Gail L. Cramer
Rural development makes America a better place in which to live and work. Rural development emphasizes the well-being of people rather than economic growth itself. Development increases real per capita incomes and employment as well as improves housing, fire and police protection, schools, libraries and other government services. These quality-of-life amenities in rural communities are directly influenced by farmers. Also, the well-being of farmers is affected by communities.
Rural communities are the service and shopping centers for farmers – where they buy supplies, market their products, handle their finances, purchase their food, educate their children and spend their leisure time. Rural communities de pend on farmers to provide employment and a desirable place in which to live. Most farm people feel the quality of life in rural America should be comparable throughout the nation. Farm and rural families are no different from urban families in that they are concerned about the quantity, quality and costs of the public and private goods they purchase.
According to U.S. Department of Agriculture’s Economic Research Service, rural America includes 2,052 counties or parishes, contains 75 percent of the land in the United States and is home to 49 million people – 17 percent of the population. Retail trade, services and manufacturing are the main economic forces in rural America.
Maintaining quality services in rural communities is the result of community involvement and a progressive governance structure at the local and national levels. Federal and state grants as well as taxation policy can significantly determine the quality of schools, hospitals, libraries, parks and other services.
In the past, economic growth in rural areas was tied to agriculture, and increasing commodity production provided substantial economic growth. With changes in farm technology and the industrialization of agriculture, agriculture has consolidated, resulting in fewer and larger farms. As production has moved to bigger farms, agriculture’s impact on the local economy has been reduced. These larger farms purchase their inputs and market their products in larger trading centers, bypassing local dealers. In addition, the industrialization of agriculture has reduced links to local communities. Industrialized farmers receive their inputs from major processors and market their outputs to national processors, again bypassing local communities.
In recent years, growth in employment and income in rural communities has come from attracting agricultural related industry, entertainment, tourism and entrepreneurial investment.
Agricultural-related industry and value-added agricultural activities provided jobs and employment to rural areas. However, recent globalization and the flat world economy have decreased the need for the resulting industries in rural areas since the products can be produced as effectively elsewhere in the world. Attracting entertainment and tourism is a niche market. Casino gambling and scenic attractions can be exploited in some areas; however, they are constrained by the political, geographic and natural characteristics of an area.
Entrepreneurial investment seems to be the best alternative for sustained economic growth in the future. Developing and inspiring entrepreneurial investment tries to exploit an area’s comparative advantage – a region tries to develop those activities that can take advantage of its natural and community resources. For example, a sweet potato processing facility would be located to take advantage of the location of production, local labor supplies, transportation costs, costs of other inputs and distribution costs.
The land-grant universities, through experiment stations and extension services, have delivered research results and outreach programs to rural communities that provide the basis for economic development. Extension services also have provided leadership and business training.
The LSU AgCenter develops several innovations and inventions per year, providing driving forces for economic development. This issue of Louisiana Agriculture highlights rural development as it influences the quality of services and growth in rural Louisiana. Particular emphasis is placed upon education. Education is vital to development by training a productive and innovative workforce able to compete in a global economy. An emphasis on education needs to begin at pre-kindergarten and continue for a lifetime. A lifetime of education is the prerequisite to a quality workforce.
Also, higher education is needed to advance technology. This investment in human capital can create a quality workforce that can use the technology to produce new products in rural areas and market those products anywhere in the world. Information technology in rural areas adds another resource to give rural communities the same advantages as urban areas.
The Internet has allowed people to live anywhere. Rural communities must position themselves to be able to appeal to those workers who want to live in a smaller, close-knit community. The quality of available labor appears to be a major consideration to rural business establishments in planning a business location or siting technology companies. The areas need to be attractive places in which to live for the owners, managers and professional employees to relocate. These communities need to be able to market such things as low crime rates, community activities, beautiful parks and good school systems.
Rural manufacturers have excellent access to foreign markets. A recent study found that when similar plants are compared in rural and urban places, there is no difference in participation in export markets. Also, a lack of access to capital in rural areas was not a constraint. Both rural and urban establishments had equal access.
The Louisiana Cooperative Extension Service has full-time AgCenter faculty members and full-time area agents working in rural development throughout the state. The Louisiana Agricultural Experiment Station has full-time researchers dedicated to rural development strategies.
Studies underway include:
- Impact of welfare mothers moving from public assistance programs to the work force
- Achievement levels of students in rural schools
- Strategies to reduce persistent poverty in rural areas
- Costs of rural care facilities
- Formation of cooperative forestry associations to improve the return from forestry resources
Programs being implemented include:
- Grant-writing workshops
- Developing new technologies in agricultural production and processing industries
- Economic impact analyses of rural investments
- Economic feasibility studies
- Development of business plans Leadership programs and community resource assessments
LSU AgCenter research and policy analysis focuses upon socioeconomic well-being of rural households, the effectiveness of federal and state assistance programs and factors influencing rural infrastructure, agribusiness, and industrial and economic bases of rural areas.
The USDA’s Rural Business-Cooperative Service is committed to the future of rural communities. They have offices in all states (for example, Alexandria). They offer business and industry guaranteed loans and renewable energy and energy efficiency programs. Other programs are enterprise grants, opportunity grants, rural economic development loans and rural economic development grants. In 2003, they made 623 loans and 703 grants totaling $1 billion. They estimated they created or saved 87,615 jobs and served 11,904 businesses in rural America. Also, state government has been active in promoting economic development through grants, incentives and tax policy. Offices involved include economic development, Office of Community Programs and rural development. The AgCenter is cooperating with these and many more organizations at the national, state and local levels to enhance the quality of life in Louisiana.
Gail L. Cramer, Professor and Head, Department of Agricultural Economics and Agribusiness, LSU AgCenter, Baton Rouge, La.
(This article was published in the fall 2005 issue of Louisiana Agriculture.)
