According to Watters, the Office of Management and Budget directed the Census Bureau to list Hispanic as an ethnic group, not a race, reasoning that Hispanics may be of any race. “Despite the federal government’s official position, many Hispanics think of themselves as Hispanic by race,” Watters said, pointing out that recent data released for Alabama tends to confirm that people might have had trouble with that question on the census form.

For example, Watters said, nearly 49 percent of Alabama Hispanics listed their race as white. About 8 percent thought of themselves as Black or African American Hispanics. A few hundred listed themselves as American Indian, Asian, or Pacific Islander Hispanics. But a large number, 35 percent, chose “None of the Above.”

“They were sure they are Hispanic, but they didn’t identify with any of the race choices, perhaps because they think Hispanic is their race,” Watters said.

An additional 5,000 of Alabama’s Hispanic population, or about 7 percent, marked that they are two or more races. Overall in Alabama, less than 1 percent of the population marked two or more races.

“The suspicion is that the Hispanics who marked two or more races were considering Hispanic to be one of the two (or more) racial groups to which they belong,” Watters said. “Even though the federal government doesn’t recognize Hispanic as a race, that doesn’t change people’s perceptions of themselves. And the data we get from the census come from the way people marked their forms.”

Census information about any county in Alabama can be obtained at http://cber.cba.ua.edu.

The University of Alabama’s Culverhouse College of Commerce and Business Administration, founded in 1919, first began offering graduate education in 1923. Its Center for Business and Economic Research was created in 1930, and since that time has engaged in research programs to promote economic development in the state while continuously expanding and refining its base of socioeconomic information.

According to Watters, the number of houses held for seasonal, recreational, or occasional use increased 32 percent during the 1990s, or 11,457 more housing units of that category in 2000 than in 1990.

“In fact, 2.4 percent of all the housing units in Alabama are second homes of some kind,” Watters said. “These seasonal or recreational housing units could be a condo at the beach, a cabin on the lake, a mobile home in the country as a hunting or fishing retreat, or any other variety of permanent housing a person or family might use occasionally during the year.”

Areas of Alabama with a tourism industry show a bigger percent of this category of housing than other areas of the state, Watters said. “For example, 16 percent of all the housing units in Baldwin County are for seasonal, recreational, or occasional use rather than for permanent, fulltime residents.”

“Baldwin County is a fast-growing part of the state, but not all its growth is tourism related. Most of the housing growth there during the last decade was in owner-occupied homes. Baldwin County’s growth can be attributed to more than one reason. An apt analogy for Baldwin County is that a rising tide floats many boats,” she said.

An improving economy also made a difference in the mix of homeowners versus renters in Alabama over the last decade, Watters said. “Owner-occupied housing increased by 18.5 percent, versus a 7.6 percent increase in renter-occupied housing. There were 293,332 more owner-occupied houses in Alabama in 2000 than in 1990,” she said.

According to Watters, African-American home ownership increased at a faster rate than white home ownership. “Blacks in the state had some catching up to do because home ownership has never been as prevalent among African-Americans as among whites. Home ownership by blacks increased much faster than for Alabama’s white population.”

“Even though Alabama’s black households were increasingly likely to be owners rather than renters, in 2000 there was still a large percentage of the black population who were renters. Forty-three percent of the state’s black households were renting and 57 percent were buying their homes. By contrast, 22 percent of white households were renting and 78 percent were homeowners.”

The University of Alabama’s Culverhouse College of Commerce and Business Administration, founded in 1919, first began offering graduate education in 1923. Its Center for Business and Economic Research was created in 1930, and since that time has engaged in research programs to promote economic development in the state while continuously expanding and refining its base of socioeconomic information.

Per Capita Income Loses Ground

Per capita personal income (PCPI) reached $23,471 in Alabama for 2000, 79.1 percent of the U.S. average of $29,676. The Bureau of Economic Analysis (BEA) calculates this widely used measure of economic well-being as earnings; dividends, interest, and rent; and transfer payments per resident. During the 1990s, Alabama per capita income rose 48.2 percent, while U.S. per capita income increased 51.5 percent. Below average gains dropped Alabama’s per capita income ranking from 42nd in 1990 to 44th in 2000. Yet Alabama has come a long way in the 50 years since 1950 when per capita income of $909 was 60.2 percent of the U.S. average and ranked 48th. Still there is cause for concern that after steadily closing the gap in the decades of the 1950s through the 1980s, Alabama has fallen behind in the 1990s.

