History and Current Trends

The Town of Honaker is a town of less than 2,000 persons in Russell County, Virginia. It is a 20 minute drive from the county seat, Lebanon, its largest economic competitor, and less than an hour drive from Abingdon. Over the last 30 years, road improvements and commercial, "big box" development in Lebanon and Richlands have greatly drained away the regional market of shoppers who used to frequent Honaker.

The basic demographics for the community are typical of a small rural community in decline: aging population, low incomes, declining buying power.

Demographic Indicators
Until the recent boundary adjustment that roughly doubled the population to 2,000 residents, the population of the Town has been relatively stable for the past 30 years at just under 1,000, The Russell County population has by contrast been in steady decline over many years, but that has recently experienced a turnaround with the addition of new regional economic growth.

The Town's population is aging. The median age is slightly above the state average at 39 years old, however, this is projected to increase significantly during the decade.

Honaker lags significantly behind the State and region in terms of income and wealth. The average income of $23,900 is less than half of the State average. More significantly, 27% of households in Honaker have incomes that fall below the poverty level - three times the state average.

Not surprisingly, the cost of living is lower as well, with an index of 91 (compared to the US average of 100). Lower costs also translate to the housing market where rents and mortgage payments are only one third of the State average. The average home value is estimated at $113,600 in 2007, still well below the state average of $212,300 but reflecting a dramatic rise since the start of the decade. Since home value is the primary route to wealth development in the US, this has a negative impact on community wealth.

Perhaps the most distressing aspect of the Town's housing stock is that over 13% of the housing units are not occupied - three times the state average. This reflects both the economic decline of the community as well as the high incidence of deteriorated structures. An additional 29% of the town's housing is mobile homes.

Economic Buying Power
The buying power within the community is limited due to the low level of incomes. The "Spending Potential Index" for the Town is 48 (100 is the national average). The only industry area where this is slightly higher is for medical/health care related spending - reflecting Medicare/Medicaid expenditures typical of a lower income, aging population. The ESRI data reflects retail "leakage", expenditures being lost to outside retailers, in nearly all industry classifications.

Labor Force
Today half of the people who live in Honaker drive at least on-half hour from the town to their jobs and those jobs are held mostly in the construction, transportation and education areas. Young people who graduate from Honaker High School are likely to leave the area for work and greater opportunity. Unemployment remains low at under 5% but participation in the labor force is also very low at 47%, well below the state average of 67%.

Social Indicators
Education levels for the Town are below the state averages but the school system and especially the High School are good performers and a source of intense pride in the community. The High School graduation rate is 82% and the building serves as one of the cultural and social centers for the Town.

Crime is not an issue in Town - ranking in the lowest quartile for the State. Town residents trail the state averages for many health indicators but teen pregnancy is below the State average. There is, however, a growing concern in the community about drug use and its spread within the younger population.

Historical Context
Honaker has historically served this sub-region as a retail and services center - an economic hub for the local economy stretching north into the coalfields. It was a transportation hub for coal and timber that were fundamental engines of the regional economy - providing plentiful jobs and fueling the local retail economy. The streets of Hoanker were crowded with shoppers on weekends and numerous dining establishments served as gathering places for people through out the region. This era came to a close during the 50's and 60's - driven by a series of macro changes in the basic economy and in transportation patterns.

What happened to the Honaker Economy of the Past?

• Changes in Coal Technology - fewer employees
• Decline of the timber industry
• Highway improvements make travel easier
• "Four lane" development of Rt. 19 bypasses Honaker
• Railroad industry changes business model
• Lebanon/Richlands grow into regional retail centers