Could Little Falls Be an Enclave for Entrepreneurs?

DSC02328When people discuss what’s wrong with Little Falls, MN, they keep coming back to the economy. One of the persistent problems in the city is a lack of jobs that pay a decent wage. How do we improve the city’s overall economy so that we can address low wages and other problems facing the city?

In my continued reading of “Bowling Alone: The Collapse and Revival of American Community” by Robert D. Putnam, one of the prime factors in improving the economic outlook of a community is to improve the social capital of citizens. Cities have got to find ways to get people interacting with each other in order to build trust, social cohesion, and creativity. Social capital builds economic capital.

So, social capital is important, but how might we address economics directly?

There’s an idea I’ve been noodling for months. Why not focus on helping local residents become entrepreneurs?

My husband and I have owned two businesses in the community over the years and I’m continually amazed at how many people are running small businesses, many of which are part-time ventures. Residents have had to be resourceful because so many of us have low incomes and need to figure out how to survive. Being scrappy is a good characteristic for an entrepreneur.

Why don’t we make Little Falls an enclave for entrepreneurs? I’m thinking about businesses that employ no more than 10-20 people, tops. While people may think it’s a wasted effort to have a bunch of one- and two-person businesses (Mom & Pop shops), when you’ve got one or two people self-employed, they’re still employed, and that’s a good thing.

LF could become an enclave for entrepreneurs by offering the following in a cohesive and consistent fashion:

– Capital for small businesses (Rather than sinking large amounts of cash into big, established ventures, how many small businesses could get a foothold with a $10,000-$20,000 loan or grant?)

– Create a business incubator space with a sliding scale for rent (There could be more than one business incubator, one that’s a workshop space and another that serves as an office-type environment. I’m thinking of a non-profit incubator along the lines of one called Church & State in Utah.)

– Provide a pop-up shop space – a short-term retail space downtown that allows small business owners to test their product ideas

– Keep a registry of empty buildings to help entrepreneurs find space

– Provide a variety of classes in entrepreneurship (Classes on bookkeeping, marketing, dealing with taxes, selling online, legal issues, etc. Make these regular classes that aren’t too expensive and that are taught by those who have run businesses.)

– Rework the city’s home occupation ordinance to be more friendly to residential businesses. (If you look at the current Little Falls ordinance on home occupation, it is so restrictive that an area like Grand Avenue in St. Paul, which is a lively mixed residential and commercial district, would be unable to exist. Remember the social capital that’s supposed to be so important to a local economy? One way to build social capital is to get people mingling regularly with each other. Mixed use is a good way to do this.)

It’s too easy for communities to fixate on the one giant business that will move in and employ a large chunk of local residents. We need to quit looking for a savior from the outside to fix the city’s economic woes.  Why not create the conditions necessary to grow small businesses locally? A variety of small businesses help hedge a community’s bets against the crash of a large business. (Hennepin Paper, anyone?)

I found some confirmation for my entrepreneurial idea through this article:

For Cities, Big-Box Stores Are Becoming Even More of a Terrible Deal from Planetizen

The article discusses the many ways big-box stores have figured out to strip resources from communities, thus making communities poorer for having brought them in. The end of the article provides an alternative to the problems caused by big-box stores: Encourage locally-owned businesses.

How can we create the conditions necessary in Little Falls to grow local small businesses?

Small Towns, Big Ideas from The McKnight Foundation

DSC02068During my online surfing yesterday I found a report commissioned by The McKnight Foundation as part of its “Food for Thought” series. This particular report is called “Small Towns, Big Ideas: Reimagining Southeast Minnesota” by Jay Walljasper and it discusses how numerous towns in southeast Minnesota, including Rochester, Winona, Northfield, and Lanesboro, are reinventing themselves in order to boost their economies and invigorate their communities.

