Kent County Leads Nation in Social Security Payments

If Kent County residents did not receive their monthly payments from the Social Security Administration, 8.6-percent of total personal income in the county would be lost, a total of $79,355,430 in 2009. Kent County is more dependent on Social Security payments than is the rest of the country. Nationally, 5.5-percent of total personal income came from Social Security payments, and in Maryland, 4.0-percent of all income came from these payments. In Kent County, 5,685 people receive some form of Social Security payment, either an old age pension, a survivor benefit or a disability check. Social Security beneficiaries represent 28.1-percent of the total county population.

In rural counties such as Kent and counties with smaller cities, Social Security payments constitute a much larger chunk of the local economy than in urban areas. A greater percentage of people in rural America receive these payments than in urban counties. Total Social Security payments in Kent County amounted to $3,919 per person in 2009. The national average was $2,199 per person, and in Maryland it was $1,960.

Social Security payments in Kent County have been changing as a proportion of total income. These payments amounted to 5.7-percent of total income in 1970, 9.0-percent in 1980, 7.7-percent in 1990, 8.2-percent in 2000 and 8.6-percent in 2009. Social Security payments are particularly important to rural counties and small cities because the money is largely spent in the community. If this money dried up, many of these small towns would disappear.

Social Security payments amount to 5-percent of total income in urban counties. In counties with small cities, these payments amount to 8.2-percent, and in rural counties such as Kent County, Social Security totals 9.3-percent of all personal income. More than one out of five Americans living in small cities and rural counties received some kind of Social Security check in 2009.

Judith Stallmann, an economist at the University of Missouri, explained that Social Security payments help generate the sales that keep a rural business afloat. “We find that Social Security income can be the difference between success and failure for some local businesses,” Stallmann said. “If you took away, say, 10-percent of the demand, would that local business be able to remain open? Often it’s that 10-percent that keeps them going. Social Security is providing that margin.”

Social Security payments go to those over the age of 62 who have filed for benefits, to survivors of insured workers and to those with disabilities. The program is mainly funded by payroll taxes. In Kent County, 78.5-percent of recipients were retirees in 2009, 10.1-percent were survivors and 11.4-percent were disabled. Changes to Social Security are being discussed in Congress, which is looking for ways to balance the larger federal budget. If benefits are cut or if the eligibility age is increased, rural counties and small cities would be disproportionately affected, according to Peter Nelson. “Cuts would have a bigger negative impact on rural places, absolutely,” Middlebury’s Professor Nelson said. “They are more dependent on Social Security.”