A Tough Road Ahead for Rural Entrepreneurs

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Nov. 30, 2004--Rural America is fertile ground for entrepreneurship, according to a new study released by The Center for the Study of Rural America, a Kansas City-based non-profit group. However, the study's numbers indicate that this entrepreneurial "seedbed" is proving to be a tough row to hoe for those going it alone.

According to the report released in September, of those living in "rural areas," 22.4% are self employed--as opposed to 15.4% in "metropolitan areas."

The report states "cheap land and labor" as two reasons why rural America is well suited for business ventures and highlights why entrepreneurial ventures are so critical in giving smaller economies a jumpstart.

"Antique stores, restaurants and coffee shops all attract visitors. Hardware stores and local grocery stores cater to local residence. Small entrepreneurs make communities work," the report said. "Entrepreneurial firms benefit their communities simply by enhancing the local quality of life."

However, the report shows that while these civic benefits are immense, the financial rewards are far less apparent. The report lists the average self-employed income of a "rural" entrepreneur as $14,856, which is lower than that of a "metropolitan" entrepreneur's average income of $19,791. Moreover, these are both below the average wage/salary in those demographics, $18,052 and $23,717, respectively.

Some of the problems rural entrepreneurs face is the lack of talent in their close-knit communities and the overall lack of a consumer market.

"It's hard to get talented, educated employees to train," Bob Junkin, the sole employee and owner of Pacific Northwest Computer Services, a small computer/printer repair business in rural Oregon, said. "And once you get them trained, they become such a valued commodity you can't afford to keep them."

However, states like Nebraska and Colorado are taking a proactive approach by targeting local talent. According to Craig Schroeder from Nebraska's Center for Rural Entrepreneurship in Lincoln, states do a poor job of selling themselves to their homegrown talent.

"Young people from rural areas want to stay," Schroeder said. "It's not a reflection so much of the kids but more what they have been told."

The city of Littleton, Colo., has tried to cultivate local talent by giving its library system a funding boost for business market research materials in hopes of spawning entrepreneurs. According to Don Macke, also from the Center for Rural Entrepreneurship, it's paid off.

"Littleton believes that move directly or indirectly helped the creation of 22,000 new jobs," he said.

However, those who choose to start their own businesses in rural America seem to have their own reasons for staying close to home, and they don't seem to be rooted in a financial quest.

"Everyone knows there's more money in the cities," Junkin said. "But your standard of living is so much better here. I guess it's a matter of you can't have your cake and eat it to."





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