Rural Arizona communities thrived after COVID, but now struggle to keep young people around

San Luis native Armando Esparza did what many young people in rural Arizona do: He left his hometown for the big city.  

Esparza moved from the agricultural community on the Arizona-Mexico border to study at Arizona State University and lived in Phoenix to build his career. Ten years later, he moved back to San Luis to work as the director of the city’s economic development department.  

“I was able to find a job opportunity where I can apply what I have learned in my years of economic development, and most importantly, I am able to grow,” he said about why he chose to move back. “This is not the case for a lot of people, but I was lucky.” 

Esparza’s experience a decade ago is still common. That’s illustrated in a recent report gathered by Local First Arizona, a rural economic development nonprofit. The organization in 2023 surveyed 440 young people up to 25 years old, with more than 70% of participants under 18 years old.  

In the report titled “Perspectives from Youth and Young Adults of Rural Arizona,” eight out of 10 respondents said they must leave their hometowns to find a quality career opportunity.  

Young people pointed to job quality and the lack of affordable housing as detractors in their small communities, the majority of which have populations well below 10,000 people. Rural city and town officials also stressed the lack of affordable housing, which they see as the primary obstacle forcing young people to leave.

But the consequences of that familiar story were upended when the COVID-19 pandemic struck. 

After initial COVID-19 fears, rural communities see pandemic boom

Small businesses across the country had trouble staying open. Municipalities worried about a potential decrease in sales taxes as people sheltered in place.  

But for many rural communities in Arizona, the pandemic provided an opportunity to draw in new people and bolster their offerings for current residents.

Some places made a concerted effort to promote tourism and brought in countless visitors who were looking to escape being cooped up during lockdown. The proliferation of remote work nationwide also gave many rural residents a choice to stay home and work instead of commuting — and possibly moving — elsewhere.

At the same time, city and town officials across the state were focusing much of their efforts on enticing young residents to stick around after high school and college, whether it be by increasing local job training or bringing in new industries altogether.

Bisbee, a former mining community of nearly 5,000 tucked into southeaster Arizona’s Mule Mountains, depends on tourism as its main economic driver. While the city was impacted by the pandemic, its economy fared better than expected as officials saw an increase in sales tax collections.  

“Tourism was the segment that we expected to suffer through the COVID years,” said Stephen Paukin, Bisbee city manager. “We actually didn’t suffer all that much.” 

North of Bisbee, the mining community of Globe also fared well during the pandemic. Officials primarily credit increased remote work as in-person jobs decreased as a result of social distancing measures. 

“We were anticipating about a 31% loss in sales tax revenue,” said Globe Mayor Al Gameros.  

But instead of fewer people coming to Globe, more arrived. 

“It didn’t hurt us, and that’s what’s bringing more people to the community: working remotely,” he said. 

At the state's other end lies Page, with a population of 7,400 people who live just a handful of miles south of the Arizona-Utah border. It’s renowned for its access to famous outdoor attractions like Lake Powell and Horseshoe Bend.  

Closure of the Navajo Generating Station in 2019 was a major employment and economic loss. But the city doubled down on its destination marketing during the pandemic to attract visitors.  

Page has seen 24 consecutive months of tax growth, City Manager Darren Coldwell said.    

“We have spent the money to chase the buck, and it's paid off,” he said.   

Data from the U.S. Census Bureau shows the population of small cities and towns across Arizona was largely unaffected by the pandemic. While each of the municipalities in this story suffered a dip in population at the outset of the pandemic in 2020, they each stabilized in 2021. In most cases, that stabilization led to growth in 2022, according to the Census Bureau's Population Estimates Program.

But leaders across northern Arizona also acknowledge they can’t rely on tourism forever, especially as the allure of Historic Route 66 fades from memory.   

“Eventually there's going to be a time where no one knows what ‘Standing on the Corner in Winslow, Arizona' is,” said Winslow city manager David Coolidge, and the city needs to prepare for that.   

City leaders are trying to highlight the unique opportunities presented by Winslow’s location in northeast Arizona – access to Interstate 40, the BNSF railway and a regional airport that could propel it into a future as a trade hub for the southwest. Construction on the I-40 trade port, a nearly 4,000-acre advanced logistics and manufacturing park, has recently begun in the city. 

Patagonia, a southern Arizona town of less than 900 people, also wants to leverage its natural resources into a post-pandemic boom.  The community is 63 miles south of Tucson, just north of Nogales, a city on the Arizona-Mexico border.

The town, known for its cycling opportunities and its ecological diversity, saw an increase in sales tax collections during the pandemic, with its hotel consistently full and the emphasis on buying local, according to Patagonia officials.  

Patagonia saw almost double the amount of sales tax collected in 2021 compared with 2017. The town’s 2023 audit showed sales tax collections reaching $1.2 million, compared with $263,412 in 2017.  

But officials acknowledge the boost won’t last forever. To help increase local high-skilled and high-paying jobs, Patagonia is turning to one of the area’s largest employers, mine company South32, to increase training opportunities.  

The Australian company owns the Hermosa Mine in the Patagonia Mountains and plans to partner with local secondary and post-secondary institutions and with tribal communities to train locals in Santa Cruz County to operate the mine. 

'Housing has to be here before there’s any industry'

A nationwide housing shortage is increasing rents and housing costs, and Arizona is feeling its impact. According to an analysis by Pew Charitable Trusts, rental prices across Arizona surged 53% between August 2017 and August 2023.  

According to Pew, studies show that rental prices increase when available homes are scarce, a phenomenon Arizona’s small communities know all too well.  

Housing is a central issue in Patagonia. With limited housing stock and out-of-state residents and corporations turning homes into bed-and-breakfast rentals, there are few homes that young people can afford, said Ron Robinson, Patagonia's town manager.   