Wide Disparities Remain Among Counties

In 1999, the latest year for which county per capita income is available, Alabama’s estimated per capita income of $22,972 amounted to 80.5 percent of the U.S. average. Per capita income in Alabama’s 67 counties varied widely, however, as seen in Figure 1. Residents of only two counties, Jefferson and Shelby, had incomes exceeding the U.S. average of $28,546. Another seven counties—Baldwin, Coffee, Houston, Madison, Montgomery, Morgan, and Tuscaloosa—fell below the national but above the state average. In 41 counties, per capita income was below the state but above 65 percent of the U.S. average. Income in Alabama’s 17 poorest counties fell below 65 percent of U.S. per capita income in 1999.

There is a wide disparity among Alabama’s richest and poorest counties. Per capita income averaged $15,420 in Alabama’s six poorest counties in 1999, just 57.1 percent of the $27,002 average for the six wealthiest. The gap between the bottom six and the top six narrowed considerably in the ten years from 1969 to 1979, with the ratio rising from 46.3 percent to 60.1 percent. However, a sizeable difference between rich and poor remains and has widened since 1979, with the 1999 ratio at 57.1 percent.

Over the last 31 years, Alabama’s poor counties have generally stayed poor and the rich have stayed rich. Only 11 of the state’s 67 counties have cracked the top six in per capita income during this time, as shown in Table 1. Four counties—Jefferson, Madison, Montgomery, and Morgan—have been there every year; Shelby joined in 1971. Baldwin, which was in the group for a few years in the late 1970s, displaced Houston in the top six in 1996. Many of Alabama’s poorest counties have also been in the cellar for most of the last 31 years. Greene and Perry have always been there; Lowndes, Sumter, and Wilcox have been there well over 20 years, including 1999; and Hale, which spent 27 years in the bottom six, now ranks seventh from the bottom. Macon, also in the bottom six in 1999, has been in the group for about half of the last 31 years, as has Bullock, which was just above, at 60th, in 1999.

Long-term Income Growth Varies

Some Alabama counties have been much more successful than others in fostering and attracting well-paying jobs that can improve the economic status of their residents. Most Alabama counties saw their per capita income rankings change between 1969 and 1999, with about half going up and half down (see Table 2). Several counties, including Calhoun and Dale, saw income rankings decline as a result of outside factors—in these cases, a reduced military presence. Others lacked the resources to compete as economies evolved in the wake of burgeoning technology.

In general, counties in metropolitan areas fared better than their nonmetro counterparts. Alabama’s 22 MSA counties averaged per capita incomes of $24,482 in 1999, or 106.6 percent of the Alabama average of $22,972. Residents of the state’s 45 nonmetro counties had, on average, just 79.3 percent of the income of metro area residents. This gap has narrowed slightly since 1969 when nonmetro income was 74.0 percent of the metro average.

Income Inequality Increasing

Income inequality among Alabama’s families grew over the last two decades. Using data from the Census Bureau’s March Current Population Surveys, the Public Policy Institute studied income changes for population quintiles in each state during the late 1970s, 1980s, and 1990s. In 46 states, including Alabama, the income gap between the richest and poorest 20 percent of families widened. From the late 1970s to the late 1990s, Alabama’s wealthiest families saw the largest increases in real income (38 percent, or $33,000), while Alabama’s poorest families experienced the smallest gains (17 percent, or $1,610). (See Figure 2.) In contrast, however, the poorest fifth of families in 18 states faced real income declines. The income gap between Alabama’s richest and poorest ranked 11th worst among the 50 states, while the discrepancy between the richest and middle fifths ranked 24th. In the late 1990s, Alabama’s poorest families held 5 percent of the state’s income (Figure 3), while the wealthiest families held 45 percent.

Economic Prosperity Not Equally Shared

Across Alabama, economic prosperity has not been shared equally between Alabama counties and among residents of each county. Interrelated factors, including long-standing poverty, low education levels, and lack of economic opportunity, are depressing income growth in Alabama. Wage inequality among the highest paid and middle- to low-wage workers has increased. Globalization, declining manufacturing jobs, expanding low-wage service and trade jobs, and weakening of labor market institutions have contributed to the erosion of wages for workers without technical or college training.

Only by helping her poorest citizens become educated, productive participants in the state’s economy, by developing tax policies that help mitigate the effects of increased income inequality, and by attracting and nurturing higher wage jobs can Alabama pull itself out of the income cellar.

Of the 67 counties in Alabama, there are 10, all in the Black Belt region, having a black majority. Conversely, there are 13 counties, all in the northern half of the state, where less than 10 percent of the population is African American.

