Trend Analysis Of Rural Underemployment: An Example From North Dakota

The unemployment rate continues to be the major criterion used in selecting counties for special economic assistance. But the official unemployment rate is not a valid measure of either the quality or quantity of the rural labor force. The continued use of the official unemployment measure leaves rural areas at a disadvantage compared to urban areas in the distribution of economic development assistance. Home, et al. (1974) found that selecting counties on the basis of unemployment omitted many countieswith both the greatest labor potential and economic need for expanded industrialization. They found that under-employment was a much better indicator of both underutilized labor and economic need. They believed that the use of underemployment as a criterion should be used.to guide programs directed toward job creation in nonmetro areas. Briggs (1981) said that the unemployment rate had little relevance to the nonmetro economy. If underemployment measures were included in formulas that allocate funds for federal programs, he thought there would be a considerable increase in assistance provided under most programs to rural areas. Our purpose in this paper will be to track three measures of rural underemployment using three years of survey data from the ND Rural Life Poll. We will compare the official unemployment rate with the rate calculated from the survey data. We will also add two new measures to the composite measure of underemployment