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Report Shows Bump in Appalachian Economies, But Drugs, Coal Still a Factor in Future Growth

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A  report from the Appalachian Regional Commission shows that across the region, Appalachian communities are starting to rebound. In the past year, there has been a drop in the number of counties that are considered economically distressed by the ARC, leading to the best economic report of its kind for the region in more than a decade, but the gains are incremental.

The ARC’s annual ranking of counties is based on three economic indicators– the three-year average unemployment rate, the per capita market income and the poverty rate of each county. The number of counties deemed economically distressed decreased in total by three this year to 81 of the 420 counties included in the region.

The ARC report also found that poverty rates in both Appalachia and the nation dropped in the last year, but Appalachia’s poverty rate continues to be higher than the rest of the country.

In all, 21 counties in Alabama, Georgia, Mississippi, North Carolina, Ohio, Pennsylvania and Tennessee experienced a positive shift in their economic status. Eighteen others in Alabama, Georgia, Kentucky, Mississippi, Ohio, Virginia and West Virginia have fallen, many of which are in the region’s prime coal-producing areas.

West Virginia, the only state to sit wholly within Appalachia, did not follow the region’s overall economic growth trend, but instead saw three counties drop into the ARC’s economically distressed category. Fifteen of the state’s 55 counties now fit the definition of distressed.

Some residents in West Virginia and other coal-producing states in Appalachia, however, may feel a renewed sense of hope for continued economic improvement following the announcement of Pres. Donald Trump’s Affordable Clean Energy Rule last month at a rally in Charleston, West Virginia. Trump touted the rule as a way to bring back jobs, with promises to roll back Obama-era emissions standards for coal-powered plants.

Trump’s plan would rescind most of Obama’s Clean Power Plan regulations, allowing current coal-fired plants to remain open longer, which in turn would keep more people employed. But in an interview with the Ohio Valley Resource, James Van Nostrand, a law professor and director of West Virginia University’s Center for Energy and Sustainable Development, believes the new rule may only help keep those people employed in the short term. With low natural gas prices and the continually falling cost of producing energy from renewable sources like wind and solar, Van Nostrand said it is difficult to make the economics of coal continue to work.

Inevitably, the competitive price of energy produced by those industries will cause a continual decline in coal related jobs. That is already coming to fruition according to a report by the Kentucky Energy and Environment Cabinet that shows coal mining jobs in that state from April to June of 2018 decreased 4.8 percent from the same period in 2017.

A report done by West Virginia University’s Bureau of Business and Economic Research shows that coal production in West Virginia has increased almost 27 percent since 2016, due mostly to a growth in coal exports to countries such as Brazil, India and Ukraine. But the report also shows that the increase will be short-lived, and the number is estimated to drop by about 3 percent in the next two years.

According to an analysis by the Environmental Protection Agency, coal produced in the U.S. is predicted to decline overall, with coal mines producing about 78 percent less coal in 2035 than in 2017.

Coal is not the only factor that can make or break the economic health of Appalachian communities, however. The region’s opioid epidemic also plays a role. Substance abuse has ravaged Appalachia, with states like Ohio, Kentucky and West Virginia experiencing 20-, 11.5- and 32-percent increases, respectively, in opioid overdose deaths from 2016 to 2017. Although, West Virginia’s Chief Health Officer Dr. Rahul Gupta believes the rate of overdose deaths will soon flatten due to harm-reduction programs like needle exchanges, safe injection sites and mobile clinics becoming more prevalent and making treatment more accessible in his state and others.

Many of the counties deemed to have the highest risk for outbreaks of potential needle-borne diseases like HIV and Hepatitis C by researchers at the Centers for Disease Control and Prevention are also those the ARC deemed to be the most distressed economically.