HIGHLIGHTS OF THE ECONOMY OF THE NORTHEAST GEORGIA AREA. by Lamar White and Mary Riddle

Transcription

1 Project E HIGHLIGHTS OF THE ECONOMY OF THE NORTHEAST GEORGIA AREA by Lamar White and Mary Riddle Industrial Development Division Engineering Experiment Station GEORGIA INSTITUTE OF TECHNOLOGY September 1963

2 Table of Contents Foreword INTRODUCTION POPULATION AND EMPLOYMENT IN THE NORTHEAST GEORGIA AREA DISTRIBUTION OF EMPLOYMENT IN THE NORTHEAST GEORGIA AREA DISTRIBUTION OF EMPLOYMENT IN CLARKE COUNTY COMPARATIVE DISTRIBUTION OF EMPLOYMENT IN THE NORTHEAST GEORGIA AREA, CLARKE COUNTY, GEORGIA, AND THE U. S. AGRICULTURAL AND MANUFACTURING EMPLOYMENT IN GEORGIA AND THE NORTHEAST GEORGIA AREA DISTRIBUTION OF MANUFACTURING EMPLOYMENT BY INDUSTRY EMPLOYMENT TRENDS A PRELIMINARY EVALUATION OF THE NORTHEAST GEORGIA AREA ECONOMY i * Charts Table 1. Population and Employment in the Nine Counties Forming the Northeast Georgia Planning and Development Commission, Predominance of Manufacturing or Agricultural Employees, Distribution of Employment in the Northeast Georgia Area, Distribution of Employment in Clarke County, Distribution of Employment in Northeast Georgia Area, Clarke County, Georgia, and the United States, Employment Trends in the Northeast Georgia Area, Distribution of Manufacturing Employment by Industry in Northeast Georgia Area, Clarke County, Georgia, and the U. SQ,

3 Foreword The fourth in the series of reports being prepared on the economies of various sections of the State, this report is designed to give local and area development groups basic information they need as background for their efforts to develop new payrolls in their particular section of the State. Like the others in the series, beginning with the Coosa Valley Area where the Industrial Development Division has operated a pioneering branch industrial development office since the spring of 1961, this report is designed to put the economy of the area in perspective. It represents, of course, only the first of many steps required to determine the area's strengths and weakness, its problems and potentials. Questions or comments regarding the report will be welcomed. Kenneth C. Wagner, Chief Industrial Development Division GEORGIA INSTITUTE OF TECHNOLOGY - i-

4 INTRODUCTION Athens and Clarke County form the core of the nine-county Northeast Georgia Area. As in other sections of the State, manufacturing is the primary source of employment, providing nearly one-third of the area's jobs. Agriculture accounts for a larger proportion of the jobs in the area % -- than it does in the State as a whole. Although it is beyond the scope of this brief report to evaluate the impact on the area's economy of the University of Georgia in Clarke County, its importance is apparent. The fact that education accounted for 14.6% of all jobs in Clarke County in 1960 signifies the importance of the University not only to Clarke County but to the area and the State. It is the purpose of this report to provide perspective on the economy of the area which will be useful in the research and development activities which may be carried out to help develop the area's specific economic potentials and opportunities. -1-

5 MAP 1 OPULATION AND EMPLOYMENT IN THE NINE COUNTIES FORMING THE NORTHEAST GEORGIA PLANNING AND DEVELOPMENT COMMISSION, 1960 P = POPULATION E =TOTAL EMPLOYED (by place of residence) GEORGIA -3-

6 DISTRIBUTION OF EMPLOYMENT IN THE NORTHEAST GEORGIA AREA Chart 1 shows the percentage distribution by industry of all resident employment in the nine-county area. The leading category in 1960 was manufacturing, which employed 17,737 people, as compared with 6,964 in retail trade, 6,585 in personal and recreational services,ll and 6,148 in agriculture. These four categories combined accounted for about 70% of the total. Sectors of intermediate importance include educational services (3,840) and construction (3,248). The sum of the six preceding categories represented about 83% of the area's total employment in ll "Personal and recreational services" comprise repair services; employment in private households, hotels, and motels; laundry and dry cleaning services; and entertainment and recreational services. "Business and professional services" include advertising, accounting, auditing, and bookkeeping services; welfare, religious, and nonprofit membership organizations; hospitals; and other professional and related services (except educational). -4-

