3 Ways Business Leaders Can Help with Boosting Local Economies
Cities, though public entities “owned” by their governments and residents, are dependent upon private businesses. The success of the private sector — and the improvements fueled by businesses — makes many other aspects of community life appealing. This includes everything from enhancing 5G connectivity to creating environmentally friendly infrastructures. Every project is designed around boosting local economies.
Businesses benefit from these efforts, too. As cities attract more residents — and more tax dollars — communities’ resources are improved. Also, opportunities arise and additional talent moves in. Tech- and STEM-oriented companies thrive in cities with access to engineering talent and business-positive policies. It’s good business sense for leaders to invest in their businesses and communities. As a result, there is a shift from a short-term location fit into a long-term investment strategy.
How can business leaders contribute to boosting local economies? While private entities may feel they have limited impact on their cities, nothing could be further from the truth.
Businesses can invest in sustainability.
While many cities would like to be greener, it gets costlier for cities to invest in sustainable practices as they grow. This can be challenging for boosting local economies. As a Sustainable Cities International report explains, “Servicing widely spread communities with public infrastructure (roads, transit, water, and wastewater, etc.) is also more costly — as the distance increases, so do the capital and operating costs of the roads and pipes.” Expand the scope to include recycling and city composting programs, and it’s easy to see why many cities simply can’t afford it.
However, businesses can invest in sustainability initiatives. These benefit their companies and communities. It could be by updating light fixtures to use energy-efficient LED bulbs, creating bicycle-friendly facilities, or establishing recycling programs. Companies constructing buildings or upgrading existing ones can follow LEED certification practices. This strategy saves water and energy and produces less waste. “Green” office buildings can increase a property’s market value by $5 million based on existing capitalization rates. This adds a lot of money to a community’s coffers and boosts local economies.
Businesses can aim their technological improvements at their cities.
Public sector policies undoubtedly play a part in promoting tech development in cities. McKinsey & Company reports that a U.K. government growth initiative led to a significant increase in digital and creative companies in the London’s East End. Within three years, the number of companies went from 11 to 300. Yet, while government investment in high-tech efforts certainly pays off in terms of jobs, businesses’ high-tech investments can benefit cities in other ways.
It’s easy to see how companies that invest in technology infrastructure, such as improving internet connectivity or implementing IoT-centered technology, can impact their communities. Just look at how Google Fiber fueled growth in Kansas City, Missouri. But, tech companies built on the platform model can aid their cities, too. For example, Airbnb has helped revitalize urban neighborhoods. Then, Uber has shared its data to help reduce urban traffic congestion. Platform models enable workers to establish opportunities where they may not have existed before. This creates jobs and stimulates other opportunities. Examples include offering additional transportation options to creating ecosystems for selling goods.
Businesses can empower local cultural assets.
When public education budgets get squeezed, one of the first areas to suffer cuts is the arts budget. The logic goes that few students will find careers in music or art. However, there will be many jobs needed in the business and tech sectors. Therefore, money is allocated to those subjects instead. But, many U.S. mayors disagree, mentioning arts and culture as a major economic development factor in their “State of the City” addresses. In San Antonio alone, the city’s symphony generates $222 million of employment income annually. The lesson is clear. The arts are not only alive, but they’re also fueling economic growth.
Business leaders have the power to ensure local cultural assets have the funding they need by investing in them. In St. Louis, Ken Kranzberg, founder of TricorBraun and Kranson Industries Inc., and his wife Nancy, who has worked with the Saint Louis Art Museum and the Contemporary Art Museum St. Louis boards, have long recognized the value of arts investments. The couple participates in the Laumeier Sculpture Park capital campaign. Also, they assisted with the community art studio Northside Workshop and started the Kranzberg Arts Foundation.
Located in St. Louis’s Grand Center Arts District, the foundation represents a major investment in the area. Programs provide space and resources to support local performing arts organizations. Hoping to spark up-and-coming neighborhoods and spur revitalization in historically significant ones, the group’s innovative and sustainable funding model pairs commercial investments with philanthropic efforts. Examples like these give businesses an opportunity to put their money where their cities’ hearts are, boosting the economy and keeping people rooted in their cities.
Playing a Key Role
While cities are public entities businesses within them still have a major role to play. If anything, they are helping them thrive and boosting local economies. The reciprocal relationship formed between cities and businesses keeps both vested in supporting each other. As cities invest in their communities and fuel their growth, they may find themselves in locations they can’t afford to leave.