As of the census of 2000, there were 7,976 people, 3,379 households, and 2,331 families residing in the county. The 2005 Census Estimate placed the population at 7,992 The population density was 34 people per square mile (13/km²). There were 3,959 housing units at an average density of 17 per square mile (6/km²). The racial makeup of the county was 96.75% White, 1.44% Black or African American, 0.33% Native American, 0.14% Asian, 0.11% Pacific Islander, 0.24% from other races, and 0.99% from two or more races. 1.35% of the population were Hispanic or Latino of any race.
There were 3,379 households out of which 27.70% had children under the age of 18 living with them, 54.70% were married couples living together, 9.70% had a female householder with no husband present, and 31.00% were non-families. 27.60% of all households were made up of individuals and 12.00% had someone living alone who was 65 years of age or older. The average household size was 2.33 and the average family size was 2.80.
In the county, the population was spread out with 21.50% under the age of 18, 7.90% from 18 to 24, 27.40% from 25 to 44, 27.60% from 45 to 64, and 15.70% who were 65 years of age or older. The median age was 40 years. For every 100 females there were 94.60 males. For every 100 females age 18 and over, there were 95.00 males.
The median income for a household in the county was $23,958, and the median income for a family was $29,784. Males had a median income of $23,513 versus $16,219 for females. The per capita income for the county was $13,320. About 14.30% of families and 19.10% of the population were below the poverty line, including 23.40% of those under age 18 and 27.60% of those age 65 or over.
Its name is in honor of Henry Clay, famous American statesman, member of the United States Senate from Kentucky and United States Secretary of State in the 19th century. Clay County is the home of Cordell Hull's first law office, which is now part of the county museum.
Some of the earliest inhabitants are believed to be the Mississippian Indians, forerunners of the Cherokee. Other Indian Tribes who once dwelt in the Clay County area were the Shawnee, Cherokee, Chickasaw, and Iroquois. Many tribal fights took place near the Cumberland and Obey Rivers and many arrowheads can still be found in the bottomlands around the waterways.
The earliest white man that came to the area to hunt was a Frenchman, Martin Chartier, who is believed to have been here as early 1691 with the Shawnee. One of the first permanent settlers in Clay County was Obediah Terrill, who arrived about 1770. The Obey River is named for him.
Clay county's early inhabitants farmed and worked the Cumberland River transportation center, which was the major way to get around the Cumberland area. There were many docks and ferry crossings throughout Clay county to get local crops and livestock to major markets. The timber industry was a large player throughout the 1800s and 1900s and still provides many jobs today.
Butler's Landing was used as a storage depot with large warehouses owned and operated by the Butler family. The first Clay County Court meeting was held in a store near the river at Butler's Landing on March 6, 1871. Butler's Landing nearly became the county seat, but Celina won the vote by a thin margin.
The city of Celina is at the junction of the Obey and Cumberland rivers, and was a major port during the steamboat years between Nashville and Burnside, Kentucky. Although the Celina ferry landing no longer exists, Celina still connects the north and south by highway.
During the Civil War, many skirmishes took place up and down the Cumberland River to control the movement of barges laden with supplies. Local communities were split in their loyalties, with many families at odds with each other. Some of these animosities remain today between family groups.
Tobacco farming became an important crop in the local area throughout the 1900s and many old tobacco barns are still standing. With the end of government subsidies and foreign competition, tobacco farming has decreased to minuscule participation. Cattle and corn are the major agricultural influences today.
Clay County's rural location and lack of major four-lane highway connections continues to hamper development and recruitment of businesses. This has resulted in the county having the highest unemployment rating in the State of Tennessee many months of the year and the loss of educated young people who have no opportunities locally.