retail news in context, analysis with attitude

The US Chamber of Commerce is out with a new study suggesting that “unlocking the digital potential of rural businesses across the U.S. could add over $140 billion to the U.S. economy over the next three years and create an additional 360,000 full-time jobs in rural communities.”

The report was commissioned and underwritten by Amazon.

The study goes on:

“There are 37 million working-age adults and 18 million households in the rural U.S. While accounting for close to 15% of the adult population and nearly three-quarters of the country’s land mass, annual revenues of rural businesses represent only 3.7% of total gross revenues in the U.S. economy. Despite some improvement in the adoption of digital tools by rural businesses over the past years, this new research shows how increased use of digital technology in rural America could help drive faster growth in the rural economy.

“Greater adoption of digital technology over the next three years could grow revenues of rural businesses by $84.5 billion each year (+21.0%), with states in the South realizing the greatest benefit. Online tools and technology have the highest potential impact on rural businesses with revenue under $100,000, which could see sales growth surge over 28% over three years.”

Jeff Wilke, CEO, Worldwide Consumer, Amazon, pout out a statement saying that “ensuring that small businesses in rural America have good digital skills, are able to attract tech talent, and benefit from fast connectivity will deliver increased economic prosperity in rural communities.”

Other conclusions from the study:

• Nearly 41% of respondents agree that policymakers should create programs to incentivize rural businesses to incorporate digital technology into their daily operations.

• 38% of rural small businesses say they can’t hire the talent with the right digital skills in their area.

• Two-thirds of rural small businesses in America say slow internet or cell phone connectivity has a negative impact on their business.

• Nearly 20% of rural small businesses in America generate the vast majority of their revenue (at least 80%) by selling their products and services online.

• Rural businesses say adoption of digital technologies are important for their future, with 55.2% of them agreeing that e-commerce helps them grow their customer base and a similar percentage (54.6%) confirming that online tools had a positive impact on their revenue in the past three years.

• 29% of rural businesses say that online tools reduce purchasing costs of products and materials.
KC's View:
Am I wrong and deeply cynical when the first thing that occurs to me is that if Amazon really believed this, it would’ve chosen a small town in Iowa or Mississippi or Nebraska for its HQ2 campus, rather that New York City and a suburb of Washington, DC?

Just asking.

I don’t think that anyone will question the conclusions of this study - that in 2019 and beyond, greater digital skills lead to greater economic value.

The real question, for me, is what combination of public policy and private enterprise will lead to initiatives that will prepare these communities for the future.