Ever wondered about the buzz around supporting local economies? From buying local produce at the farmers' market to supporting local businesses, there's a growing trend of individuals and communities investing in their local economies. But why exactly do local economies matter? Let's delve into the three main reasons.
1. Contribution to National Economy
One of the most crucial roles of local economies is their contribution to the national economy. Local economies form the building blocks of a nation's economy. They generate a significant portion of the country's Gross Domestic Product (GDP).
Let's consider some statistics. According to the Small Business Administration (SBA), small businesses (which are a major part of local economies) contribute to 44% of U.S. economic activity. Furthermore, small businesses created 1.8 million net jobs in 2019 alone. These figures underline the financial role of local economies in bolstering the national economy.
2. Job Creation and Community Development
Another major reason why local economies matter is their role in job creation and community development. Local businesses tend to hire locally, providing jobs to residents and reducing unemployment rates. Additionally, when you spend money at local businesses, that money is more likely to stay in the community, fostering local financial growth and development.
Here's a comparison table showcasing the impact of local and non-local businesses on job creation and community wealth:
3. Economic Sustainability
The third reason why local economies matter is tied to economic sustainability. Local economies, by their nature, are more resilient to global economic downturns. They have a more diversified economy which can adapt to changes and challenges more effectively than larger, more monolithic economies.
Moreover, local economies promote sustainability by encouraging local production and consumption, which reduces the environmental impact of transportation.
In conclusion, local economies play a vital role in national economic development, job creation, community development, and sustainability. Therefore, supporting and investing in local economies can lead to a more robust and sustainable economic ecosystem.
So, next time you think about where to invest your money or where to buy your groceries, remember these three reasons why local economies matter.