7 CHART I DISTRIBUTION OF EMPLOYMENT IN THE NORTHEAST GEORGIA AREA, 1960 MANUFACTURING 33.0% INDUSTRY NOT REPORTED - 1.8% --- -FORESTRY, FISHERIES, MINING - 0.5% FINANCE, INSURANCE, REAL ESTATE - 2.1% WHOLESALE TRADE - 2.4% PUBLIC ADMINISTRATION - 2.9% BUSINESS AND PROFESSIONAL SERVICES - 3.7% TRANSPORTATION, COMMUNICATIONS, UTILITIES - 3.7% EDUCATIONAL SERVICES - 7.2% SOURCE: U.S. Census of Population -5-

8 DISTRIBUTION OF EMPLOYMENT IN CLARKE COUNTY Distribution of total employment by industry for Clarke County is shown in Chart 2. The four outstanding categories were manufacturing, employing 3,674; retail trade, 2,605; personal and recreational services, 2,534; and educational services, 2,418. Less than 3% of the workers in Clarke County were employed in agriculture, forestry, fisheries, and mining. -6-

9 CHART 2 DISTRIBUTION OF EMPLOYMENT IN CLARKE COUNTY, 1960 RETAIL TRADE 15.8% PERSONAL AND RECREATIONAL SERVICES 15.3% MANUFACTURING 22.2% INDUSTRY NOT REPORTED - 2.3% FORESTRY, FISHERIES, MINING - 0.2% AGRICULTURE - 2.5% EDUCATIONAL SERVICES 14.6% - 3.1% FINANCE, INSURANCE, REAL ESTATE - 3.4% PUBLIC ADMINISTRATION - 4.0% COMMUNICATIONS, UTILITIES - 4.5% BUSINESS AND PROFESSIONAL SERVICES - 6.6% CONSTRUCTION - 5.5% SOURCE: U.S. Census of Population -7-

10 COMPARATIVE DISTRIBUTION OF EMPLOYMENT IN THE NORTHEAST GEORGIA AREA, CLARKE COUNTY, GEOR<;IA, AND THE U. So Chart 3 provides a comparison of the employment mix in the Northeast Georgia Area, Clarke County, Georgia, and the United States as a whole. The nine-county area has comparatively large proportions of its work force employed in manufacturing, agriculture, and educational services. Its percentage in personal and recreational services is slightly higher than Georgia's and much higher than the nation's. It has comparatively small shares of its total employed in all other categories except construction, where its percentage is about the same as the all-georgia and the national ratios. Clarke County has relatively large percentages of its total employed in personal and recreational services and educational services, its third and fourth sectors when ranked according to absolute numbers. Clarke's percentage in retail trade, its second largest category, is also somewhat higher than the Georgia and national ratios. Its percentage in business and professional services is higher than the State's but lower than the nation's. In manufacturing employment, Clarke has a relatively low percentage even though this is its number one category in absolute terms. Clarke's ratios are also relatively low in agriculture and seven other sectors construction, transportation, public administration, wholesale trade, finance, forestry, and miscellaneous. -8-

11 CHART 3 DISTRIBUTION OF EMPLOYMENT IN NORTHEAST GEORGIA AREA, CLARKE COUNTY, GEORGIA, AND THE UNITED STATES, 1960 % OF TOTAL EMPLOYME.NT m~~~~~~~f~~~ NORTHEAST GEORGIA AREA ~ CLARKE COUNTY ~GEORGIA.u.s I \.0 I ~ ~~ ~..::s ~'-' ~ # ~

12 AGRICULTURAL AND MANUFACTURING EMPLOYMENT IN GEORGIA AND THE NORTHEAST GEORGIA AREA Map 2 compares agricultural and manufacturing employment by county in Georgia, by place of residence. Manufacturing leads agriculture in 104 of the State's 159 counties. Within the area examined in the present study, manufacturing employment is greater in eight of the nine counties; it trails by a small margin in the ninth (Morgan). -10-

