Rural Econ 101

The Real Force Behind Rural Economics

There is a energetic, skilled, moderately wealthy and educated economic resource that is being completely overlooked by our community. This trend will continue well past 2050, here's why.

1: Thirty percent of all baby boomers will not or cannot retire, skilled knowledgeable people are looking for a way to create employment for themselves.

2: Roughly 78 million Americans were born between 1946 and 1964. Though most of those surveyed pointed to 70 as their retirement age, 27 percent said they would never retire.

3: As of 2000, the US census found that the most common household type are the twenty-seven million single person households, compared to 25 million households with a husband, wife, and children.

4: The National Realtors' group country-wide study shows, four out of 10 respondents said they intend to convert their vacation home into a primary residence in retirement.

5: The same study shows baby boomers are proportionately more active in the second-home market, owning 57 percent of all vacation/seasonal homes and 58 percent of rental property.

6: In 1900, the life expectancy from birth for the average American was 48 years. In 1990 it was expected and American would live to age 75. For 2010, it is expected to be a 78 year average life span.

7: In 2015, every payroll tax dollar that goes to Washington will turn right around and come back to local communities as Social Security or Medicare checks..... Every Federal Payroll tax dollar!

8: People over 55 years of age (30% of population) represent 50% of retail consumption annually.


The Number of rural people who have to work past their retirement age of 65 in Branch County, Mi. The number of working retirees within a 10 mile radius of Hodunk, Mi- 2014 people, 10 mile radius of Bronson, Mi-1,391 people, and a 10 mile radius of Kinderhook, Mi- 1,196 people,

This article was published Jan 28, 2008 and remains valid in today's economy.

Primary jobs are not main driver of economy

Linda Stanley, Ph.D.,

Primary jobs are the Holy Grail for most economic development agencies.

Economic developers typically define primary jobs as jobs that produce goods and services that are exported outside of the region. These exports then bring income back into the region that is spent locally, leading to "secondary" jobs. Thus, primary refers to the presumption that the export-income jobs come first in economic development and "secondary" (non-export-income) jobs follow.

Many in the economic development business will present these notions as truth. But there is plenty of evidence to suggest otherwise, leading many economists to recommend scrapping this model. Studies have shown that it often is local-oriented economic activity that drives the creation of export businesses, not vice-versa. In other words, an export-focused company locates in our community because our community's attributes (e.g., labor force, infrastructure, quality of life, related businesses) fit its needs.

Indeed, the size of a region's exports says nothing about a region's wealth. As a simple example, the U.S. has historically been a relatively low exporter; exports are about 11 percent of our GDP. Since NAFTA, Mexico's exports have increased to about 30 percent of their GDP. However, Mexico lags far behind its NAFTA partners in income, with 45 percent of its population in poverty, and income growth stagnant.

Why the difference? The United States has been rich in the real drivers of economic development, e.g., a democratic system, innovative capacity, entrepreneurship, excellent infrastructure, while Mexico has lagged in these areas. Although Mexico is rapidly catching up.

So what drives the economic development emphasis on export jobs? Economist Thomas Power maintains that because this strategy drives population growth, this emphasis works heavily in favor of powerful special interests - real estate and development, banking and others -who benefit from population growth. Instead of focusing attention on a questionable strategy, let's try an effective alternative that almost everyone would favor - finding opportunities for import substitution.

When a local company substitutes a local product for one they were buying out-of-state, the dollars that they were exporting out-of-state now circulate locally. In addition, the new local supplier may expand to meet increased demand. Jobs and income are increased; dependence on exports is decreased; and our local economy becomes more diversified, more connected and thus more stable.

The Local Living Economic Network working together could find opportunities to replace imported goods and services with locally produced goods. Other communities have recognized this potential and are implementing some of these ideas with great success.

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The greatest opportunities are not found by looking outward, but rather growing from within. Allow people to live & work in the same location whenever it is possible, by adapting flexible & sensible zoning. Embrace and celebrate mom & pop establishments, actively champion small markets and locally produced products.