Towns with Small Businesses are Healthier

October 12, 2012

Entrepreneurs instill a can-do spirit and a stronger sense of community into their hometowns.

Having a lot of entrepreneurs living in your community can be good for your health. That’s the message of a recent study, which found that people who live in counties with a high number of small businesses have lower mortality rates, lower levels of obesity and are less at risk for diabetes than areas that rely on a few big employers. That’s because entrepreneurs tend to instill a can-do spirit and a stronger sense of community into their hometowns, researchers suggest. As a result, people are more likely manage their local affairs and to tackle problems, like issues of ill health among their townsfolk.

The study’s findings, based on health, business and housing data from more than 3,000 counties across the US, are important because there has been a lingering fear that the rise of small business in our economy may not actually be good for our health. Globalization, which has seen many US blue-collar jobs move overseas, has triggered an increasing emphasis on measures to stimulate local economies. So even though small businesses have been responsible for creating nearly 80% of new jobs in recent decades, some academics have fretted that these are “low quality jobs”, which tend to pay less and don’t offer medical insurance, unlike the jobs created by big corporations. A bustling homegrown entrepreneurial culture, however, helps create a strong sense of belonging to a community that helps instill a desire to address local public health problems, the researchers from Louisiana State University and Baylor University argue in their paper. “Our analysis demonstrates that communities with a greater concentration of small businesses… have greater levels of population health,” they state. The reasons, they suggest, are that those communities may be more likely to push measures like local bond issues to raise money to build hospitals and clinics, hire doctors and medics for the community, lobby for local health programs like anti-smoking legislation, and support healthy eating through the likes of local farmers' markets. In contrast, those communities dominated by one or more large corporate employers become dependent on outsiders to address local problems, the paper says. When the interests of a big employer and those of a community diverge, the employer’s interests tend to prevail, because it can always threaten to relocate. As a result, there’s a much lower level of community participation, because corporate goals tend to take precedence over local interests. An investment in locally grown enterprise has the potential to yield large returns for communities, the researchers say, which are likely to go far beyond a community’s health. Although they haven’t studied the wider effects of a thriving local small business community, the academics suggest the benefits are likely to extend to other indicators of well being, such as lower rates of crime and suicide and better school performance, drawing more people to move into, rather than out of, the area. So, if you want to live in a town that’s healthier and probably happier, you might want to take a walk down Main Street to see how many small businesses are in town.