13 MAP 2 PREDOMINANCE OF OR AGRICULTURAL (by place of residence) MANUFACTURING EMPLOYEES, 1960 AGRICULTURE MANUFACTURING It / 1 l~:~:~:}~:f~:~j D - GREATER BY 1-1,500 1,500-5,000 5,000-10,000 10,000-25,000 OVER 25,

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15 DISTRIBUTION OF MANUFACTURING EMPLOYMENT BY INDUSTRY Table 1 (on page 15) compares the distribution of manufacturing employment in Clarke County and the entire nine-county area with the distribution in Georgia and the nation. Of the 17,737 residents of the Northeast Georgia Area employed in manufacturing as of 1960, more than three-fourths were in nondurable goods manufacture. This is well above the all-georgia percentage (66.4), and it far exceeds the national average (43.9%). Leading industry groups in the nine-county area include apparel (30.6% of total manufacturing employment), textiles (26.3%), food and kindred products (14.2%), and wood products and furniture (9.7%). Each of these is more prominent in the study area's pattern than in the national pattern. All except wood products and furniture are also of greater relative importance in the local area than in Georgia as a whole. The concentration of apparel manufacture is especially noteworthy; employment in the nine-county area represents 11.6% of Georgia's total. Electrical machinery manufacture is more prominent in Clarke County than in Georgia and the nation, and is of greater relative importance in the nine-county area than in the State as a whole. The Northeast Georgia Area contains four of the State's 40 leading manufacturing employment counties, tabulated according to place of residence. These are Barrow, Clarke, Jackson, and Walton. The nine-county area has over 50 factories employing 100 or more persons. This count is based on a statewide inventory compiled in 1961 and 1962.l/ Several additional large new plants and expansions were then in various stages of completion within the nine-county area. Major products or product classifications of the area's outstanding manufacturing employers are listed on the next page. This list is illustrative rather than exhaustive. lf Thera H. Richter, Georgia Manufacturing Atlas, Industrial Development Division, Engineering Experiment Station, Georgia Institute of Technology, Atlanta, Georgia, June

16 Industry Group Food Products Textile Mill Products Apparel Wood Products Furniture Paper and Allied Products Rubber Products Primary Metals Fabricated Metals Machinery Transportation Equipment Instruments Product(s) or Product Classification Poultry products and processing; dairy products; bakery products Cotton cloth, gauze, and sheeting; ropes and cords; corduroy and twill fabrics; cotton grey goods; yarn; woolen blankets Men's suits, sportswear, slacks, trousers, work clothing; boys' clothing; ladies' sportswear; infants' diapers and garments; raincoats Dressed lumber Upholstered living room furniture, boat seats Milk cartons, foodboard Tread rubber, tire repair material Nonferrous electric wire and cable Aluminum awnings, stainless steel food serving equipment, insecticide sprayers and dusters, small tractor implements, snowplow blades Rotary pumps, power transformers Nacelles (for aircraft) Clocks and radio timers -14-

17 Table 1 DISTRIBUTION OF MANUFACTURING EMPLOYMENT BY INDUSTRY IN NORTHEAST GEORGIA AREA, CLARKE COUNTY, GEORGIA, AND THE U. S., 1960 Manufacturing Category Manufacturing, total Durable goods: Furniture, lumber, wood products Primary metals Fabricated metals Machinery, nonelectrical Electrical machinery Motor vehicles and equipment Transportation equipment, except motor vehicles Other durables Nondurable goods: Food and kindred products Textiles Apparel Printing, publishing Chemicals and allied products Other nondurables Durables, total Furniture, lumber, wood products Primary metals Fabricated metals Machinery, nonelectrical Electrical machinery Motor vehicles and equipment Transportation equipment, except motor vehicles Other durables Nondurables, total Food and kindred products Textiles Apparel Printing and publishing Chemicals and allied products Other nondurables (By place of residence) Northeast Number employed: 17,737 4,228 1, ,509 2,512 4,669 5, Per cent of total employment: Clarke County 3, , State of Ga. 364, ,565 45,565 5,278 9,451 10,236 7,300 11,781 15,640 17, ,056 44,650 94,614 46,902 14,159 13,966 27, u. s. (000) 17,513 9,829 1,067 1,225 1,292 1,568 1, ,371 7,684 1, ,159 1, , Note: In the nine-county area, "other durables" consist mainly of instru ~s and stone, clay, and glass. "Other nondurables" consist mainly of paper and allied products. Source: U. Sg Census of Population -15-

