Sunday, July 14, 2024

As pandemic crushes small businesses, state needs a plan, N.C. rural leader says

Mike Hawkins is chairman of the Transylvania County Board of Commissioners. The president of Pisgah Enterprises, a commercial and residential real estate development company and operates the Pisgah Fish Camp restaurant in Pisgah Forest.  He was named N.C. Rural Advocate of the Year by the N.C. Rural Center in 2019 and serves on the Economic Development Partnership of North Carolina. He has bachelor’s and MBA degrees from UNC Chapel Hill.

By Mike Hawkins

I read Adam Klein’s thoughtful analysis of downtown rebirth on  coming out of COVID – it is encouraging. (The article was published on Business North Carolina’s website.)

But it doesn’t speak to another, just-as-important issue — COVID’s impact on rural downtowns and rural small business.

This pandemic has highlighted the importance of small business to communities around the state. This is pronounced in rural areas but is true everywhere, urban and rural. These businesses are main street backbones, and while they don’t generate great wealth – the really good, really smart small-town small business owner might take home $50,000 per year — they do provide a vital source of local jobs and social stability.

So in this context, “small business” really means “jobs,” “social stability,” and “social mobility” for rural North Carolinians.

This category includes small retail, small personal services, restaurants, agriculture (single family farm), solo entrepreneur, skilled trade, rural media, etc. They are truly small, most are 10 employees or less. But these businesses are the backbone of rural life, they really are. And have been for generations.

Many of these businesses are being crushed by the pandemic. Many in the East are having this hit after the succession of hurricane disasters. But even those that weren’t hit by the hurricanes have current operating conditions which are threatening their survival.

The short term solution has been a quilt work of disaster loans, from Golden Leaf/Rural Center, from the Paycheck Protection Program, from SBA Disaster. These are vital with the immediate concern of surviving the next six months, they are less helpful beyond that. We could see a spate of defaults and bankruptcies in the fall and winter. In fact, based on what I see in my rural experience, I’m pretty sure that is exactly what is going to happen.

Traditionally this business sector has received relatively little attention/support from our traditional economic development organizations, who focus on manufacturing and other higher profile / higher return targets. We should expand that focus.

We need to examine the precarious position of small business in North Carolina. We should look at it across a spectrum of aspects, including:

* Financial

* Structural and Operational

* Strategic understanding of the new marketplace dynamics in North Carolina.

* Legal

* Success examples and lessons learned

An initiative specifically targeting small business issues would be innovative and demonstrate our commitment to economic security for all North Carolinians. If done well, it could provide really important ideas to use in the upcoming years.


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