The economic health of many rural towns and regions depends on their ability to maintain a competitive manufacturing sector. In a recent ERS survey, rural manufacturers reported that, more than any other factor, the quality of local labor hindered their competitiveness. Other frequently cited local problems included State and local taxes, environmental regulations, the attractiveness of the area to managers and professionals, and the quality of local schools. The extent of these problems varies by region more than along a rural-urban dimension. Labor quality problems were more likely to be reported by manufacturers who paid below average wages, hired less-educated workers, and used advanced technologies. Advanced technology users in counties that specialized in manufacturing or had 2-year colleges were less likely to report labor quality problems.