18 EMPLOYMENT TRENDS Total net change Manufacturing Retail trade Construction Educational services Business and professional services Personal and recreational services Finance, insurance, and real estate Public administration Transportation, communications, utilities Wholesale trade Forestry, fisheries, mining Miscellaneous (industry not reported) Agriculture 1,653 5,054 1,375 1,075 1, ,918 Chart 4 shows employment by industry in the nine-county area for 1950 and Each category except agriculture has become more important since 1950, both relatively and in absolute terms. Agriculture now accounts for only 11.4% of the area's total employment, as compared with 30.9% in The Northeast Georgia Area had a modest net gain in total employment from 1950 to This increase of 1,653 jobs represented a percentage gain of 3.2%, as compared with 10.4% for all of Georgia and 14.5% for the country as a whole. The chief explanation for this contrast lies in the sharper rate of decline in the nine-county area's agricultural employment. About 62% of its 1950 farm jobs disappeared by 1960, as compared with Georgia's loss of about 55%, and the nationwide loss of about 38%. All categories but agriculture showed a gain in employment between 1950 and 1960, and the area's growth rates were far superior to both national and all-georgia rates in manufacturing, construction, and business and professional services. The rate of gain in educational employment was less than that of the State, but educational services represented only 4.7% of all employment in Georgia in 1960, while in the study area this category's proportion was 7.1%. The area's absolute job gains from 1950 to 1960 were greatest in manufacturing. Other categories contributing substantial increases include retail trade, construction, and two service categories. However, the combined gains in these five sectors offset the loss of over 9,900 farm jobs by only a small margin. Absolute changes by industry from 1950 to 1960 are shown below. -16-

19 CHART 4 EMPLOYMENT TRENDS IN THE NORTHEAST GEORGIA AREA, EMPLOYMENT (in thousands) ~

20 Within the nine-county area, Clarke County's 1950 employment structure reflected a comparatively mature economy, except for its small proportion of manufacturing employment. About 82% of its employment was in services, trade, manufacturing, and finance -- as compared with about 70% for the nation and 64% for Georgia. Consequently, its employment trends from 1950 to 1960 differ significantly from those of the larger area. More than 94% of Clarke's jobs in 1950 were nonagricultural. Therefore, its absolute job losses in this nationally declining sector were quite limited -- only 346. Its absolute gain in each of three sectors -- manufacturing, educational services, and business and professional services -- was more than enough to cover the loss of farm jobs. Without Clarke's net gain of 3,271 in total employment over the 10-year period, the remaining eight counties of the area show a net loss of 1,618 jobs. Clarke County's percentage increase in total employment from 1950 to 1960 was superior to the State's and the nation's. This favorable showing is mainly attributable to its strong gains in manufacturing and business and professional services and to its comparatively light losses in agriculture. Clarke's increase in educational services also was substantial. Although lower percentagewise than the Georgia and national gains, its 48% rate of gain came upon a relatively large base due to the presence of the University of Georgia. In 1960 education accounted for 14.6% of all jobs in Clarke County (up from 12.3% in 1950), as compared with all-georgia proportions of 3.3% in 1950 and 4.7% in The county's smaller absolute gains in public administration, finance, and construction reflected percentage increases far above the national rates, but below the Georgia rates -- except in the case of construction. Clarke's relative showing in the other employment sectors was not particularly favorable. The county's worst showing was in wholesale trade and personal and recreational services, where actual losses were incurred. -18-

