The economy of Appalachia traditionally rested on agriculture, mining, timber, and in the cities, manufacturing. Since the late 20th century, tourism and second-home developments have assumed an increasingly major role. Appalachia has many different economic sectors, from aerospace and defense industries in the
Greater Huntsville area in the southern part of Appalachia to tourism in many areas such as the
Great Smoky Mountains and the
Blue Ridge Parkway.
Agriculture While the climate of the Appalachian region is suitable for agriculture, the region's hilly terrain greatly limits the size of the average farm, a problem exacerbated by population growth in the latter half of the 19th century.
Subsistence farming was the backbone of the Appalachian economy throughout much of the 19th century, and while economies in places such as western Pennsylvania, the
Great Valley of Virginia, and the upper Tennessee Valley in east Tennessee, transitioned to a large-scale farming or manufacturing base around the time of the Civil War, subsistence farming remained an important part of the region's economy until the 1950s. In the early 20th century, Appalachian farmers were struggling to mechanize, and abusive farming practices had over the years left much of the already-limited farmland badly eroded. Various federal entities intervened in the 1930s to restore damaged areas and introduce less harmful farming techniques. In recent decades, the concept of
sustainable agriculture has been applied to the region's small farms, with some success. Nevertheless, the number of farms in the Appalachian region continues to dwindle, plunging from 354,748 farms on in 1969 to 230,050 farms on in 1997. Early Appalachian farmers grew both crops introduced from their native Europe as well as crops native to North America (such as
corn and
squash). Tobacco has long been an important
cash crop in Southern Appalachia, especially since the land is ill-suited for cash crops such as cotton. Apples have been grown in the region since the late 18th century, their cultivation being aided by the presence of thermal belts in the region's mountain valleys. Hogs, which could
free range in the region's abundant forests, often on
chestnuts, were the most popular livestock among early Appalachian farmers. The
American chestnut was also an important human food source until the
chestnut blight struck in the 20th century. The early settlers also brought cattle and sheep to the region, which they would typically graze in highland meadows known as
balds during the growing season when bottomlands were needed for crops. Cattle, mainly the
Hereford,
Angus, and
Charolais breeds, are now the region's chief livestock. The first major logging ventures in Appalachia transported logs using mule teams or rivers, the latter method sometimes employing
splash dams. In the 1890s, innovations such as the
Shay locomotive, the steam-powered loader, and the steam-powered
skidder allowed massive harvesting of the most remote forest sections.
Coal mining , photographed by
Ben Shahn in 1935 Coal mining is the industry most frequently associated with the region in outsiders' minds, due in part to the fact that the region once produced two-thirds of the nation's coal. At present, however, the mining industry employs just 2% of the Appalachian workforce. The region's vast coalfield covers between northern Pennsylvania and central Alabama, mostly along the
Cumberland Plateau and
Allegheny Plateau regions. Most mining activity has been concentrated in eastern Kentucky, southwestern Virginia, West Virginia, and western Pennsylvania, with smaller operations in
western Maryland,
Tennessee and
Alabama. The
Pittsburgh coal seam, which has produced 13 billion tons of coal since the early 19th century, has been called the world's most valuable mineral deposit. There are over 60 major coal seams in West Virginia and over 80 in eastern Kentucky. Most of the coal mined is
bituminous, although significant
anthracite deposits exist on the fringe of the region in central Pennsylvania. About two-thirds of Appalachia's coal is produced by
underground mining, the rest by
surface mining.
Mountaintop removal, a form of surface mining, is a highly controversial mining practice in central Appalachia due to its negative impacts on the environment and health of residents. Coal mining has made a comeback in some regions in the early 21st century because of the increased prominence of
Consol Energy, based in
Pittsburgh. The
Quecreek Mine rescue in 2002 and continuing
mine subsidence problems in abandoned coal mines in
western Pennsylvania as well as the
Sago Mine disaster and
Upper Big Branch Mine disaster in West Virginia and other regions have also been highlighted in recent times.
Manufacturing plant along the
Kanawha River in West Virginia, photographed late 1930s/early 1940s The manufacturing industry in Appalachia is rooted primarily in the ironworks and steelworks of early
Pittsburgh and
Birmingham, and in the textile mills that sprang up in North Carolina's
Piedmont region in the mid-19th century. Factory construction increased greatly after the Civil War, and the region experienced a manufacturing boom between 1890 and 1930. This economic shift led to a mass migration from small farms and rural areas to large urban centers, causing the populations of cities such as Birmingham,
Knoxville, Tennessee, and
Asheville, North Carolina, to swell exponentially. Manufacturing in the region suffered a setback during the Great Depression but recovered during World War II and peaked in the 1950s and 1960s. However, difficulties paying retiree benefits, environmental struggles, and the signing of the
North American Free Trade Agreement (NAFTA) in 1994 led to a decline in the region's manufacturing operations. Pittsburgh lost 44% of its factory jobs in the 1980s, and between 1970 and 2001, the number of
apparel workers in the Appalachian region decreased from 250,000 to 83,000 and the number of textile workers decreased from 275,000 to 193,000.
