How Specialized is “too” Specialized? Outmigration and Industry Diversification in Nonmetropolitan Counties across America

Outmigration and industrial composition have separately been the focal points of a significant amount of research related to nonmetropolitan counties; however, few (if any) studies have explicitly looked at the relationship between the two topics. The primary objective of this research is to identify what industry specialization level is “too” specialized with regards to outmigration – that is, to determine the level where specialization begins to have a damaging effect on population change. County-level data from a variety of sources is used to explore the impact of both earnings-based and employment-based definitions of specialization on net migration in nonmetropolitan counties from 2000 – 2009. Two distinct techniques (ordinary least squares and average treatment effects) are then used to assess both the impact and causality of being “too specialized.” The results suggest that a variety of specialization thresholds exist across various industries, including some surprising positive influences of industry composition on migration rates.