Asian. Nationally, 0.9 percent of the American population is Asian. In Alabama 0.7 percent is Asian, accounting for 31,346 people. The Asian presence is small and highly concentrated in a few counties, largely in the metro areas. Jefferson, Madison, and Mobile Counties each have more than 5,000 Asians. Montgomery, Lee, Tuscaloosa, and Shelby have 2,200 or fewer each, and other counties’ numbers drop off sharply from there. Several counties have fewer than 10 Asian persons living there.

Hispanic. No county in Alabama comes close to approximating the U.S. Hispanic population share. Nationally, 12.5 percent of the American population is Hispanic. Counties in Alabama that have seen an influx of Hispanics in the last decade now have 5 to 7 percent Hispanic population. Some counties have experienced very little Hispanic immigration at all. Just 28 Alabama counties account for 81 percent of the state’s Hispanic population. Several counties have fewer than 100 Hispanic people. The largest concentration of Hispanics, 10,284, is in Jefferson County, accounting for 1.6 percent of Jefferson County’s total. Other Deep South metro areas—Charlotte, Raleigh-Durham-Chapel Hill, Greensboro-Winston Salem-High Point, Atlanta— experienced 300 to 600 percent increases in Hispanic population during the 1990s and have Hispanic populations tens of thousands greater than Birmingham’s.

The diffusion of minorities across Alabama is less rapid and far less pervasive than recent press accounts imply. While residents in Alabama counties with no Hispanic presence a decade ago have been talking about the recent difference, broadly speaking, Alabama is still an ethnic frontier for immigrant minorities. We can expect ethnic pioneers to continue trekking into Alabama during the current decade; Census 2010 should have a new and different story to tell.

Annette Jones Watters

The statewide housing affordability index is calculated as the ratio of the state’s actual median family income to the income needed to purchase and finance the state’s median priced home. An index number of 100 means that a family earning the state’s median income of $46,056 has just enough buying power to qualify for a mortgage loan on the state’s median priced, single-family home. The higher the index number, the more affordable the housing.

An index number of 179 means that Alabama families earning the statewide median income had more than 1.75 times the income needed to qualify for conventional financing of the statewide median priced home, which in the second quarter was $99,196. Households earning the statewide median income of $46,052 could afford to buy a home priced as high as $177,556 using conventional financing, a 20 percent down payment and a 30-year term.

At the national level, housing affordability actually fell during the second quarter of the year, declining to 138.2 from 142.9 in the first quarter. In large part the decline in nationwide housing affordability was due to the sharp increase in the national median home price to $147,067 in the second quarter; a $7,367 increase over the first quarter median price of $139,700.

According to Dr. Leonard Zumpano, director of the Center, a combination of lower mortgage interest rates and a small decline in the statewide median home price explain the increase in housing affordability for Alabama.

The median price for existing, single-family homes in the second quarter was $99,196, representing a decline of $1,949 from the first quarter of the year, Zumpano said. The average residential mortgage loan rate used in the computation of the housing affordability index was 7.14 percent, down 6 basis points during the first quarter of 2001.

Within Alabama, housing affordability fell in 6 of the state’s 11 metropolitan areas, while rising in Auburn/Opelika, Decatur, Dothan, Florence, and Tuscaloosa. “These are the same metro areas that experienced a fall in median home prices during the second quarter,” Zumpano said.

“Huntsville still leads all the other state metro areas in housing affordability with an HAI of 222. The metro area with the lowest housing affordability continues to be the Mobile area, which largely reflects the impact of Baldwin County’s very high median home price. At $145,833 in the second quarter, Baldwin County had the highest existing home prices within the state. This, in turn, largely reflects the impact of the very strong market for recreational and vacation homes in the county.”

Zumpano said that at the national level, the economy continued to erode during the second quarter, even bringing down the housing sector, which up until now had remained very strong despite the sagging economy. In Alabama, however, the housing market continues to be robust in most metro locations, he said. “In large part, this reflects the fact that unemployment has remained relatively low within the state’s major metro areas, and the Alabama economy has remained strong.”

Zumpano said a large number of economists and market analysts seem to believe that the sluggish economy has just about bottomed out and the second half of the year will see a slight rebound in economic activity.

“If this is the case, look for the housing sector to finish the year on an up note, “he said. “However, the risks to the housing market are mounting. If the U.S economy continues to soften and unemployment, which has been largely confined to the high-tech sector, continues to rise, this could spill over into the housing sector.

