Good help is hard to find, especially in rural America.
Hi, welcome to another episode of Bring Back the Bustle, a podcast about revitalizing rural America. I’m Shavon Jones, your host. This episode is about staffing issues in rural America. We’re going to delve into the root causes of skilled labor shortages in small towns then suggest ways to mitigate those problems so we can launch businesses with reliable labor, make money, and Bring Back the Bustle to rural America.
It’s mindboggling how many customers much of American industry leaves on the table by limiting our presence in rural America. Rather than right sizing our businesses to serve smaller communities, rural America is all but ignored by the entertainment sector, the hospitality and tourism sector, the fitness industry, and luxury purveyors of everything from food to furniture to transportation.
The topic of right sizing an offering for rural communities is one that deserves its own episode. Today, we’re talking about why most businesses don’t even bother with rural America.
Myth #1: There’s No Money in Rural America
The over-arching reason is that we don’t believe there’s any money in rural America. I mean the cost of living is low and the people are poor. So, at first blush, you think there’s no money to be made there. However, the large number of community banks in rural America would suggest otherwise. Someone has money in the banks or the banks would shutter.
One of the reasons Walmart is the largest retailer in the world is because it does not ignore rural communities. Walmart has more than 4,500 stores in the US even though there are less than 350 US cities with a population of 100,000 or more. They are making money in rural America, and we can too.
Further, think of all the money rural people spend on vices such as opioids, cigarettes, alcohol, and gambling. That’s an indicator that they have money. They just don’t have a broad selection of offerings to choose from. Only vice purveyors are competing for their money in the non-essential categories. But with tax and economic development incentives, we’ve discovered the way to compete for discretionary income in rural America.
Why Is Staffing Difficult in Rural America?
But staffing problem is real. We’re in the problem-solving business at the Rural Fund. So, let me begin by identifying the problem before thinking through and posing solutions.
Some of the problems that prevent rural Americans from working include rampant drug addiction (first it was crack, then opioids, now its mojo—I can’t even tell you what that is), chronic illness (including HIV, some of it from prostitution since there are few ways to make money), and lack of education or training (many people had skills in the trades, including construction and machinery, but the skills atrophied from nonuse).
There are some who cite, as reasons rural people don’t work, an over presence of social safety net programs (but this is America, we can’t just let people starve. After all, the government pays farmers for the food provided in these safety net programs. There’s certainly no clamor to end farm subsidies), large women-led families, and men with criminal records (those 2 kind of go together because the women are leading families only because the men can’t find work due to criminal records. And, in a way, these women are keeping the American-born population afloat as more affluent women have fewer children).
Another problem is scandalously low wages in rural America. Why take a job as a home health aide for $8 an hour when a fast food meal costs $11. It is clear exploitation if someone has to work longer than an hour to buy lunch. The low wages lead to rural brain drain where most people with education move away to earn a living wage.
Now we know what the causes of rural labor shortages are: addiction, disease, lack of education and training, atrophied skills, parental responsibilities, criminal records, and low wages.
When you think about it, each of these is a chicken and egg problem. Did the residents lose their jobs because they were opioid addicts or did they become opioid addicts because they lost their jobs? I think all of the problems I mentioned earlier are economic ones. Rural America once bustled. It didn’t fall into despair on its own. The despair resulted when government and industry gave up on rural America.
How to Resolve Rural Staffing Issues
Napoleon Hill pointed out, in his book Think and Grow Rich, how a busted man gets pep in his step if you give him a good job that’s not exploitative. I don’t know any man who doesn’t want to support his children or provide for his partner.
So, if we build it, they will come. If we bring jobs to rural America, the residents will step up and take them. But they will need some help from us, and they’ll need to believe that we are there to stay. That we care about them, their future, and their families. What’s the appropriate way to support local labor? It depends on each person’s impediment to holding down a job.
- If it is addiction, we need state and local government to make available free treatment programs to those who are ready to get clean. Not everyone will take advantage of the opportunity, but enough will to fill some of our jobs.
- If it is HIV or other illness, we need to make reasonable accommodations for these disabilities and placed these people in roles they can carry out without injury to themselves or the public.
- If it is lack of education or training, we will need to recruit experienced hires out of the local area to get started. But we should work with local high schools, trade schools, and colleges to train the local workforce for entry-level roles.
- Atrophied skills is the easiest problem to fix due to muscle memory. If you put the person back to work and have patience, they’ll remember or relearn the role.
- If parental responsibilities prevent some from working, provide affordable childcare.
- If it is criminal records, stop making people check a box or revise your policy so as not to exclude those with records.
- If it’s low wages, that requires rethinking on your part. You can’t slavishly adhere to Milton Friedman principals of shareholder take all. If you take that approach in rural communities, “All” could be 100% of nothing. When you have a small population or small labor pool, there aren’t as many replacement workers if you run away those who want the job. Paying a living wage will lead to retention and lower recruiting costs in the future. So, don’t think of paying more as losing money. Think of it as saving on costs.
The solutions, as you can see, are obvious. I didn’t say anything new or deep. What’s missing is resolve on our part to address the issues. From an HR standpoint, we need to be prepared to offer long-term support for local labor. It is in our interest to provide that support so our businesses can operate in rural America rather than leaving all that Walmart money on the table.
How to Invest in Rural America
At the Rural Fund, we develop and operate small businesses that solve pain points for rural communities near AI data centers. We’re privately held. We operate in this manner to give our shareholders a piece of the action from the properties we invest in and develop. It makes shares in our fund much more valuable than if we held only naked real estate that we leased out. We choose to play in rural communities because so many others have left that space available to us.
I invite you to visit our website (www.ruralqrof.com) to read more about how we use local labor to operate businesses in rural communities. I’m Shavon Jones. I will be here again next week talking about rural revitalization. I’m looking forward to it, and I hope you are too.
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