Those who have been following rural development trends and policies over the past several years have certainly heard a lot about the necessity of promoting entrepreneurship in rural areas. As policymakers and rural development practitioners work to establish methods to sustain rural economies, encouraging entrepreneurship has come to the top of the list, which has been articulated by numerous top scholars in the field of rural development.
Despite its continued difficulties, the rural economy is evolving. Rural areas are becoming more diversified and creative. Let’s look at a few benefits and drawbacks of operating a business in rural US.
Entrepreneurship Opportunities in Rural Areas
Building prosperous, scalable enterprises in rural America is now simpler thanks to the development of digital technologies and the recent influx of people there because of the COVID-19 outbreak.
Here are a few explanations:
Risk-free environment :
Matt Dunne, the founder of The Center for Rural Innovation, discusses why firms should invest in rural communities during a gathering at the Magnuson Center for Entrepreneurship at Dartmouth. Entrepreneurs constantly search for risk-free work environments in which to conduct their operations. A reduced cost of living and doing business might be found in rural areas. Less expensive means less risk for business owners.
There might be fewer rivals for rural enterprises that concentrate on their local market, making it less hazardous for business owners.
Community-based organizations’ support:
Since rural entrepreneurs frequently have fewer resources than their urban counterparts, support from community-based groups is essential. The Center for Rural Affairs and the Rural Business-Cooperative Service, among other organizations worldwide, are currently concentrating on assisting rural entrepreneurs.
In Investing in Rural Prosperity, Noel Andrés Poyo claims that community-based organizations “can bridge gaps in local government staffing and resource capacity.” To find these community-based organizations and learn what kind of assistance they might provide, rural entrepreneurs can use the Internet or their local government office.
Learning-oriented workforce:
In contrast to the fact that 12.5 percent of the present American population lives in rural regions, just 5 percent of IT employees are employed in these places, according to a survey done by Dunne’s organization, The Center for Rural Innovation. Nevertheless, “rural residents express a high level of interest in tech jobs.” The report urges increased training by:
- Enhancing the visibility of the local tech community.
- Establishing cohort-based, collaborative learning methods.
- To increase the talent pipeline, make training more available to individuals who are currently employed or those who are reentering the workforce.
- Investing in primary and secondary education programs that introduce young people to working with technology.
Thankfully, a lot of rural areas have taken up the issue. For instance, in Cape Girardeau, Missouri, Codefi’s Youth Coding League collaborates with schools and organizations to teach computer science and introductory computer coding to students in the 5th through the 8th grades.
There are still difficulties, though.
Entrepreneurship Obstacles in Rural Areas
Rural entrepreneurs still have challenges to overcome despite their enormous potential. The most current Megaphone of Main Street report from SCORE provides a great summary of the issues, noting that 54.6 percent of rural small business owners say finding clients is the biggest concern keeping them “up at night.” In addition to the report’s discussion of the following challenges affecting rural enterprises, cash flow is a problem.
- 35.9 percent of communities lacked sufficient numbers of skilled workers
- 45.3 percent: Americans leaving rural areas
- 19.2 percent of people do not have access to broadband or high-speed internet
Let’s examine these difficulties:
Access to broadband:
Due to its ability to support stable supply chains, attract and retain top people, and market products and services, broadband access is crucial for small businesses. 19.2% of rural entrepreneurs identify a lack of high-speed Internet connectivity as a key barrier to success.
72% of adults in rural areas have broadband, according to a 2021 Pew Research study. Thankfully, increased Internet accessibility is anticipated to increase, much like skilled local labor.
The availability of capital:
Rural American business owners lack access to the capital that urban businesses do since there are fewer banks there. There are still choices, though. Grants are also available for rural business owners.
A smaller pool of labor:
Typically, young adults and college grads who want to leave their small-town towns for well-paying positions that match their skill set struggle to locate qualified, experienced, and well-educated work opportunities. It’s still difficult to find qualified people locally.
However, a report from the annual Investing in Rural America Conference of the Federal Reserve Bank of Richmond claims that “the ground has shifted.” Small communities are improving their ability to recruit and retain talented individuals as well as advertise themselves. This is fantastic news for rural enterprises since it may make it easier to get beyond this barrier in the future.
Additionally, some jobs can be performed remotely even if a rural business is based locally, like a farm or a hair salon. These are some good examples: sales, marketing, customer service, accounting, and human resources. The ability to hire talent not currently present locally allows business owners to fill remote positions.
Making Investments in Rural America
For the prosperity of the country’s economy, rural entrepreneurship needs to be supported. Communities can generate jobs, strengthen local economies, and draw even more companies by assisting entrepreneurs.
