American Independent Business Alliance

Locally-Owned Businesses Help Prevent “Brain Drain”

Locally-Owned Businesses Help Prevent “Brain Drain”

Does a robust number of local independent businesses in a community help retard “brain drain?” A study published in Sociological Spectrum, College Graduates, Local Retailers, and Community Belonging in the United States (2014), indicates it does.  The researchers explored the role of civic climate in resident population stability and the link to the number of local independent retailers at the state and county level.

The study’s overview notes “locally-oriented retailers are a valuable resource for promoting residential stability.” Especially noteworthy, the authors said “In particular, highly educated residents might be more prone to stay in communities where local retailers play a more prominent role in local life.”

This connects to earlier studies demonstrating the greater civic engagement in communities where small farms predominated compared to communities with large corporate farms. Additional studies point to the tendency of independent retailers to have greater attachment to and involvement in the community through a variety of channels beyond making money.

The “Community Belonging” study’s conclusion offers an insight consistent with our observations and recommendations for community economic development:  “It takes a state-level perspective to see that, though locales that encourage or allow absentee-owned retail may experience competitive advantage in the short run, they will not hold their own in the long run—in this instance, their own highly skilled workers.”

The study was published in Sociological Spectrum: Mid-South Sociological Association. Volume 34, Issue 2, 2014, pp 143-162.  Co-authors are Samuel StroopeAaron B. FranzenCharles M. Tolbert and F. Carson Mencken.

 

See the Top Reasons to Go Local for powerful talking points and more studies demonstrating the importance of local business ownership.

Get AMIBA’s free guide to developing effective “buy local” campaigns (available in English and Spanish).

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