U.S. Steel, founded in Pittsburgh in 1901, was the world's first corporation with more than a billion dollars in initial capitalization.
Union Carbide built the world's first
petrochemical plant in
Clendenin, West Virginia, in 1920, and in subsequent years the
Kanawha Valley became known as the "Chemical Capital of the World".
Eastman Chemical, also established in 1920, is Tennessee's largest single employer. Companies such as Champion Fibre and
Bowater established large
pulp operations in
Canton, North Carolina, and
Greenville, South Carolina, respectively, although the former was dogged by battles with environmentalists throughout the 20th century.
Tourism , a resort hotel in
Bath County, Virginia, photographed in 1903 One of the region's oldest industries, tourism became a more important part of the Appalachian economy in the latter half of the 20th century as mining and manufacturing steadily declined. In 2000–2001, tourism in Appalachia accounted for nearly $30 billion and over 600,000 jobs. The mountain terrain—with its accompanying scenery and outdoor recreational opportunities—provides the region's primary attractions. and the nation's most visited national parkway (the
Blue Ridge Parkway). The
craft industry, including the teaching, selling, and display or demonstration of regional crafts, also accounts for an important part of the Appalachian economy, bringing (for example) over $100 million annually to the economy of western North Carolina and over $80 million to the economy of West Virginia. Important
heritage tourism attractions in the region include the
Biltmore Estate and the
Eastern Band of the Cherokee reservation in North Carolina,
Cades Cove in Tennessee, and
Harpers Ferry in West Virginia. Important theme parks include
Dollywood and
Ghost Town Village, both on the periphery of the
Great Smoky Mountains. The mineral-rich mountain springs of the Appalachians—which for many years were thought to have health-restoring qualities—were drawing visitors to the region as early as the 18th century with the establishment of resorts at
Hot Springs, Virginia,
White Sulphur Springs, West Virginia, and what is now
Hot Springs, North Carolina. Along with the
mineral springs, the cool and clear air of the range's high elevations provided an escape for lowland elites, and elaborate hotels—such as
The Greenbrier in West Virginia and the
Balsam Mountain Inn in North Carolina—were built throughout the region's remote valleys and mountain slopes. The end of World War I (which opened up travel opportunities to Europe) and the arrival of the automobile (which changed the nation's vacation habits) led to the demise of all but a few of the region's spa resorts. The establishment of national parks in the 1930s brought an explosion of tourist traffic to the region but created problems with
urban sprawl in the various host communities. In the late 20th and early 21st centuries, states have placed greater focus on sustaining tourism while preserving host communities. In Appalachia, severe poverty and desolation were paired with the necessity for careful cultural sensitivity. Many Appalachian people feared that the birth of a new modernized Appalachia would lead to the death of their traditional values and heritage. Because of the isolation of the region, Appalachian people had been unable to catch up to the modernization that lowlanders had achieved. In the 1960s, many people in Appalachia had a
standard of living comparable to
Third World countries. Lyndon B. Johnson declared a
War on Poverty while standing on the front porch of an
Inez, Kentucky, home whose residents had been suffering from a long-ignored problem. The Appalachian Regional Development Act of 1965 stated: Since the creation of the Appalachian Regional Commission (ARC) in 1965, the region has seen dramatic progress. New roads, schools, health care facilities, water and sewer systems, and other improvements have brought a better life to many Appalachian residents. In the 1960s, 219
counties in the 13-state Appalachian Region were considered economically distressed. Now that list has been cut by more than half, to 82 counties, but these are "hard-core" pockets of poverty, seemingly impervious to all efforts at improving their lot.
Martin County, Kentucky, the site of Johnson's 1964 speech, is one such county still ranked as "distressed" by the ARC. As of 2000, the per capita income in Martin County was $10,650, and 37% of its residents lived below the poverty line. Like Johnson, President
Bill Clinton brought attention to the remaining areas of poverty in Appalachia. On July 5, 1999, he made a public statement concerning the situation in
Tyner, Kentucky. Clinton told the crowd: The region's poverty has been documented often since the early 1960s.
John Cohen documents rural lifestyle and culture in
The High Lonesome Sound, while
photojournalist Earl Dotter has been visiting and documenting poverty, healthcare and mining in Appalachia for nearly forty years. Another photojournalist,
Shelby Lee Adams, has been photographing Appalachian families and lifestyle for decades. Poverty has caused health problems in the region. The
diseases of despair, including the
opioid epidemic in the United States, and some
diseases of poverty are prevalent in Appalachia.
