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Bringing Back the Burg: How Local Government Can Help Local Business

It's an all too familiar story in modern day America. A once vibrant town now struggles because its main source of economic security decided to move somewhere else. The unemployed workers, who are vested in their community, have difficulty finding new jobs that meet the needs of their families. And facilities that were once filled with activity now stand vacant, waiting for someone to make use of them again.


Image Credit: Wikimedia Commons


Oftentimes, when a city is put in this predicament, the first impulse is to catch another big fish to replace the one that got away. While this strategy may be part of the solution, it does not fix the problem that created the situation in the first place: too much dependence on a single employer or industry. Think of the many towns that fall into this category: Detroit, Pittsburg, Dayton, St. Louis, and many other less well-known places.


Because large companies are often focused on profit and not on economic mutuality, it is important for local governments to understand what will benefit their citizens the most, especially in the long run. A large corporation can bring many positives to a community, but it can also cause great hardship when it leaves or downsizes. In order to sidestep this kind of economic sinkhole, cities need to be more creative, smarter, and more forward thinking than they have been in the past.


One of the best ways to diversify an economy is to encourage and support an array of small businesses. A number of cities have taken this kind of initiative, one of which is Spartanburg, SC. The former textile stronghold has grappled with how to revitalize itself since that industry declined 30 years ago. In the last number of years, some innovative leaders have developed strategies (such as the "Bringing Back the Burg" campaign) that boost local business and encourage new entrepreneurs, including:

  • Creating a small business fund that makes low interest loans, which can be used for rent, payroll, and other business expenses;

  • Increasing micro-retail space and expanding co-working spaces downtown;

  • Coordinating existing support organizations and listing them on a single website;

  • Providing customized services and support for start-ups;

  • Connecting owners with mentors, subject matter experts, and technical assistance.

The city and private investors have also invented new uses for its abandoned mills and have been successful in transforming several of them into commercial spaces, such as a multi-studio art center and administrative offices that provide additional opportunities for small businesses.


There are many other ways in which a municipality can support current business and encourage new growth. One of the most critical needs is access to capital. Especially in challenging economic times, a small business may easily be passed over by banks and other lending institutions. Cities and counties that assist these businesses during the critical early phase greatly boost their chances of meeting initial expenses successfully, so that they can reach the profitable phase of their endeavor.


A number of other areas exist where local government can help, including:

  • Creating an online or in-person networking hub for local business people to come together and share information and ideas;

  • Utilizing an existing government website to create a page for free advertising space;

  • Promoting a "buy local" campaign on an ongoing basis, including live events;

  • Developing training, apprenticeship, and internship programs in conjunction with a local college or university. One of the most difficult tasks for small business owners is finding qualified help and/or training new workers.

  • Making regulations and requirements for business easy to access and understand, with seminars and training sessions available on a regular basis.

  • Assisting businesses with transitioning to an online market. One inventive city developed a system where people who shopped local online could earn points to spend in local stores.

One of the most creative ways to encourage entrepreneurship is that of an idea event, such as the Be the Change10k! pitch competition in Akron, OH. Teams of university students generate ideas for new businesses and are supported by community and faculty mentors. The $10,000 award has only one requirement: that the idea be used to benefit the Akron community. This format could be applied to towns and cities as well, where it could not only help to develop new business but could also be used as an event to draw attention to local commerce.


Whatever the strategy, supporting local business is one of the most satisfying forms of economic mutuality. Small business owners are our neighbors, after all. When local businesses flourish, so does the town where they are located, and not just because the tax base is expanded. Other benefits include a higher standard of living overall, perks such as public recreational venues, and pride in community, all of which draws newcomers. We at Better Capitalism encourage you to not only support these businesses individually, but to encourage your local government to do so as well.



What about you? Share your story, question, comment, idea, disagreement -- yes, we welcome disagreement for the sake of mutual benefit! -- with us at blog@PartnershipEconomics.com. We will give a thoughtful response.


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