In the intro, Neal Cuthbert, The McKnight Foundation’s Vice President of Program, writes that communities throughout Greater Minnesota are struggling to maintain their vitality in the face of numerous challenges. He points out that “Many smaller cities and towns in this [southeast] region have embraced bold imagination as a way to find their place in the future.” (pg. 2) While encouraging other rural Minnesota communities to imaginatively explore new opportunities by looking at what communities in southeast Minnesota are doing, he stresses, “There is no one-size-fits-all when it comes to how a community can thrive.” (pg. 2) Basically, each community should examine what it wants to be, which direction it wants to go, without feeling the need to duplicate what’s happening in another community.

Using the report as inspiration (but not as a work-plan to copy), what direction do you think Little Falls should go? How can we reinvigorate Little Falls?

Poaching Employees

DSC02071In a recent conversation with my niece, who lives in the Twin Cities metro area and works for a national chain, she mentioned that the unemployment rate for the city of St. Paul is currently around 3.5 percent. (The Bureau of Labor Statistics posted that rate on June 3, 2015.)

It’s an astonishingly low rate and because it is this low, my niece said that it is difficult for companies to find workers, such that they often “poach” employees from each other. They do this by offering incentives, typically higher wages and better benefits, so that workers will be enticed to switch jobs.

Can you imagine such a scenario in Little Falls, where there are so many openings and so few workers that businesses would be willing to poach employees from each other? Seems like an economic fairy tale, doesn’t it?

Earlier this year in the Little Falls Area Chamber of Commerce’s newsletter, it was reported that local businesses were having trouble finding workers. According to the Bureau of Labor Statistics, Morrison County’s current unemployment rate is 5.9 percent, compared to the state rate of 3.7 percent. According to another site, the Little Falls unemployment rate is 7.4 percent. Why, when there are lots of people looking for work, is there a mismatch between local employers and workers?

Are local businesses not offering enough in wages? Providing enough hours? Are they expecting workers to walk into the job fully-trained, without being willing to invest in this training?

Are today’s potential employees just lazy? Are they happy sponging off the welfare system, getting something for nothing? I’ve heard this aspersion cast so often that I had to bring it up here, so we can face it as a factor. What might make people not want to work?

Yes, some people are happier not working, but it’s not typical for most people to remain unproductive. Perhaps the types of employment offered locally do not fulfill people’s greater psychological needs for the long-term. In which case, we need to find ways to broaden the types of work offered, make local jobs more emotionally fulfilling.

We can say, “To heck with people’s psychological needs! Forget self-fulfillment! Just earn a paycheck, pay your bills, and be happy with that.” I would argue that if you want employees who are devoted to helping your organization succeed, you darn well better care about their emotional fulfillment. However, setting that aside for a moment, if local jobs don’t pay a living wage, they are not even meeting the basic level survival needs of employees. People are going to look elsewhere for work or cobble together some form of low-level employment plus welfare benefits in order to get by.

(Before you start complaining about welfare recipients, as I know many find tempting, realize that welfare benefits are set up to keep people dependent on the system. As soon as you barely cross a low-level line set for income, you are kicked off the program and expected to pay fully for everything, from child care to health care to transportation & etc., but you still don’t have the income to do so and thus fall behind yet again, never able to crawl out of the financial hole.)

Like a business, employees are going to look for the highest return on their investment of time and skills, with the lowest personal cost. It’s a careful dance between meeting the needs of businesses and employees that creates a thriving economy.

What other factors might be fostering a mismatch between workers and employers in Little Falls? How can we bridge that gap? Do you have anything to add to the thoughts shared in this post? 

A Little Inspiration from Fargo

DSC02053In last week’s post, I discussed how Little Falls, MN, has been designed over the years to keep people apart. This leads to a lack of creativity and, I believe, economic activity. As one of this blog’s readers noted, Little Falls is not alone in its lack of social opportunities. Rural Minnesota towns have been swept up in larger societal trends that seemed like a good idea at the time … like designing our cities around cars and limited zoning districts … but that are now leading to their demise.

It doesn’t have to be this way.

The city of Fargo, North Dakota, was on its way to a dead downtown. It has been revitalized through the work of Doug Burgum, who grew up in Fargo, moved away as a young adult, and then returned. He thinks the key to a vibrant community is walkability. His story comes courtesy of Pollen. As you read it, think about ways his ideas could be implemented in Little Falls.