“On the plus side this could induce the Fed Reserve to reduce interest rates yet again. Mortgage interest rates have continued to decline since the end of the second quarter and if housing prices moderate over the coming months, this will represent a major buying opportunity for consumers contemplating the purchase of a home.”

The Alabama Real Estate Research and Education Center is part of The University of Alabama’s Culverhouse College of Commerce and Business Administration. The UA business school, founded in 1919, has been recognized repeatedly during the 1990s for offering a high-quality, cost-effective education.

The figures were released today (August 31, 2001) by the U.S. Census Bureau and analyzed by The University of Alabama Center for Business and Economic Research’s Alabama State Data Center.

An estimated 15.7 percent of the state lived in poverty in 1998, the year for which figures were most recently released. That amounts to 681,788 people. The national poverty rate is 12.7 percent of the population.

Annette Watters, manager of the Alabama State Data Center, which is housed at UA, said the poverty situation was grimmer for the state’s youngest citizens. Twenty-three percent, or more than one out of every five children in the state, are living below the poverty line.

“The statistics for babies and small children is the worst news of all,” Watters said. “There are more than a quarter of a million children under 18 living in poverty in this state. Of those, 81,804 are babies and pre-schoolers below the age of five. More than a quarter of all the children under the age of five in this state live in poverty.”

Watters said the high number of children in poverty has great social and financial implications for the state. She cites greater health care costs and higher mortality rates among poor families as examples.

“Poverty among children is an obstacle to the economic development of a state,” Watters explained. “The economic development of an area is retarded when a lot of the local resources are used to take care of high numbers of people living in poverty.”

She said education and job training are the remedies to the state’s poverty problem. “Poverty is closely related to low educational attainment,” she explained. “Good jobs go to people with skills, and poorly educated people don’t qualify for those good jobs. Low-skill people don’t have the ability to pull themselves out of poverty.”

The bit of good news from the recent report is that Alabama’s poverty rate has been decreasing. In 1996, 17.1 percent of Alabamians lived in poverty. By 1998, that rate had decreased to 15.7 percent. The bad news is that most states’ poverty rate was decreasing faster than Alabama’s. Where the state ranked number 10 in poverty status in 1996, it ranked number 8 in 1998 for poverty among people of all ages and number 7 for poverty among children.

States ahead of Alabama with the highest child poverty include Washington, D.C., ranked number one, followed by New Mexico, Louisiana, West Virginia, Mississippi, and Arkansas.

Chart accompanied.

Alabama Urbanized Areas and their UA Population
Anniston 75,840
Auburn 60,137
Birmingham 663,615
Decatur 52,315
Dothan 60,792
Florence 71,299
Gadsden 61,709
Huntsville 213,253
Mobile 317,605
Montgomery 196,892
Tuscaloosa 116,888

Three Alabama urbanized areas have had significant changes:

1. Gadsden—does not include significant portions of the 1990 Census UA, which did not qualify for inclusion in the Census 2000 UA.
2. Montgomery—does not include the separate Prattville, Alabama Urban Cluster, which was defined from part of the 1990 census UA.
3. Auburn—was Auburn-Opelika, but is now called Auburn.

As a result of Census 2000, there are 453 urbanized areas in the United States, plus a few others in Puerto Rico and the other outlying territories. This is an increase from the 405 urbanized areas based on the 1990 census. The increase results from some entirely new urbanized areas, plus some that were created from splitting existing areas, minus 29 areas that were combined, and one that failed to qualify under the new criteria.

Under the new rules, many nonresidential areas that would be perceived as clearly part of the urban framework (for example, industrial, commercial, and other types of developed areas with employment) do not qualify for inclusion in a Census 2000 urban area. The Census Bureau is continuing research to determine if there are objective and consistent ways to address issues involving inclusion of nonresidential urban land uses in urban areas in future censuses.

This notice also alerted readers that in the future the Federal Register will make available the lists of the urban clusters and the major airports evaluated for inclusion in qualifying urbanized areas and urban clusters.

A complete list of the urbanized areas and urban clusters and the list of central places will be available from the Census Bureau’s Urban and Rural Classification Web page at:
http://www.census.gov/geo/www/ua/ua_2k.html

The TIGER/Line files that contain the boundaries, names, and codes of urbanized areas and urban clusters will be available from the Census Bureau’s TIGER/Line Web page at:
http://www.census.gov/geo/www/tiger/index.html

Maps produced by the Census Bureau showing the boundaries and component geographic entities of urbanized areas and urban clusters will be available in late 2002. Data users should monitor the Rural Classification Web page mentioned above to find exactly when the maps will be available.