Large rural manufacturers may be more innovative than urban ones - Entrepreneur Generations

"Large manufacturing firms in rural America are at least as likely as similar urban firms to use innovative methods that can contribute to job creation and increased earnings, a new report says," Bryce Oates and Tim Marema report for The Daily Yonder.

The US Department of Agriculture's Economic Research Service looked at data for non-farm rural economic sectors like manufacturing and services from 2010-2014, when the overall economy was recovering from the Great Recession. Most of the rural manufacturers studied were in pharmaceuticals, chemicals, computers, plastics and textiles.

The results? About 53 percent of large rural manufacturers (those with over 100 employees) were 'substantive innovators', compared to 49 percent of large urban manufacturers. "That means those firms did things like reform their business practices based on customer feedback, create new products or significantly modify old ones, analyze data to evaluate progress and efficiency, and use trade-secret protections like non-disclosure agreements or non-compete clauses," the Daily Yonder reports.

USDA graphic; click to enlarge it.

High scores in innovation matter because, as the study also showed, job growth is faster in highly innovative rural industries than in non-innovative rural industries. During the time period studied, innovative manufacturers added 153,736 jobs, while non-innovative manufacturers added 130,345 jobs. "The strongest employment growth in the rural innovation sector during the economic recovery period came from transportation equipment, beverages and tobacco, machinery manufacturing, scenic/sightseeing transportation, fabricated metals, and data processing. For the non-innovation sector, the strongest growth was seen in mining support activities, water transportation, oil and gas, and pipeline activities. Significant decreases were found in the rural communications sector, including publishing, broadcasting, printing, and telecommunications," the Daily Yonder reports.

The results are preliminary and will need more study, but it upends the assumption that urban employers channel advantages like better internet connectivity or more potential skilled workers into more innovative practices.

from The Rural Blog http://ift.tt/2xo2gqe Large rural manufacturers may be more innovative than urban ones - Entrepreneur Generations

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