How can we make Little Falls more walkable? How can we encourage the formation of businesses, organizations, and events that people want to walk to?

Connecting People in Little Falls

DSC00581Back in February I wrote a post discussing how difficult it is to have a social life in Little Falls, MN. The city seems to have been designed to keep people apart, with the best gathering places being Walmart and Coborn’s. (Seriously.) We’ve followed strict zoning regulations to keep businesses out of neighborhoods. Due to the hours and types of businesses downtown, residents find little need to be downtown in the evenings. (Great River Arts and the movie theater, along with bars, are the few evening draws.)

This lack of easy places to socialize has been bothering me. After reading Chapter 7 in the book “Imagine: How Creativity Works” by Jonah Lehrer, now I know why. The chapter is called Urban Friction and it discusses how big cities that have the right kinds of neighborhoods give residents plenty of opportunities to randomly bump into each other. This increases creativity, which in turn increases productivity and innovation.

From page 187: “According to the equations of [Geoffrey] West and [Luis] Bettencourt, every socioeconomic variable that can be measured in cities — from the production of patents to per capita income — scales to an exponent of approximately 1.15. What’s interesting here is the size of the exponent, which is greater than 1. This means that a person living in a metropolis of one million should generate, on average, about 15 percent more patents and make 15 percent more money than a person living in a city of five hundred thousand.” (Lehrer, Jonah, “Imagine”)

The chapter continues by pointing out that there are certainly differences between big cities in their levels of creativity, with some being much more creative than others. What West and Bettencourt, both physicists by training who came to the field of urban statistics, discovered was that the faster people walked in a city, the more creative the city was. The more people had a chance to bump into each other through urban design, the greater their ability to turn those impromptu meetings into activities that generated creative and economic growth.

Cities that “focused on mitigating unwanted interactions, trading away crowded public spaces and knowledge spillovers for single-family homes” experience “poor performance on a variety of urban metrics.” (pg. 190-191)

In other words, if your city is designed to keep people away from each other, as Little Falls is, it’s going to be much harder to advance as a thriving community.

How do we get more people in Little Falls interacting with one another? Is it time to rethink how Little Falls is zoned, perhaps create areas of mixed use in order to encourage more interaction?

Note: As there has been some question about the veracity of portions of Jonah Lehrer’s work (see this article for details: http://www.poynter.org/how-tos/writing/188506/why-jonah-lehrers-imagine-is-worth-reading-despite-the-problems/), here is a direct link to the paper “Growth, innovation, scaling, and the pace of life in cities” by Luis Bettencourt et. al., which provides the background on the quotes above: http://www.pnas.org/content/104/17/7301.full.pdf.

Where Is the Knowledge Economy in Little Falls?

DSC00577Supposedly, the world is shifting from an industrial economy to a knowledge economy. What is a knowledge economy?

According to BusinessDictionary.com, it is an “Economy based on creating, evaluating, and trading knowledge. In a knowledge economy, labor costs become progressively less important and traditional economic concepts such as scarcity of resources and economies of scale cease to apply.”

Technology-based jobs tend to fall within the knowledge economy. So does creative content creation, particularly of a digital nature, including infographics, e-books and documents, online course curricula, and other digital content.

Investopedia has a slightly different definition:

“A system of consumption and production that is based on intellectual capital. The knowledge economy commonly makes up a large share of all economic activity in developed countries. In a knowledge economy, a significant part of a company’s value may consist of intangible assets, such as the value of its workers’ knowledge (intellectual capital). However, generally accepted accounting principles do not allow companies to include these assets on balance sheets.”

It goes on to explain that there are three main types of economies, agriculture, manufacturing, and service-based, with the knowledge economy including “research, technical support and consulting.”

While each of the main types of economies, agriculture, manufacturing, and service, depends on knowledge, what sets the knowledge economy apart from them  is its heavy emphasis on intellectual capital that doesn’t necessarily produce a physical product. Computer coding falls squarely in the knowledge economy. Research and writing and marketing and consultants putting together reports and slide decks and conference presentations are all part of the knowledge economy.