Census data shows of the existing 700 housing units, 494 are owner-occupied, 262 are rentals, and 206 are vacant.  

“Younger people, 25- to 35-year-olds, they are folks that don’t have the funds to afford anything here,” Robinson said. “That’s a shame because our median age is 61.

"A lot of them are moving to Tucson. Some of them are getting jobs outside the state.” 

A two-bedroom apartment rental costs between $1,300 to $1,800 a month in Patagonia. That’s about 35% to 49% of the area’s median income, which averaged $43,512 from 2018 to 2022, according to Census data.  

Another challenge for small communities like Patagonia is attracting companies to build affordable housing.  

“I've talked to builders to try and build affordable housing, and they just go: ‘There's no money in it,’” Robinson said.  

Robinson said while the area does have many jobs in the community, the lack of high-paying jobs remains an issue. South32 in Patagonia is one of the primary higher-wage employers, he said.  

Patagonia Mayor Andrea Wood reiterated that jobs are not keeping people from living in Patagonia but rather a lack of housing. Residents can often find the mayor running her daughter’s restaurant.  

“It’s not that young people don't have the opportunity to work,” she said, noting that she has looked for employees to work at the restaurant. “It is that they don't have a place to stay. So they're not here to work.” 

Up north in Winslow, Coolidge fields weekly calls from executives across various industries interested in moving into the city, but with a lack of housing, he’s trying to ensure there is somewhere for workers to live when these new jobs come. 

“Housing has to be here before there’s any industry,” Coolidge said.   

Just over 14% of Winslow’s housing units are vacant, but only about 4.5% of the vacant housing units are available for sale or rent, according to Census data. Instead, most vacant units in the city are used seasonally or are otherwise not on the market.  

Winslow is looking to move toward a potential future as a bedroom community for Flagstaff, about 58 miles away. But to do so, the city needs to boost its housing stock as quickly as possible.   

And while city officials look into building more housing, Coolidge said it has only emphasized the city’s need to upgrade its infrastructure, especially the power generation capabilities.   

“As growth is starting to come upon us, we're starting to find out where, because we haven't achieved much growth over the last so many years, there is some infrastructure that is going to take some time to build out and we're trying to expedite it as best we can,” Coolidge said.   

“You can't just bring in several megawatts of power overnight.”  

'Give them a reason to come back'

Looking ahead, rural communities are exploring all options available to them to help reach their goals. 

Some, like Globe, are focusing on ways to attract investors and more development. Globe is trying to bring in more federal and state funding to improve its aging infrastructure in the hopes that people will want to build in the small city 85 miles east of Phoenix.

Globe is already increasing its housing stock. Earlier this year, it announced plans to add more housing, one development in a historic high school that will be converted to affordable senior housing, and another, Marigold Village that Gameros said will increase workforce housing. The project aims to add almost 700 market-rate apartments and housing units to Globe.  

Some 200 miles south, Bisbee has a similar focus on affordable housing options. The city is partnering with the nonprofit Step-up Bisbee/Naco, which refurbishes and rebuilds old homes and sells them for 20% less than their estimated value to medium and low-wage earners such as teachers, servers at restaurants, law enforcement officers and others.  

Bisbee is also using pandemic relief funds to improve infrastructure and maintain city-owned buildings, like the Hillcrest Apartments that the city wants to sell to developers for affordable housing. 

“We’ve improved the streets, we’ve improved the infrastructure,” Melissa Hartman, Bisbee's city planner, said about federal pandemic relief funds.  “We’re doing all these interesting projects and making the tourism rise and bringing more people here.” 

But 60 miles to the west, Patagonia is finding it challenging to attract investors to build affordable housing, despite its breathtaking natural landscapes and ample outdoor recreation opportunities.   

The town runs one affordable housing development for senior citizens.   

Robinson said Patagonia is focusing on acquiring land to build model duplexes to highlight what it can provide for people.  

“The builders aren’t going to do it ... so the town has to take the lead and do what we can to provide affordable housing in Patagonia,” said Robinson, Patagonia’s town manager. 

In northern Arizona, Winslow soon could see a boost in affordable housing as Habitat for Humanity of Northern Arizona’s new starter home program looks to expand beyond Flagstaff.  

Coolidge said the city is looking for “any way possible to incentivize building programs” for workforce and affordable housing.

As of now, Winslow is short about 800 homes, Coolidge said, but the demand is likely higher. Like other nearby communities, Winslow is strapped for money, with about a quarter of the population living under the poverty line.   

“We could build out 1,000 houses and still probably fill them all pretty easily,” he said.   

Officials are also focusing on workforce development within their own school systems, trying to incentivize graduates to stay in Winslow instead of moving to the Phoenix area. They’ve found new ways to survive in the post-pandemic world, officials say, but they still need an infusion of youth and fresh blood. 

“For many years folks have grown up here, gone to school here and left and then they don't come back, just because there's nothing to bring them back,” Coolidge said. 

“And so really that's our focus: Let's grow smart and let's create industry and jobs so that our talent that we grow in our school system here doesn't leave and then never come back. Give them a reason to come back.”   

The effort has been boosted in part by the proliferation of remote work and Winslow’s strong broadband capabilities compared with the rest of the region.   

“If you have quality broadband in your area, there are a tremendous amount of remote jobs available,” Coolidge said.  

In Page, more than anything, leaders want their experience over the past five years to serve as an example of ways rural communities can continue to grow even when things don’t appear ideal on the surface.   

“Look at the crises as opportunities, hear the public complaints as opportunities, and then take those opportunities and turn them into something fruitful,” Martinez said. “It can happen.”   

Reach the reporters at sarah.lapidus@gannett.com and LLatch@gannett.com.

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