Williamson is the site of a large rail yard built by the former Norfolk and Western Railroad (now Norfolk Southern Railway), which was built to service the many coal mines of the region. The city is protected by a floodwall, completed by the U.S. Army Corps of Engineers in 1991 in response to a devastating flood along the Tug Fork River in 1977. The wall incorporates floodgates along major access points which, when locked, form a solid barrier against floodwaters. There have only been two uses of the gates thus far: the first occurring in 2002 during a major flood in the region, and the second occurring in 2003, when only two lower lying gates were closed in anticipation of rising water levels.
The local economy is largely fueled by coal mining, transportation, health care and retail.
As of the census of 2000, there were 3,414 people, 1,566 households, and 903 families residing in the city. The population density was 1,022.6 people per square mile (394.7/km²). There were 1,892 housing units at an average density of 566.7/sq mi (218.7/km²). The racial makeup of the city was 83.51% White, 13.65% African American, 0.38% Native American, 1.00% Asian, 0.29% from other races, and 1.17% from two or more races. Hispanic or Latino of any race were 0.91% of the population.
There were 1,566 households out of which 24.1% had children under the age of 18 living with them, 39.0% were married couples living together, 15.3% had a female householder with no husband present, and 42.3% were non-families. 40.3% of all households were made up of individuals and 18.0% had someone living alone who was 65 years of age or older. The average household size was 2.11 and the average family size was 2.85.
In the city the population was spread out with 20.0% under the age of 18, 8.2% from 18 to 24, 24.0% from 25 to 44, 26.2% from 45 to 64, and 21.4% who were 65 years of age or older. The median age was 44 years. For every 100 females there were 82.6 males. For every 100 females age 18 and over, there were 75.8 males.
The median income for a household in the city was $19,635, and the median income for a family was $35,893. Males had a median income of $36,250 versus $20,291 for females. The per capita income for the city was $15,303. About 22.1% of families and 28.8% of the population were below the poverty line, including 39.5% of those under age 18 and 18.2% of those age 65 or over.