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Census Shows Prosperity Gap Widening in KY

The loss of coal-industry jobs is a big part of widening prosperity gap between eastern Kentucky and rest of state. Credit: Greg Stotelmyer
The loss of coal-industry jobs is a big part of widening prosperity gap between eastern Kentucky and rest of state. Credit: Greg Stotelmyer
September 21, 2015

BEREA, Ky. - While the U.S. Census Bureau's new numbers show Kentucky's poverty rate remains basically unchanged, one economic policy analyst says mining deeper into the numbers uncovers a much bigger problem facing the state's Appalachian coal region.

Ashley Spalding, research and policy associate at the Kentucky Center for Economic Policy, says the poverty rate has increased two-and-a-half percentage points in eastern Kentucky, to above 29 percent.

"Well certainly, the loss of coal jobs is a big part of the economic situation that we see in Kentucky's Fifth Congressional District," says Spalding. "We're really seeing a widening of the prosperity gap between eastern Kentucky and the rest of the state."

Kentucky's overall poverty rate is about 10 percent lower, at around 19 percent, which Spalding says is nearly two full percentage points higher than in 2007, just before the recession hit.

She believes policy changes, such as a higher minimum wage and tax reform, could help kick-start the state's economy.

"We also need federal investments, like the Power Plus Plan, that will create jobs in eastern Kentucky," she says.

Through its POWER+ Plan, The Obama administration has proposed channeling $1 billion over five years into communities hit by the sharp decline in coal production, to help diversify local economies, add jobs and retrain workers.

Greg Stotelmyer , Public News Service - KY