My Article

 Back in 2017, I published “Quality-of-Life Based Retail Recruitment” in the IEDC’s Economic Development Journal (1). Among its main arguments were that:

• Many of the new retail shops in our smaller and medium-sized downtowns are being opened by new or returning residents (boomerangers).
• These new and returning residents are most strongly drawn by the town’s quality of life.  
• There are a lot of talented people who prefer the lifestyles offered in our small and rural communities, many of whom are now residing in other locations.
• Many will not need new jobs, or they can bring their current jobs with them, or they will create their own new jobs.
• They represent a substantial market segment that should be targeted by downtown EDOs in our smaller and medium sized communities. Such a program might be the most cost effective way to attract high quality independent retail operators to these downtowns.

New Data

Over the past year, I have had consulting assignments in a number of communities that are relatively rural and have populations under 35,000: Auburn, Cortland, and Oneida in Central NY, and Vinalhaven in ME. In the last few months, I also came across some research done in Minnesota, Nebraska and nationally that, I am embarrassed to admit, I should have found years ago, but that somehow eluded my earlier internet searches. These studies were done back between 2007 and 2015. They and my consulting assignments both provided new data and arguments that support the analysis I presented in my  QofL retail recruitment article and expanded my understanding of many of the points I had made.

Rural Areas Have People in Creative Class Occupations, But Fewer of Them.  a study published in 2007 of the creative class in the nation’s rural counties by David McGranahan and Timothy Wojan found that: “While in metropolitan counties about 30.9% of the workforce were in creative class occupations, in rural counties it was just 19.4%” (2).

People Being Drawn to Small and Rural Communities by Their QofL Assets Is Not a New Trend.  The Buffalo Commons survey of the Panhandle Region of Nebraska as well as research led by Ben Winchester in northwestern Minnesota found that these rural areas had “brain gains” as well as “brain drains,”  and that the incoming migrants were overwhelmingly attracted by a town’s QofL assets. For example, the Buffalo Commons survey found that migrants into the Panhandle’ counties were motivated by the desire for:

• A simpler life, 53%
• A less congested place to live, 50%
• Being closer to relatives, 50%
• Lower housing costs, 48%
• Lower cost of living, 45%
• A  higher paying job, 39%
• Living in a desirable natural environment, 37% (3)

Winchester’s study found that “There were a number of factors that were important in the newcomer decisions to move:

• To find a less congested place to live , 77%
• A better environment for raising children,  75%
• To find better quality local schools, 69%
• To find a safer place to live, 69%
• To lower the cost of housing, 66%
• To find a simpler pace of life, (66%
• To find more outdoor recreational activities, 63%
• To be closer to relatives, 62%
• To live in a desirable natural environment, 60%
• To lower the cost of living, 53% (4)

Additionally, the study by McGranahan and Wojan found that:

• ” The present analysis of recent rural development in rural US counties, which focuses on natural amenities as quality of life indicators, supports the creative class thesis”.
• In the rural counties of metropolitan areas, “ The creative class moves into less dense metropolitan counties in search of a higher (more rural) quality of life; the building of a creative class (then) creates an environment for job growth; and this leads to further in-migration” (5).

The In-Migrants Are Often Quite Skilled. Both the Minnesota and Nebraska studies found that these migrants “have significant education, skills, connections, (and) spending power” (6). The Buffalo Commons survey found, for example, 45% of them  had skills in the management, business, financial and professional fields.  Many of them would be considered members of the “creative class”.

However, findings of the McGranahan and Wojan study suggest that the skill sets of rural and metropolitan creatives might differ in important ways.  For example: more  metropolitan creatives had college degrees, 56.2% than the rural creatives, 36.8%. while  21.4% of the rural creatives were self-employed compared to 17.1% of the metropolitan creatives (7).

Rural Innovation. A topic one might hypothesize is strongly related to workforce skill sets is innovation. One useful definition of innovation is:  the introduction of “new goods, services, or ways of doing business that are valued by consumers” (8). A research report written in 2017 by Tim Wojan and Timothy Parker, of USDA’s Economic Research Service found that:

• Urban establishments in nonfarm tradable industries were more likely than rural establishments to be innovators.
• Innovation rates in urban and rural manufacturing industries are very similar.
• In the  service industries, the innovation rates of rural establishments are lower than those of the urban firms in the same service sector.
• The manufacturing industries with the highest rate of innovators in rural areas were pharmaceuticals, chemicals, computers, plastics and textile mills.
•  The only tradable service-providing industries with a high share of substantive innovators in rural areas were telecommunications and wholesale electronic markets.
• About 30% of metro establishments could be classified as substantive innovators, while only about 20% of the nonmetro establishments fell into this group. Importantly: “The metro-nonmetro differences in innovation are considerable but less than commonly assumed” (9).

