Using resident and business input to meet the challenge.
- Clara Boudette -
Fears of economic downturn and rising inflation are testing local governments' capacity to prepare for coming economic challenges. Connecting with local businesses to understand their needs and struggles will allow communities to adjust to what may come.
The Washington Post reported inflation is at the second highest level in four decades, 9.1% in June. Businesses are straining under the pressure of inflation and rising prices.
Operating costs of vehicles and equipment due to the rising price of gas and energy are getting to be too expensive. Restaurants and catering services are pulling lobster and high-end meats from their menus due to fluctuating prices. And the price hikes are making it difficult for many people to shop locally.
Experts expect overall economic growth in the U.S. to decline in the coming months. Unemployment is currently hovering around 3.6% according to the Bureau of Labor Statistics. But the job market could begin to shrink in the coming months as the government takes stronger measures to tackle inflation, Bloomberg reports.
“To fight inflation, the Federal Reserve has been raising interest rates, with the goal of cooling the economy just the right amount to orchestrate a so-called ‘soft landing,’” Claire Ballentine wrote in Bloomberg News. “The risk is that the hikes reduce consumer demand too much, leading to a reduction in corporate profits and job losses.”
High unemployment often leads to governments leveraging tax breaks to draw in large corporations, in turn bypassing revenue that could instead go to schools or elsewhere in the community.
“The consequence of that is we have to be more prudent with our resources,” said economist and Polco CEO Nick Mastronardi. “We can’t levy these huge tax breaks to drive growth. We have to figure out if there’s low hanging fruit.”
Local governments can’t afford to ignore local businesses' concerns and input during this challenging time. Reliable insights from residents and businesses is essential for local governments to make smart economic decisions. Surveying is one of the most effective ways to collect that data.
The National Business Survey® (The NBS®) assesses the perspectives of local business owners and managers to reveal the economic health of the community. This online tool tracks business expectations for the coming year, identifies characteristics of the business environment needed to enhance local economic vitality, monitors the kind of services and policy support that would allow local businesses to succeed, describes local companies and shows business owners’ perceptions of the quality of current services and community life.
The National Community Survey® (The NCS®) allows leaders to gauge residents’ attitudes on economic development, employment, and cost of living, providing officials with a fundamental base for understanding their local economic landscape.
In addition to the NCS and the NBS, Polco’s survey experts at National Research Center are developing the Economic Development Workforce Survey (EDWS) to help plan for growth by exploring a community’s strengths and weaknesses related to economic development. The EDWS elicits residents’ views on economic vitality, job opportunities, satisfaction with employers and training needs.
“The goal of the NBS and the EDWS is for you to help figure out where the frictions in your economy are,” Mastronardi said.
Once the pain points are understood, there are some relatively simple—and cheap— changes local governments can make to improve economic development. Sometimes, it’s as simple as creating a community job board.
“There are low cost things we can do to connect entrepreneurs with capital, and labor supply with labor demand,” Mastronardi said. “That might be educational retraining, maybe it’s just a bus line, maybe it's multifamily housing nearby.”
Now is not the time to panic as communities face fiscal challenges. Rather, it’s an opportunity to identify areas of improvement and leverage clear insights to be better prepared for the future.
The NCS, NBS, and EDWS identify these opportunities for growth by collecting resident input on availability and quality of employment and cost of living. These community engagement tools bring actionable change to communities by recognizing the unique needs of residents and allow for better task prioritization based on direct feedback.
Related Articles
