Small Businesses Are Struggling In Rural Counties, Says NC Rural Center
A recent report from the North Carolina Rural Center shows small businesses in rural North Carolina have been disappearing at what some call an alarming rate. The report, "Small Business Dynamism in North Carolina," says between 2005 and 2015, rural North Carolina lost more than 4,000 'very' small businesses. That's a 7% decline in the number of small businesses that have fewer than 10 employees.
But notably, small businesses in the state's six main urban counties – including Wake, Durham and Chatham – experienced a 9% jump in small business growth. The report shows an additional 5,534 small businesses emerged.
Patrick Woodie, president of the NC Rural Center, says it is of great concern that small businesses in the rural parts of the state did not survive the Great Recession.
“Seventy-five percent of all business establishments located in the 80 counties that the Rural Center serves, have fewer than 10 employees. So small business is really the big business of rural NC in a lot of ways," said Woodie.
One of the main reasons small businesses have been hurt is because of the elimination of many bank branches in rural areas. This means access to capital has gotten tougher. Woodie says 165 rural bank branches have closed between 2005 and 2015.
“We have seen some rural communities that have closed the doors on their last rural branch, which creates an incredible hardship and challenges for the small businesses that still operate in that community," said Woodie. "Where do they take their daily deposits? How do they access the services that they still need to access at brick and mortar locations?”
The report shows between 2005 and 2015, rural counties experienced a 61% drop in small business lending, equaling more than $1.6 billion.
One way Woodie says they are trying to address the problem is with the Rural Center's new nonprofit subsidiary, Thread Capital. It provides entrepreneurs loans of up to $50,000.
One of the loan recipients is Mica Town Brewing Company in McDowell County. It is the first brewery in the City of Marion, which has a popoulation of about 7,800 people. Mica Town Brewing is named after the old Mica mine in McDowell County.
Emily Causey owns the brewing company with her husband, Jason Snyder. They opened the brewery on New Year's Eve, 2017. Causey says there were a lot of empty storefronts when they moved to the city in 2016, but that is starting to change.
"It's a bit surreal somedays," said Causey. "We are glad to be part of the revitalization of Marion."
Woodie says Marion is slowly becoming a small town success story, which he would like to see replicated statewide.