Year of Publication

2014

College

Martin School of Public Policy and Administration

Executive Summary

The coal debate seems to be in a state of inertia. Proponents of coal claim the industry brings economic benefit to Kentucky. Environmentalists claim the industry creates irreparable harm to the Appalachian Mountain region. While these opinions are not unfounded, seldom do stakeholders explore the impact incurred directly in the Appalachian communities that mine coal. Moving the debate to a discussion about coal’s direct impact in the communities that support the industry may broaden stakeholders’ perspective. Determining whether the industry helps or harms the Appalachian community may be the break in the debate’s stalemate. Thus, this paper explores the socioeconomic impact of the coal industry in Eastern Kentucky.

To measure the socioeconomic impact, the parameters of “socioeconomic” must be defined. For the purposes of this research, socioeconomic includes median household income, poverty rates and age-adjusted mortality. When median household income was measured against coal mining employment percentages, an inverse relationship was revealed; a 1 percent increase in coal mining employment could decrease median income by 152 dollars. Also, a direct impact was revealed between coal mining employment and poverty rates; when coal mining employment increased by one percent, poverty increased by .003 percent. Lastly, as coal mining employment increased by 1 percent, age-adjusted mortality increased by approximately 9 lives.

The issue of coal is no longer a normative topic of debate. Recent studies show that coal’s presence in Eastern Kentucky is declining, both in terms of mineral reserve and employment opportunities. Stakeholders must acknowledge this potentially devastating economic event. An economic transition strategy is necessary to protect Appalachian economies from collapsing when the coal industry substantially declines. It is far more prudent to take measures now to ensure a smooth transition rather than wait for a collapse and plan for recovery.

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