The competition for new industries, businesses, offices and the jobs they bring to any area is quite intense. Every community, county and region hopes it can land new factories, distribution facilities and stores. Throughout the nation and all across Illinois, economic development is a key concern for business and governmental leaders.
That’s why larger metropolitan areas — cities like Rockford and Peoria, as well as regions including Chicagoland and the Metro East area across the Mississippi River from St. Louis — have economic development offices with programs and teams of people all with the expressed goal of attracting new business to their areas. But what about the rest of us? What does economic development look like for the rural areas of Illinois?
“Rural development is tougher for us, that’s for certain,” says Courtney Yockey, executive director of the Richland County Development Corporation. “In rural areas like ours, there is a smaller population, you may or may not have interstates, and the highways you do have go through smaller communities.”
Yockey adds that infrastructure can also be a limiting factor.
“It’s also tougher to accommodate the needs of very large businesses for water and sewer services, for example,” he says.
Bob Dickey, manager of marketing and economic development for Paxton-based Eastern Illini Electric Cooperative says other factors such as smaller labor forces, thanks to lower unemployment rates, make attracting new businesses more difficult.
“In many cases, the unemployment rates in rural areas are already low, so there are not that many people available to work in a new business,” Dickey explains. “Another issue is if there are people who need work, they may not have the skill sets that are necessary.”
“By definition, we are rural,” Du Quoin Mayor Rex Duncan points out. “We don’t have a critical mass of population or tax base that is sometimes necessary to attract major businesses.”
For that reason, garnering the attention of businesses looking for new homes is important, according to Marcel Wagner of the Great River Economic Development Foundation which serves Quincy and Adams County.
“Branding is important,” Wagner says. “We don’t have the budgets the bigger cities have, and we are not able to do some of the marketing and outreach they do. That means we probably don’t have the same name recognition as the larger communities. Our job is to try to convince people there are such strong reasons to be here, that they overcome some of the disadvantages we may have. We have to find our competitive advantages.”
That means changing how rural areas feel about themselves, Dickey points out.
“We have a tendency to talk about things other than our strengths — things like having the freedom and flexibility to expand without some of the regulatory requirements and taxation burdens of the larger metropolitan areas. We have to focus on the positives because if we don’t , why would they want to come here?”
There are many positives rural areas have when it comes to economic development, Gary Williams, economic development coordinator for the City of Carbondale, says.
“For a manufacturer, the highest cost of production often is transportation. In an area with less traffic and congestion, that’s a plus,” Williams says. “Also, rural areas often have a higher quality of life, more affordable housing and people with a great work ethic. That’s attractive to new business.”
Angling for small fish, not whales
Dickey says the traditional wisdom and approach of trying to land a “big fish” like a large factory or distribution facility that will make a sizeable splash with lots of new jobs — may not be accurate.
“We’ve been chasing after the pot of gold at the end of the rainbow, when the rainbow isn’t actually there,” Dickey explains. “With many economic development activities, everybody is going after the new business and the competition is keen. As a result, it is like a feeding frenzy, but nobody’s getting to eat. There’s just not enough new business to go around.”
Instead, leaders say there also needs to be a shift in target when it comes to economic development in rural areas.
“There are fewer and fewer new business location projects every year and the competition is very stiff,” Shawn Rennecker, economic development director for Illinois Rural Electric Cooperative in Winchester explains. “It’s not all about business attraction. Retention is the most important thing. We have to work with the existing businesses to help them grow and stay vibrant in our communities.”
Dickey says he believes the majority of future economic growth will come from expanding businesses which are already in our communities.
“We need to be building our existing businesses and see how we can help them expand,” Dickey adds. “We have to facilitate their growth because that’s where the majority of economic development is going to come from.”
“These home-grown companies are very important for a lot of reasons,” Wagner says. “These firms tend not to be subject to things like corporate decisions to move. When the decision making is done somewhere else, it can be a challenge for rural areas.”
Yockey is a believer in business retention and expansion as a catalyst for slow, steady growth.
“These are our biggest assets to help build from within the community,” he says. “Sure, we’re always looking to bring industry into the area, but we definitely want to assist the businesses that are already here, too. Three or four companies with 12 or 16 jobs are just as important as a business with 50 employees.”
Growing our own
There is a growing movement of entrepreneurship in small communities across the state, and many areas are working to promote starting a business as a viable endeavor for residents of all ages. Many areas are developing programs for high school students to teach entrepreneurship and assist young people in starting their own businesses.These school-based offerings, often called CEO programs for “Creating Entrepreneurial Opportunities,” combine the efforts of educators, business leaders and government officials in a unique economic development partnership. (For more on CEO programs, see page 13.)
Working together Efforts to promote entrepreneurship are not the only cooperative efforts necessary for economic development in rural parts of Illinois.