Artists Havens. Another study published in 2007 by Wojan,  Lambert, and McGranahan, “The Emergence of Rural Artistic Havens: A First Look” focused squarely on the issue of the ability of rural counties to attract the artist subset of the creative class in 1990 and 2000. Counties meeting some minimum employment levels and with more than 40 people in artistic occupations were deemed to be artistic havens. Functionally, the existence of an artistic haven occurs when  “a minimum critical mass of artists or performers” has been established so that “members of the community benefit from substantial interaction among themselves and the group is large enough to affect culture of the wider community” (10).

The authors identified two kinds of artistic havens. “Existing havens” were those identified using 1990 census data, while the “emerging havens”  were identified with 2000 census data. Altogether, only about nine percent of our rural counties then had such havens.

However, what was noteworthy in their findings was that the number of havens had doubled over a decade. (See table above).

The table below is based on the pooled responses for the American Community Surveys for the years 2007-2011. It was constructed by USDA researchers.  Their results should be viewed as describing the situation during that time period. However, the ACS’s investigation of the number of “artists” is problematical because the average standard error on its estimates of the number of artists in each non-metropolitan county is about 45%. Nevertheless, the data may still be useful if we try to make some adjustments for that strong margin of error and treat the results as ‘directional” rather than definitive. To that end, instead of looking at the number of non-metro counties having more than 40 artists, I bumped the magic number up to 60. There are 668 non- metro counties that the ACS found having more than 60 artists, or about 35% of all non-metro counties. That suggests that there was probably a very substantial increase between 2000 and 2011 from the number of artistic havens, 199,  Wojan et al identified in their 2007 paper. Prudence suggests refraining from claiming an exact number, such as 489 (668-199=489), but very substantial growth seems very likely.     

Wojan et al explain that the strong relationship they found between the emergence of new artistic havens and the presence of large numbers of 25-44 year olds with college degrees is based on the highly educated workers being viewed as a very powerful proxy for quality of life” (11). They go on to state that: “The implications of these findings are that counties that have been unable to retain highly educated workers are less likely to attract artists in sufficient numbers to constitute an arts community”(12).  That all sounds very Floridian, but the unstated implication is that a lot of these highly educated workers is necessary. There are several problems with that. Richard Florida is quite adamant in his argument that it is the type of work people perform, not their  education levels, that is the defining factor of creative class members.

More importantly, there are small towns and cities like Auburn in NY where the percentages of college graduates, 20.7% , are quite lower than the nation’s, 30.9%, yet they are attracting between 50 and 100 artists who represent less than  0.5% of their town’s population. Nevertheless, they are able to build a sense of there being a recognizable artistic community, or “haven” in their communities.   

Also, McGranahan et al reported that about 63% of rural creatives lack college degrees. Does that mean they lack the magnetism  of other creatives? That seems highly unlikely.

If the highly educated workers are a strong proxy for QofL, then it would appear that more precisely investigating what the components of that QofL are is essential. The Buffalo Commons and the northwestern Minnesota studies give some strong indications about what some of them are. My own discussions over the years with creative types living in smaller towns and cities suggests that, while they certainly like having other creatives nearby, and appreciated the beauty of their area,  also very important are such factors as being closer to family, a slower pace of life, having a stronger sense of community, affordable housing costs, having active social places such as eateries, bars, public spaces and arts and cultural venues . In other words, they appreciated central social district type venues and the activities associated with them.

Getting back to the table, some of the data in it are presented in ranges determined by + and – 45% of the original estimates. For example, the mean number of artists per non-metro is between 41 and 107. When the error factor was 8% or less, just the estimates are reported in the table. This mostly occurred with the data on creative class occupations. As night be expected, these data show that the non-metro counties will have far fewer creatives and they will represent a lower proportion of those employed than in the metro counties. However, these levels are not negligible.   

While Young Adults May Be Leaving, 30-49 Year Olds May Be Returning. In both NE and MN, in-migration appears to have resulted in a surge in the populations of residents in the 30-49 years old age group in some rural locations (13). Of course, their populations in the young adult cohort show a consistent loss. This suggests that a significant amount of boomeranging may be occurring. The youths leave for better job prospects and a more urban life style, and many then return to small and rural towns  later in life with more skills and resources that strengthen their new communities.  For example, the Buffalo Commons survey found that 38% of the respondents and 32% of their spouses had lived in their current community prior to returning to it. Winchester found, though with a much smaller sample of 53, that 43% of the “new” residents has previously lived in or near their current community.

