Education and the Workforce: Delmarva in the Rural-Urban Context Robert M. Gibbs Economic Research Service - USDA The views and opinions expressed in this presentation do not necessarily reflect the views of the Economic Research Service or the U.S. Department of Agriculture.

Overview The seven counties that make up the Lower Delmarva region are experiencing significant transition, from an economy based on agriculture and manufacturing to one based on services. Educational attainment levels in most of the region, however, are lower than its changing industry mix would imply. The outmigration of young adults due to the close proximity of urban areas with higher-wage jobs, and a sizable minority population with relatively low human capital levels are serious challenges to economic development. Yet these same attributes of access and diversity could be turned to the region’s advantage if complemented by a development strategy that includes a strong human capital investment component.

Distribution of Employment by Selected Industries, 2000 The Delmarva economy has an industrial structure that is distinct from either the typical urban or rural structure. The region has a more “urban” profile in terms of manufacturing’s share of employment, and a more “rural” profile in terms of professional services. In agriculture, Delmarva falls between the two profiles. Percent Note: “Rural” and “urban” in this presentation refer to “nonmetropolitan” and “metropolitan” counties, according to the 1993 metro definitions authorized by the Office of Management and Budget. Source: Calculated by ERS using data from the US Census Bureau

Adult Educational Attainment in Delmarva, 2000 Delmarva’s education profile is much closer to that of a typical rural county. Less than one in five adults ages 25 and over has a 4-year college degree; nearly one in four lacks a high school diploma. Source: Calculated by ERS using data from the US Census Bureau

Educational Attainment in Delmarva Counties, 2000 Substantial variation exists within the Delmarva region, reflecting in part the differing industrial histories and current economic mix of the seven counties. Source: Calculated by ERS using data from the US Census Bureau

Delmarva Counties and Their Twins Each county in the region was matched with another U.S. county sharing a similar industrial structure AccomackGrady, GA DorchesterCanyon, ID SomersetPittsburg, OK SussexBenzie, MI WicomicoCape Girardeau, MO WorcesterHarrison, MS

Share of Adults With No High School Diploma in Delmarva and Twin Counties, 2000 In most cases, the twin county has a lower share of adults who did not complete high school than the Delmarva county. Percent Source: Calculated by ERS using data from the US Census Bureau

Share of Adults With Four-Year College Degree in Delmarva and Twin Counties, 2000 College completion rates are higher in most of the twin counties. This slide, and the previous one, suggest that Delmarva has a lower human capital base than would be expected given its industry mix. Percent Source: Calculated by ERS using data from the US Census Bureau

Issues: Metropolitan Proximity Four metropolitan statistical areas with at least one million people lie within a 3-hour drive. Economic differences between Delmarva and nearby cities are especially large, given the great number of managers and professionals in these cities, and the quasi-rural character of Delmarva’s industry and education profiles. Delmarva youth have a large number of lucrative alternatives – human capital “leakage” likely to remain significant But Delmarva’s proximity to urban areas, combined with its natural amenities, also make it appealing to managers and professionals – the region could build on these strengths. Investment in high-quality schools could play an important role here.

Earnings Per Job in Manufacturing and Retail Industries, 2000 Earnings in Delmarva are much lower than in nearby metropolitan areas. This especially encourages outmigration among the younger and the better-educated. Dollars Source: Calculated by ERS using data from the Bureau of Economic Analysis, Dept. of Commerce

Issues: Racial and Ethnic Inequality Delmarva counties have a larger-than-average share of African- Americans. Hispanics are a small but rapidly growing share of the Delmarva population. African-Americans and Hispanics in the region have far lower educational attainment on average than whites who are not Hispanic Parents’ education and income are critical predictors of student’s future attainment. Thus, racial and ethnic inequality are likely to persist without intervention. The challenge of including African-Americans and Hispanics in community and regional decision-making will become more pressing in the near future.

Hispanic and African-American Population Shares in Delmarva Counties, 2000 Percent Source: Calculated by ERS using data from the US Census Bureau

Educational Attainment by Race/Ethnicity in Delmarva Counties, 2000 Percent Source: Calculated by ERS using data from the US Census Bureau

Issues: Role of Manufacturing Manufacturing is often an “anchor” sector Manufacturing job growth in the1990s was greater in places with higher educational attainment rates. In contrast, employers in the 1980s often sought low-wage (and low education) locations. New strategies for retaining and expanding manufacturing rely on partnerships among high schools, high-skill employers, and public and private “mediators.”

Percent Change in Rural Manufacturing Jobs by High School Completion Rates In the 1980s, manufacturing grew faster in rural counties with lower completion rates. But in the 1990s, low-education counties lost manufacturing jobs. County rank in high school completion rate Young adults ages Produced by David McGranahan, ERS, with data from the 1990 Census of Population.

Conclusions Delmarva’s economy exhibits similarities to both the urban and rural models. Educational attainment is slightly below expectations, given its industrial structure. Low educational attainment may constrain Delmarva’s transition to a higher wage, higher skill economic track. Metropolitan proximity has probably contributed to “brain drain.” But this could be mitigated -- access to markets, cultural amenities, potential migrants. Schools are a key factor. Racial inequality is a challenge to all components of the workforce development system. Economic transition to services inevitable, but preserving traditional sectors can pay off. School-work partnerships can make a difference.