73 59 -25 172 47 449 166 -27 90 -553 -----State and local government Services - - - - - - Finance, insurance, and - real _______________ Wholesale and retail trade---- 1,312 382 80 67 21 214 930 54 571 24 48 0 233 estate Slow-growing components-----Federal government--------_ Manufacturing______ Contract construction._______ Transportation and public M ining ------------------Agriculture-- - -- u tilities -- - - -- - -- - - - - -- -- EMPLOYMENT CHANGES IN ALABAMA 39 CHANGES, APPENDIX TABLE 24. SHIFT-SHARE ANALYSIS OF EMPLOYMENT FAYETTE COUNTY, ALABAMA, 1960-1969 Component National growth No. 780 218 65 38 10 105 562 44 248 10 24 0 236 Industrial mix No. -471 156 87 44 4 21 -627 -3 -38 -2 -13 0 -571 Regional share No. 785 -23 58 -42 27 -66 808 -80 731 62 29 0 16 relative change No. 314 133 145 2 31 -45 181 -33 693 60 16 0 -555 Total employment Fast-growing components .State and local government Services . Finance, insurance, real estateWholesale and retail trade --Slow-growing components ----Federal governmentM anufacturing ............ Contract construction Transportation and utilities ... Mining ................. ... A griculture ------------ ---- - APPENDIX TABLE 25. SHIFT-SHARE ANALYSIS OF EMPLOYMENT MONROE COUNTY, ALABAMA, 1960-1969 CHANGES, National Component Componentgrowth Total employment. Fast-growing components _. State and local government_-------------------------. Services Finance, insurance, real estate-Wholesale and retail trade----Slow-growing components........ Federal government Manufacturing ................ Contract construction Transportation and utilities -------------------------Mining . Agriculture Industrial mix Regional share No. 639 44 -43 15 30 42 595 -86 434 185 32 10 20 relative change No. -43 248 67 79 34 68 -291 -91 359 180 16 10 -765 No. No. -682 1,193 204 277 110 83 64 56 4 11 26 127 -886 916 -5 56 -75 481 -5 25 -16 30 0 0 -785 3----------24 APPENDIX TABLE 26. SHIFT-SHARE ANALYSIS OF EMPLOYMENT TALLAPOOSA COUNTY, ALABAMA, 1960-1969 CHANGES, Component National growth No. Industrial mix No. Regional share No. Net change No. Total employment Fast-growing components ...... State and local government -Services _-----Finance, insurance, real estateWholesale and retail trade Slow-growing components .... Federal government_ Manufacturing ... Contract construction Transportation and utilities M ining ................ .. Agriculture 3,011 596 132 157 26 281 2,415 89 1,997 93 43 0 193 -40'6 422 175 180 10 57 -828 -9 -310 -18 -24 0 -467 -1,003 267 278 34 73 -118 -1,270 5 -1,376 165 -79 0 15 -1,409 689 453 214 83 -61 -2,098 -4 -1,686 147 -103 0 -452 AGRICULTURAL EXPERIMENT STATION SYSTEM OF ALABAMA'S LAND-GRANT UNIVERSITY With an agricultural research unit in every major soil area, Auburn University serves the needs of field crop, livestock, forestry, and horticultural producers in each region in Alabama. Every citizen of the State has a stake in this research program, since any advantage from new and more economical ways of producing and handling farm products directly benefits the consuming public. 4 F Research Unit Identification 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. Tennessee Valley Substation, Belle Mina. Sand Mountain Substation, Crossville. North Alabama Horticulture Substation, Cullman Upper Coastal Plain Substation, Winfield. Forestry Unit, Fayette County. Thorsby Foundation Seed Stocks Farm, Thorsby. Chilton Area Horticulture Substation, Clanton. Forestry Unit, Coosa County. Piedmont Substation, Camp Hill. Plant Breeding Unit, Tallassee. Forestry Unit, Autauga County. Prattville Experiment Field, Prattville. Bluck Belt Substation, Marion Junction. Tuskegee Experiment Field, Tuskegee. Lower Coastal Plain Substation, Camden. Forestry Unit, Barbour County. Monroeville Experiment Field, Monroeville. Wiregrass Substation, Headland. Brewton Experiment Field, Brewton. Ornamental Horticulture Field Station, Spring Hill. Gulf Coast Substation, Fairhope.