Boomerangs Are Important. One analyst has argued that boomerangers are not that important because they only account for 30% to 40% of the new migrants. To the contrary, it might more convincingly be argued that they are very important because no other prior residential location has anywhere near those numbers. Additionally, from the perspective of developing a business recruitment program that targets QofL prospects, there are several obvious possible networking opportunities with potential boomerangers that are completely absent with other prospects. Moreover, there have been several successful “Return Home” campaigns launched in communities such as Ann Arbor, MI, Scranton, PA,  and Superior, NE  from which much can be learned (14).

QofL In-Migrants Can Have Impacts Larger Than Their Numbers Might Indicate. My assignments in the Central NY communities was on a project led by the Lakota Group to assess the feasibility of establishing arts/creative districts in their downtowns. In each community,  well-attended focus groups were held for local artists, arts leaders and business people. In each town,  a strong majority of the creatives were either not natives of the town or boomerangs. When asked, most explained their reasons for moving to that town In terms of the QofL assets it offered.

Auburn. The situations in Auburn and Oneida are very revealing about the impacts these QofL migrants can have on the local business community. In Auburn, in recent years they have opened a number of shops that are very highly regarded by local leaders and shoppers. They are certainly viewed as much better operators than those who previously occupied their storefronts. Their current number is below 10, but  their presence suggests that the downtown is now in a much more upbeat place on its revitalization arc. It can be reasonably argued that their positive impacts on the downtown far exceed what their small number might suggest. Moreover, even If they keep coming at a rate of only one or two a year, in a few years there will be a substantial bolus of them with more than ample customer magnetism and image making power. They are successful because they are bringing in strong skill sets that are even relevant if they do a career reboot, as well as significant financial resources.

It is interesting that when interviewed, these QofL migrant entrepreneurs say that the presence of a significant arts community in the Auburn was an important factor in their decisions to live and work in their new communities. Since the Finger Lakes area is filled with numerous scenic places, outdoor recreational opportunities, vineyards, charming restaurants and inns, and historic sites, Auburn’s arts assets probably helped it compete successfully with other towns in the region to attract these new merchants.  

The leader of a local artists organization estimated that there are about 75 to 100 local residents who are artists of one form or another. That means that the city of Auburn, with a population around 26,000, today seems to be an artistic haven: it has besides its resident artists,  nine major arts and cultural attractions that have a combined annual attendance of about 199,000 that brings about $6,273,356 in spending power to the city that local merchants can capture (see table above).

Auburn is now on the path of creating an arts/cultural district to help provide a support structure for its arts community and to help it have stronger marketing and promotional capabilities. According the Americans for the Arts, there are now over 300 culture districts in the US (see the map below). They are proliferating, though only a small proportion our 19,000+ villages, towns and cities have them. The number in smaller and rural communities is unknown, but they are not scarce: e.g., Peekskill, NY; Paducah, KY; Ridgeway (900 residents), Salida and Crested Butte in CO. As a point of comparison, BIDs started to appear in serious numbers in the early 1980s and today there are over 1,000 of them across the nation. The culture/arts districts have not yet had 39 years to grow in.

Oneida. Downtown Oneida is now in the initial stages of its revitalization arc. Consequently, I was happily surprised to find in its struggling downtown a small group of independent merchants who are among the most marketing and internet savvy retailers I encountered in the overall project. While the old downtown retailers were dead or dying, these merchants were internet savvy and knew they had to tap consumers well beyond the town’s borders. One operates a vendor mart that brings a considerable variety of merchandise into town and provides some business incubation functions. Together, this group of operators formed a marketing campaign that targeted the visitors to a gambling casino located about an eight minute drive from the downtown. Two of these operators are boomerangs, and the spouse of one telecommutes on his job with a Fortune 500 corporation. Though the group is now small in number, it is modeling business behaviors for other merchants in the community, be they new or old,  while bringing a badly needed perspective into the town’s decision-making about economic policies and programs. They are, consequently, helping to change the business culture in Oneida  along several important dimensions as well as the way the downtown business community should be seen within the whole city. Moreover, I’ll bet their presence will attract more businesspeople who are like them.   

Vinalhaven. This beautiful island is located about a 75 minute ferry ride off the coast of Maine. It’s roughly the size of Manhattan. It has a year round population of about 1,400 that bulges to about 5,000 in the peak tourist summer months. Lobster fishing and tourism are it major economic engines. Home-owners who are part-time residents and relatively longer stay home rentals are the most important components of its tourism. These renters are often annual visitors. The thing that binds the year round residents, the part-time residents, the long-stay renters and the fisherman is the island’s highly venerated quality of life. They are quite overt in their awareness of this. The community is also united in its concern that any growth in tourism should be balances so as not to endanger their strongly appealing QofL.

