Locally Owned Businesses Contribute to Well-being of Their Communities
A new study in the U.S. has found that communities with a greater concentration of small, locally-owned businesses have healthier populations and a greater sense of well being among their residents than do those that rely on large companies with “absentee” owners. The study, which was conducted by sociologists at LSU and Baylor University, and published in the Cambridge Journal of Regions, Economy and Society, looked at 3060 counties in the U.S. and analyzed national population, health, business and housing data.
Unlike chain retail “big box” stores and large manufacturing plants, small local businesses have a greater investment in the community and thus have more at stake when it comes to the well-being of employees, customers and other local citizens. “Some communities appear to have thriving small business sectors that feature entrepreneurial cultures that promote public health. A place like this has a can-do climate, a practical problem-solving approach in which a community takes control of its own destiny,” said study co-author Charles M. Tolbert, Ph.D., chair of the sociology department at Baylor. “The alternative is the attitude that ‘Things are out of our control.’” Communities may become dependent on outside investment to solve problems, the researchers wrote.
The study’s findings are a departure from the traditional conclusion that “bigger is better.” Beginning in the 1970s, communities courted large employers from the outside, with a goal of providing high-paying jobs with benefits. In contrast, small local employers offered lower pay, few - if any - benefits, little chance for advancement, vulnerability to competition and sometimes, nepotism. However, many of these larger employers have moved overseas to cheaper labor markets. Those that have stayed are paying lower wages and may not even offer full-time jobs with benefits.
Larger companies showed a large drop in wages - 33 percent in real dollars. And amid restructuring and globalization, some large businesses are giving employees furloughs from full-time jobs, then rehiring them as short-time contract workers with no benefits. While locally owned businesses are not adding greater compensation or benefits, the pay gap is shrinking. “It’s in their financial interest to take a stake in the community, to make it a place where people want to live and work,” Tolbert said.
For more on this study please see the press release at Science Daily web site
Check out CUPE’s shop local campaign, explained in a short video at Ten Percent Shift
