West Virginia’s Economic Highs and Lows

The WVU Bureau of Business and Economic Research has released its economic outlook for the state. As is often the case, there is good, bad and ugly.

The good news is that West Virginia’s economy has regained all the ground lost during the worst of Covid. “We suffered through the fastest economic collapse in modern history, but we are almost fully recovered,” according to the report.

Employment in construction, professional services, transportation and utilities, mining and natural resources, and financial activities  are at or slightly above January 2020 levels. Manufacturing, retail and wholesale trade are just a point or two behind pre-pandemic levels.

West Virginia has recorded economic wins in 2022. Nucor Steel in Mason County, GreenPower Motor Company in Kanawha County, OBT Bluefield sustainable housing company in Mercer County and the health care logistics company Owens & Minor in Monongalia County collectively are adding 1,500 jobs.

The state’s unemployment rate spiked during the pandemic to over fifteen percent, but it has dropped down to just under four percent.

But not all the news is good.

The report shows that the economic growth is concentrated in a few areas. Growth counties added nearly 16,000 jobs between 2012 and 2019.  However, the “balance of the state lost 44,000 jobs” during that period and 13 of the state’s counties, including six in the southern half of the state, are projected to have more job loss over the next five years.

West Virginia continues to have a shortage of available workers. The state’s labor participation rate is just 55 percent, the lowest in the nation and well under the national average of 62 percent. The labor participation rate among West Virginians in their prime working years (ages 25-54) is 74 percent, again the lowest in the nation.

The state is also behind the rest of the country in education attainment. Just 24 percent of West Virginians ages 25 and older has a bachelor’s degree or higher. That is the lowest in the country and 11 percentage points below the national average.

And now for the ugly, or perhaps we should call this the tragic.

The drug overdose rate in 2020 was 81 deaths per 100,000 population. That was nearly twice the rate of the next highest state of Kentucky, and three times the national average. This is one of West Virginia’s great societal problems that is not easily solved, although more recent numbers suggest the state is beginning to make some headway.

You have heard this story before; our economic picture is a mix of encouraging and discouraging data. Our challenge remains building on what works, while trying to fix what is broken.

 

 

 





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