As the world shifts to the knowledge economy, where does that leave Little Falls? Are we doing anything to encourage the creation of knowledge economy jobs and businesses? Can you think of examples of knowledge economy organizations that currently exist in Little Falls?

 

 

What Sort of Town Is Little Falls?

DSC02064A number of questions I’ve posed on Ask Little Falls are attempts to determine how we define our town. Is there some identity Little Falls can adopt that people can get behind? An identity that creates community pride and draws new people in?

One slogan that’s been used in the past is “A Place to Call Home.” Because so many places can be called home, this isn’t particularly distinctive. And it’s also not true in terms of the numbers of young people who leave and never return.

“Where the Mississippi Pauses” is another slogan that has been used. This is a lot more accurate in terms of the town’s history. Little Falls is so named because we used to have a water fall here. Our falls was small in comparison to St. Anthony Falls on the river at Minneapolis. It was the Little Falls that brought industry to the community because the falls could be harnessed to provide water power. The first dam was constructed in 1849 to power a sawmill, which was used to supply Old Fort Ripley with building materials. The third dam, built in 1887/88, was the one that led to massive growth in Little Falls, both in terms of industry and population. Pine Tree Lumber Company, Hennepin Paper, and numerous other manufacturing businesses moved to the city to take advantage of the power from the new dam. The population of the city doubled between 1890 and 1895, going from 2,354 to 5,116 in that time.

So, then, is Little Falls a manufacturing town? Is this an identity we can hang our hats on?

Probably not anymore. After Pine Tree Lumber Company ceased operations in 1920, Little Falls continued to be strong in manufacturing, particularly with the boat works in town. Hennepin Paper remained a viable operation until the 1990s. While Larson Boats continues on, many of the large manufacturers have folded or left. Manufacturing isn’t as strong as it used to be.

We have a lot of farms in Morrison County. Could Little Falls be an agricultural town?

To a certain extent, we’re still known as a farming community, however, Little Falls has been swept up in larger societal trends, wherein there are fewer farmers managing larger industrial farming operations. It hasn’t paid for lots of people to remain in the business of farming. The Little Pig Market is long gone, although there are regular Farmers’ Markets. There has also been a revival in cooperative agricultural efforts with community gardens in town.

Could Little Falls be a tourist town? Perhaps. For the city’s population base, we have a lot of tourist attractions, plus we’re close to a number of recreational opportunities. Little Falls is attractive and has an interesting history, so tourism feels like a natural fit. The problem with depending on tourism for the town’s identity is that this industry tends to provide service sector jobs that don’t pay well. It’s not great for building a strong, stable economy.

What sort of identity would you ascribe to Little Falls? Do any of the aforementioned identities still fit? Does the town have a different identity? What could or should it be?

 

 

 

 

Morrison County is #1 for the wrong reason

DSC02349Morrison County was recently found to have the highest rate of binge drinkers in Minnesota, according to a study by the American Journal of Public Health on alcohol use in adults over the age of 21.

Being #1 for such a distinction is no reason to celebrate, although apparently the county’s residents know how to get their party on.

In this past week’s issue of the Morrison County Record, it was reported that the County Board recently voted no on creating a social host ordinance that would have attempted to curb underage drinking. Looks to me like we need to work just as hard at curbing adult drinking. Kind of a “lead by example” strategy.

While it may be easy to figure out which communities have the highest rates of binge drinking, what isn’t so easy is teasing out why people feel the need to binge drink. Having lived in Little Falls most of my life, I can take a stab at a contributing factor. Morrison County remains at the bottom of the socio-economic ladder in comparison with other counties in the state. A lack of jobs and a lack of decent income tends to lead to a certain hopelessness that can easily discourage a person. Imbibing in alcohol is a coping mechanism, a way to not feel so hopeless for a little while (even though it doesn’t take away the original problem).

What other reasons to you think lead to an excess of binge drinking in Morrison County and Little Falls? What strategies might we employ to decrease binge drinking?