21 A PRELIMINARY EVALUATION OF THE NORTHEAST GEORGIA AREA ECONOMY Viewed as a whole, the nine-county area is a comparatively low-income section of Georgia. It is thinly populated and has not been maintaining its prewar shares of Georgia's people and jobs. According to data from the 1960 Census of Population and other recent censuses, the area's shares of Georgia's total land area, land in farms, and mining establishments are greater than its shares of the State's population, housing units, factories, and other types of business and industrial establishments. Moreover, its share of Georgia's residents exceeds its shares of high school enrollment, personal income, bank deposits, and retail sales. Although its shares of the State's civilian labor force, total jobs, and manufacturing jobs are higher than its share of population, the area has disproportionately low numbers of sound housing units and high-income families and a relatively large share of families in the lowest income bracket. The Northeast Georgia Area is still more strongly oriented to agriculture than is the State as a whole. Also, the fact that its shares of Georgia's farm products sales receipts is greater than its share of land in farms is one indication that its agriculture is relatively prosperous. The economy of the Northeast Georgia Area has undergone profound changes in recent decades. In five of the nine counties, there were more farm jobs lost between 1950 and 1960 than total new jobs brought in by net additional manufacturing and other nonfarm activities. However, the present employment structure in the area as a whole is an improved one. Manufacturing, services, and other industries generally associated with economic betterment now account for over 88% of total employment in the nine-county area, as compared with less than 69% in The area's 88% still lags behind the corresponding national and all-georgia ratios, but the gaps have narrowed substantially. In 1960, manufacturing employees outnumbered agricultural employees in the Northeast Georgia Area as a whole and in eight of its nine individual counties. Manufacturing employment in the area is concentrated largely in nondurable goods industries, which as a group have tended to be less vulnerable to recessions than durable goods industries. However, this area's industry mix is heavily weighted with food products and apparel, which have been somewhat more vulnerable to recessions than has manufacturing employment generally. -19-

22 Too, the area's leading industry groups are among those with the lowest average wages in manufacturing. They are also prone to slow growth, according to unpublished national forecasts of employment by industry group to the mid- 1970's. In the case of textiles, which account for over 26% of the area's manufacturing jobs, industry-wide employment is expected to decrease slightly in the next decade or so. The biggest single employer in the area, however, is the University of Georgia in Athens, and its influence on the economy of the area goes far beyond the direct employment of faculty and staff. The thousands of students brought into the area (plus visiting relatives and friends) form a major market for retail goods and services -- a market that is continually being renewed. Among the various broad categories of employment, four are expected to show superior rates of growth nationally between now and 1975, according to the aforementioned forecasts. These include trade, services, finance, and construction. Combined employment in these industries represented only 39.3% of the nine-county total in 1950, but rose to 49.6% in The gaps between the nine-county area's pe~centage and the corresponding percentages for Georgia, the United States, and Clarke County (ranked in ascending order) narrowed considerably from 1950 to Conversely, Clarke County's impressive lead over each of the other areas diminished by A comparison of each area's combined employment in trade, services, finance, and construction as a percentage of its total employment is shown below for the two census years Clarke County u. s. average Georgia average Northeast Georgia Area These comparisons indicate that the nine-county area's employment structure still is relatively unfavorable but has improved at a comparatively rapid rate. This improvement, it must be emphasized, is from the standpoint of~position. The growth of jobs in the absolute sense, as discussed in "Employment Trends," has been at a distinctly unfavorable rate in the nine-county area. -20-

23 Occupational migration from farm to nonfarm jobs appears certain to continue in the years ahead. The real question is what the geographic pattern of these migrations will be. The locations of the job openings and the technical training facilities clearly are the principal magnets, both for job migrants and for persons newly entering the labor force. An audit of the area's economic development resources and advantages is well beyond the scope of the present study. However, a few points of this nature call for brief comment. The Northeast Georgia Area's "pulling power" will depend in part on how effectively the State's new vocational-technical schools planned for Athens meet today's needs in the area for training technicians and skilled workers. These schools should provide valuable supplements to existing university facilities in the Athens-Atlanta area for developing scientists and engineers, and for encouraging complementary industrial research. The closely related need in Georgia to improve general educational levels is especially urgent in eight of the area's nine counties. Except for Clarke County, each county of the area falls below the State as a whole in the average educational level of residents 25 years old and over. The percentage with a high school education or more also is uniformly lower in each of the eight counties than in the State. The statewide percentage of those completing less than five school years is lower than the corresponding percentage in seven of the eight counties; Barrow is the lone exception. All counties of the area made gains from 1950 to 1960 in median school years completed. Only in Clarke and Morgan, however, were these gains favorable in comparison with all-georgia and national averages. Georgia's median rose from 7.8 to 9.0 school years completed, and the Uo s. average rose from 9.3 to Morgan County's median increased from 6.5 to 7.8, and Clarke's from 8.9 to All others fell farther behind the Georgia and national norms. -21-