The island’s downtown is relatively small, with relatively few storefronts, yet it is still the community’s economic and social hub. On a recent visit, I found that several of its merchants were QofL migrants with impressive previous careers elsewhere in the nation. They opened their shops on Vinalhaven to provide themselves with some income and/or to keep busy. This often meant career reboots. Some of the more recent arrivals wanted to live and work on Vinalhaven so much that, because the of very high costs of flood insurance, they had to pay cash for their new business locations. On Vinalhaven, if you subtract the QofL migrants who opened businesses there,  the downtown would be deader than a doornail!  

Vinalhaven is also an artists haven. A local gallery reported that about 70 artists are associated with it who spend at least some part of the year in Vinalhaven. These artists have displayed an attraction to Vinalhaven’s QofL. The gallery not only provides the artist with a marketing channel, but also serves as the artists main local social venue. Robert Indiana was a longtime resident. His estate may be opening some kind of museum in the downtown.

BOTTOM LINES

• The ability of small and medium sized communities in rural areas to attract talented new and returning residents because of their QofL assets is not a new phenomenon, but it has not been significantly strategically leveraged.
• Rural QofL assets have traditionally been mostly as natural amenities. However, more recently,  a high quality of life” is seen as being more broadly defined . That means that newcomers being able to  perceive the presence of an ample number of people like themselves, strong central social districts humming with some vibrant restaurants and watering holes, and strong public spaces are increasingly the assets smaller communities will need to pull in talented new residents  and boomerangs.
• “Brain Gain” and “Brain Drain” can happen in the same towns, with the young adults  leaving and mid-life adults, many of whom are boomerangers, moving in from larger, more urbanized communities.
• Simply stated, the underlying challenge for small and rural communities is to have the brain gain be larger than the brain loss.
• Some of these new and returning  residents will open downtown businesses. Though early on their absolute numbers may be small, say just two to five, their influence on the downtown’s revitalization can be exponentially greater. The ability to even recruit 1 or 2 of such QofL entrepreneurs annually could have very profound positive impacts on a downtown. Smaller and rural communities do not have win hordes of new residents to see meaningful positive changes.
• Potential boomerangers are an obvious market segment that a recruitment program should make a high priority target.
• However, anyone visiting the town, especially on a recurring basis, should also be targeted – e.g., visitors to local hotels/motels, restaurants, parks, museums, theaters, etc.
• Smaller communities are, well, small, so you do not need to attract hordes of creative class members — or their artist subset — to spark significant economic development.

ENDNOTES

1) See: https://www.iedconline.org/clientuploads/directory/docs/EDJ_17_Summer_Milder.pdf

2) David A. McGranahan and Timothy R. Wojan, “Recasting the Creative Class to Examine Growth Processes in Rural and Urban Counties”. https://naldc.nal.usda.gov/download/41989/PDF

3) See: https://unlcms.unl.edu/center-for-applied-rural-innovation/community-marketing/buffalo-commons-survey

4) See: Ben Winchester: https://extension.umn.edu/economic-development/rural-brain-gain-migration

5) See endnote 2

6) See endnote 3

7) See endnote 2

8) Tim Wojan and Timothy Parker. “Innovation in the Rural Nonfarm Economy: Its Effect on Job and Earnings Growth, 2010-2014.” USDA Economic Research Service. Economic Research Report Number 238, September 2017. https://www.ers.usda.gov/webdocs/publications/85191/err-238.pdf?v=0

9) Ibid.

10) Timothy R. Wojan, Dayton M. Lambert, and David A. McGranahan, “The Emergence of Rural Artistic Havens: A First Look.” Agricultural and Resource Economics Review, April 2007. https://pdfs.semanticscholar.org/fe36/86db666b2f5e0890e1898a80c844132aba1a.pdf

11) Ibid.

12) Ibid

13) See: Randy Cantrell, “Nebraska’s Rural Population: Growth and Decline by Age”. Rural Futures Institute at the University of Nebraska https://www.unomaha.edu/college-of-public-affairs-and-community-service/center-for-public-affairs-research/documents/policy-briefs/pb2015-nebraskas-rural-population.pdf and https://extension.umn.edu/economic-development/rural-brain-gain-migration

14) See for example: Dana Crater, “The talent competition, part 2: “Return Home” campaigns”. Posted to IEDC website on   July 24, 2014.