Tax revenue and absentee land ownership In 1982 a seven-volume study conducted by the Appalachian Land Ownership Task Force was issued by the Appalachian Regional Commission which investigated the issue of absentee land ownership. The study covered 80 counties in six states approximating the area designated "Southern Appalachia" as defined by Thomas R. Ford's 1962 work. The states selected were Alabama (15 counties), Kentucky (12 counties), North Carolina (12 counties), Tennessee (14 counties), Virginia (12 counties), and West Virginia (15 counties). In its summary the report stated that "over 55,000 parcels of property in 80 counties were studied, representing some 20,000,000 acres of land and mineral rights..." It found that "41% of the 20 million acres of land and minerals...are held by only 50 private owners and 10 government agencies. The federal government is the single largest owner in Appalachia, holding over 2,000,000 acres." The study found that the extractive industries, i.e., timber, coal, etc., were "greatly under-assessed for property tax purposes. Over 75% of the mineral owners in this survey pay under 25 cents per acre in property taxes." In the major coal counties surveyed the average tax per ton of known coal reserves is only $.0002 (1/50th of a cent). The government-held lands are tax-exempt, but the government makes a
payment in lieu of taxes, which is usually less than the normal tax rates. "Taken together, the failure to tax minerals adequately, the underassessment of surface lands, and the revenue loss from concentrated federal holdings has a marked impact on local governments in Appalachia. The effect, essentially, is to produce a situation in which a) the small owners carry a disproportionate share of the tax burden; b) counties depend upon federal and state funds to provide revenues, while the large, corporate and absentee owners of the region's resources go relatively tax-free; and c) citizens face a poverty of needed services despite the presence in their counties of taxable property wealth, especially in the form of coal and other natural resources." In 2013, a similar study that concentrated solely on West Virginia found that 25 private owners hold 17.6% of the state's private land of 13 million acres. The federal government owns 1,133,587 acres in West Virginia, 7.4% of the total state acreage of 15,410,560 acres. In 11 counties the top ten absentee landowners own 41% to almost 72% of the private land in each county.
Appalachian Regional Commission The
Appalachian Regional Commission (ARC) was created by the
U.S. Congress in 1965 to bring poor areas of the 13 U.S. states of the main (southern) range of the Appalachians into the mainstream of the American economy. The commission is a partnership of federal, state, and local governments, and was created to promote economic growth and improve the quality of life in the region. The region as defined by the ARC includes 420 counties, including all of West Virginia; counties in 12 other states: Alabama, Georgia, Kentucky, Maryland, Mississippi, New York, North Carolina, Ohio, Pennsylvania, South Carolina, Tennessee, and Virginia; and also eight
cities in Virginia, where state law makes cities administratively separate from counties. The ARC is a planning, research, advocacy and funding organization; it does not have any governing powers. The ARC's geographic range of coverage was defined broadly to cover as many economically underdeveloped areas as possible; it extends well beyond the area usually thought of as "Appalachia". For instance, parts of Alabama and Mississippi were included in the commission because of problems with unemployment and poverty similar to those in Appalachia proper, and the ARC region extends into the
Northeastern states, which are not traditionally considered part of Appalachia culturally (though a "northern Appalachia" identity has emerged in recent times in parts of both NY and PA, particularly in rural areas). More recently, the
Youngstown, Ohio, region was declared part of Appalachia by the ARC due to the
collapse of the steel industry in the region in the early 1980s and the continuing unemployment problems in the region since, though aside from
Columbiana County, Ohio, the Youngstown
DMA is not traditionally or culturally considered part of the region. The ARC's wide scope also grew out of the "
pork barrel" phenomenon, as politicians from outside the traditional Appalachia area saw a new way to bring home federal money to their areas. However, former Ohio governor
Bob Taft has stated, "What is good for Appalachia is good for all of Ohio."
Transportation in West Virginia is the longest steel span in the western hemisphere and at , the third highest in the United States. Transportation has been the most challenging and expensive issue in Appalachia since the arrival of the first European settlers in the 18th century. Except the October 1, 1940, opening of the
Pennsylvania Turnpike, the region's mountainous terrain continuously thwarted major federal intervention attempts at major road construction until the 1970s. This left large parts of the region virtually isolated and slowing economic growth. Before the Civil War, major cities in the region were connected via wagon roads to lowland areas, and
flatboats provided an important means for transporting goods out of the region. By 1900, railroads connected most of the region with the rest of the nation, although the poor roads made travel beyond railroad hubs difficult. When the Appalachian Regional Commission was created in 1965, road construction was considered its most important initiative, and in subsequent decades the commission spent more on road construction than all other projects combined. The effort to connect Appalachia with the outside world has required numerous civil engineering feats. Millions of tons of rock were removed to build road segments such as
Interstate 40 through the
Pigeon River Gorge at the Tennessee-North Carolina state line and
U.S. Route 23 in
Letcher County, Kentucky. Large tunnels were built through mountain slopes at
Cumberland Gap in 1996 to speed up travel along
U.S. Route 25E, which acts as a regional arterial connecting Appalachia to the East Coast and the Great Lakes regions. The
New River Gorge Bridge in West Virginia, completed in 1977, was the longest and is now the
fourth-longest single-arch bridge in the world. The Blue Ridge Parkway's
Linn Cove Viaduct, the construction of which required the assembly of 153 pre-cast segments up the slopes of
Grandfather Mountain, ==Physiographic provinces==