“The key for all of us in rural areas is to work together, because none of us has all of the resources we need to make everything really attractive. Together we can offer lots of amenities and programs,” Carbondale’s Williams explains. “It takes a multi-city, countywide and even multi-county approach.”
For Du Quoin Mayor Duncan, a collaborative effort means setting aside long-held rivalries.
“We have to find ways to constructively work together and not compete,” he says. “A win for my town is not a loss for the neighboring town. Economic development is not football or basketball. This is not a ‘we win, you lose’ rivalry. It’s a win-win.”
Economic development also requires help from organizations outside of local government.
“In many small communities, there is no arm of the city that does economic development-related activities,” explains Bruce Wallace, executive director of the Murphysboro Chamber of Commerce. “Therefore, it falls to chambers to stimulate some of these things and to market our communities.”
Holly Healy, executive director of the Carmi Chamber of Commerce says the role of business associations is multi-faceted.
“I believe one role any chamber should play in economic development is to help with the expansion and retention of local business we already have in our communities. We should help promote the goods and services available both in and out of the community for which we work, keeping our current business viable, while making our community attractive to businesses that are considering calling our community home,” Healy says.
Rural electric cooperatives also have a vested interest in economic development, Dickey says.
“I think we have a duty to help our regions. We’re trying to grow our areas and communities,” he says. “We have to help our members become more efficient in what they do so they can grow.”
That role is one of the missions of cooperatives.
“Our co-op has been working to improve the quality of life for our members since creation,” Rennecker adds. “If a new employer comes into our area, it helps to bring in more people. There’s a benefit there. The cooperative model is helping the community. It’s that simple.”
Other organizations including state agencies such as the Illinois Department of Commerce and Economic Opportunity, the Illinois Environmental Protection Agency, regional economic development offices, small business development centers and the United States Department of Agriculture all have programs specifically designed to help rural areas grow.
“Many of our programs can assist with projects in a community,” explains Molly Hammond, assistant to the Illinois state director for the USDA Rural Development. “That includes things like water systems, hospitals, fire stations and housing – plus we have programs especially for businesses.”
Some USDA rural programs involve partnerships. Rural Economic Development Loans and Grants (called Red Legs) consist of no-interest loans or grants to electrical or telephone cooperatives, which in turn lend the money for community projects or growing businesses.
“Much of what we do is to try to keep rural areas attractive for business, as well as for the young people who grow up there,” Hammond adds.
The big picture
Economic development activities take a lot of work and time, Duncan says, but eventually results will come.
“It takes outreach, it means involving the right people and it takes collaboration and trust,” he explains. “When you start seeing more and more communities do this and work together, you will start to see things happen.”
“Economic development is challenging for rural areas,” Williams says, “but it’s not impossible.”
One of the biggest pushes in rural economic development is finding ways to encourage young people to remain in rural areas after they finish high school or college. Helping students develop their own small businesses is one way to do that, and all across Illinois, high school CEO programs are turning juniors and seniors into entrepreneurs.
Currently there are nine “Creating Economic Opportunities” programs in Illinois high schools with 15 or more new programs set to begin this fall. These efforts, coordinated by the Effingham-based Midland Institute for Entrepreneurship, combine classroom experience, real-world mentorship and entrepreneurship education to help students become entrepreneurial thinkers who can change local economies.
“Young entrepreneurs are identified in our school systems like athletes and scholars are,” explains Craig Lindvahl, executive director of the Midland Institute. “We’re trying to encourage and educate entrepreneurs. When we identify and connect with those kids to begin creating in their minds that their hometowns are the best places for the best opportunities, that is game changing.”
In CEO programs, students participate in a high school entrepreneurship class where they get academic credit, meet with business people (often in their businesses) and learn how to develop and run their own enterprise.
“Our community believes that this is what we have to do to foster small business development,” explains Bill Fritcher, superintendent of Teutopolis Unit 50 schools, which has been offering the CEO program for five years. “We have to find a way to train and retain our talent; that’s what this program does.”
While some students look at the CEO program as a learning opportunity, others actually start their own businesses and continue to grow those businesses after graduation — everything from clothing retailers to photography businesses.
“It’s a long-term look at economic development, but that’s the way we have to do it,” Lindvahl says. “The only way to fix dying communities is to change the way young people feel about their communities.”
Lindvahl says the program also fits students’ perception of the working world.
“Kids see entrepreneurship as a way to have some control over their lives,” he says. “People worry about the kids leaving our communities because they feel like there is opportunity only available elsewhere. This program changes their view of their hometowns.”
“We have to teach entrepreneurship,” Du Quoin Mayor Rex Duncan adds. “We have to work with the schools, the private sector and government, to teach young people about entrepreneurship and innovation as a path to careers locally. Otherwise, you’re training your best and brightest to leave your area.”
Few, if anyone in rural areas want these students to leave, because, as Lindvahl says, the future is at stake. “These are the people who will not only drive the local economy, but also will be the leaders of our communities.”