Development of Business in the Economy
Businesses are the lifeblood of the economy. In order to keep the economy moving and growing, it requires a steady stream of businesses that are selling, growing, and innovating. Economic development corporations are essentially in the business of keeping business is going. Because it is essential for any region to have businesses develop, thrive and grow, these development corporations do what they can to ensure that growing businesses remain a part of their region and that new businesses are always being developed and supported in order to get a chance to grow and succeed.
The actions of a community or economic development corporation are always intended to lead to an increase in business. Much like a "chicken or the egg" scenario, it can be difficult to determine which action needs to take place first in order to spark business growth and economic development. Taking action to make a region more attractive for businesses may or may not succeed, and in turn a business that does not thrive does not do much to help economic development.
Attracting larger businesses can feel like a huge win for community. This kind of success story is rather difficult to attain, as not every community or region has the necessary criteria to become a new site for a larger business in every industry. What can still help communities instead is to attract smaller businesses and encouraging or incentivizing locals to become small business owners. Small businesses account for over half of all sales in the United States, as well as over half of all jobs since the 1970s. For these reasons, among others, it is important for economic development corporations to work to support small businesses and help them grow and expand into larger ones. This added entrepreneurial spirit will help foster growth and development and create new jobs in the region. There is also the potential for a rapid-paced “gazelle” growth, which will quickly turn a new small business into a larger firm through innovation.
It is always in the best interest of an economic development corporation to assist whenever possible to allow businesses to succeed and grow. Businesses that fail or stagnate run the risk of shutting down or relocating to other regions. This often leads to job loss for the local workforce, increasing unemployment rates. Retaining businesses is always a key point in a development corporation’s strategy.
Aiding businesses of all sizes will lead to increases in economic development in a region. Many economic development corporations have created a list of target industries they wish to foster or support, as including those industries into a region’s economy will either help to develop the workforce and infrastructure and in turn provide a boom for other related industries, or the region already contains many resources that make it ideal for certain industries to thrive quickly and easily.