Small Business Economic Development

Economic development means different things to different people.

Economic development is defined as an important part of strengthening communities by creating and retaining jobs.  From a public perspective, local economic development involves the allocation of limited resources -labor, land, entrepreneurship, and capitol in a way that has a positive effect on business activity, employment stability, income distribution, and fiscal stability.

Anything a community does, on a broad scale, to foster and create a healthy economy can fall under the auspice of economic development. There are probably as many definitions for economic development as there are people who practice it.  Today’s economic development professionals are trying harder than ever to define their field in terms that are more concrete and salient to policymakers, the public, and other professionals.

It is a strategy of intervention in the normal economic growth by making it easier or more attractive. Today, communities in across the country are giving attention to what they can do to promote fiscal stability and greater economic development.

Economic development is a concerted effort on the part of the responsible governing body in a city or county to influence the direction of private sector investment toward opportunities that can lead to sustained economic growth. Sustained economic growth can provide sufficient incomes for the local labor force, profitable business opportunities for employers and tax revenues for maintaining an infrastructure to support this continued growth. There is no alternative to private sector investment as the engine for economic growth, but there are many initiatives that you can support to encourage investments where the community feels they are needed the most.

Economic Development Resources

Economic Development Administration provides grants that are designed to accelerate innovation and entrepreneurship, advance regional competitiveness, create higher-skill, living-wage jobs, generate private investment, and fortify and grow industry clusters. They help communities to fulfill regional economic development strategies.  Although there are many good books written on the subject of economic development, one of the best by far is titled Economic Development for Everyone: Creating Jobs, Growing Businesses, and Building Resilience in Low-Income Communities by Mark Miller.

Economic Development

It is important to know that economic development is not community development.  Community development is a process for making a community a better place to live and work. Economic development is purely and simply the creation of wealth in which community benefits are created. There are only three approaches used to enhance local economic development. They are:

  • Business Retention and Expansion – enhancing existing businesses
  • Business Expansion – attracting new business
  • Business Start-ups – encouraging the growth of new businesses

 

The HUD Office of Community Planning and Development (CPD) seeks to develop viable communities by promoting integrated approaches that provide decent housing, a suitable living environment, and expand economic opportunities for low and moderate income persons. The primary means towards this end is the development of partnerships among all levels of government and the private sector, including for-profit and non-profit organizations.

Consistent with these objectives, the Office of Community Planning and Development has developed a set of underlying principles that are used in carrying out its mission.

  1. Community building begins with job creation, employment, and creation of safe, decent and affordable housing.2. Planning and execution of community development initiatives must be bottom up and community driven.3. Complex problems require coordinated, comprehensive, and sustainable solutions.4. Government must be streamlined to be made more efficient and effective.5. Citizen participation in Federal, State and local government can be increased through communication and better access to information.
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