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Business Desert = Opportunity Oasis

Business and Economy

Business Desert = Opportunity Oasis

Business and Economy

Filling the Void In Counties Lacking Key Businesses

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Much has been said and written about “food deserts” — communities and neighborhoods where residents have no access to nutritious, high-quality food.

While areas with no grocery stores are an inconvenience for residents with means, they are especially difficult for low-income, disabled, elderly and other at-risk groups with limited access to resources, such as transportation.

Are business deserts unique to food and grocery stores? In short, no. Business deserts can exist for any type of business considered essential to area customers.

The table below shows how many of the 3,142 U.S. counties have no employer establishments in selected industries that many consider “essential” for high quality of life. This list covers only businesses that cater to consumers, but a similar list can be developed for businesses that cater to other businesses. This table, for example, shows that there are more counties with no movie theaters than counties with no lawyers’ offices.

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Source: 2015 County Business Patterns; U.S. Census Bureau

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Where do these business desert counties exist? Are they primarily in certain areas of the United States or are they present in all states?

Many are in rural areas or in places with small populations or low population density, all areas that may not be able to support certain businesses. For example, of 344 counties with no doctor’s offices, 306 are counties with less than 10,000 people, and 105 have fewer than 2,500. Fifteen of the 344 counties are in rural areas of Alaska, and 24 are rural counties in Montana.

Similarly, of the 48 counties with no grocery store, 43 are in counties with a population of less than 10,000 and 16 have less than 1,000.

However, business deserts are not just a rural phenomenon. Of the 221 counties with no auto repair businesses, for example, 38 are counties with more than 10,000 people, including Willacy County, TX (22,002), (see below).

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Source: 2015 County Business Patterns and Census Business Builder; U.S. Census Bureau
Population data from the 2012-2016 American Community Survey 5-year Estimates

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So, how do residents of these counties make allowances for the lack of businesses and services? Sometimes, they have to travel to a neighboring county. When the county’s geographic size is small, they only have to travel a few miles, but for very large counties they might have to travel long distances to get to these businesses.

Another way residents of business desert counties get access is by turning to nonemployers. The Census Bureau not only provides information on businesses with one or more paid employees (employers), but also independent contractors and sole proprietors (nonemployers). The chart below highlights the importance of these types of businesses in key industries.

For example, while there are 2,855 counties with at least one “employer” child day care center (287 counties with none), 3,117 counties have nonemployer (home-based) child day care centers. Similarly, while there are 2,904 counties with at least one “employer” plumbing, heating and AC contractor (238 counties with none), 3,015 counties have plumbing, heating and AC independent contractors.

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Source: 2015 Nonemployer Statistics; U.S. Census Bureau

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For residents living in counties that lack certain businesses, there are options. They can get products or services from other types of businesses.

For example, while more than half of U.S. counties have no barber shops (2,400), there are only 802 counties with no beauty salon. Men in these counties probably go to the local beauty salon to get their hair cut. Similarly, gasoline and hardware are not only sold in gas stations and hardware stores, but are often also sold at other retail businesses that may be in these business desert counties. Likewise, alcoholic beverages may not only be purchased in bars (“drinking places”) but also in restaurants that may exist in counties with no bars.

Map Showing Number of Employer Beauty Salons in North Carolina Counties: 2015

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Source: 2015 County Business Patterns and Census Business Builder; U.S. Census Bureau
Population data from the 2012-2016 American Community Survey 5-year Estimates

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Finally, technology can also play a role in allowing customers in business deserts to access the products and services they need. High-speed internet (even via satellite phone) allows users to do their banking, order products, and even seek medical care from businesses hundreds and even thousands of miles away and get their products delivered to their front door.

The Census Bureau can help. Local planners and entrepreneurs can use Census Bureau business data to identify the presence of business deserts and fill the void in key industries. Planners can identify at-risk populations that would be most affected by lack of services and justify the need for federal and local financial assistance. The data also provide a tool for legislators who need to surmount legal barriers and policies that hinder their ability to address these business deserts. Finally, Census Bureau data tools (Quick Facts, OnTheMap and Census Business Builder) provide easy access to critical data that planners rely on to make key businesses and services accessible to all Americans.

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Andrew W. Hait is a Survey Statistician/Economist at the Census Bureau.

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This story was posted in: Business and Economy

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