With Broadband Access Expanding Nationally, Milken Institute Best Performing Cities and Microbusiness Activity Report Looks at the Keys to Support Local Business Growth

From Lubbock to Lincoln, Detroit to Daytona, City Leaders Can Help Entrepreneurs Succeed

According to the Milken Institute’s Best Performing Cities and Microbusiness Activity report, expanding broadband infrastructure can have a pivotal role in promoting economic opportunities and unleashing entrepreneurial potential within local economies by, among other things, increasing electronic payment processing and the ability to set-up online businesses. With more than $65 billion slated to bring broadband access to millions more Americans via the Infrastructure Investment and Jobs Act, the time is ripe for individuals and communities to reimagine their futures.

“Broadband infrastructure can lead to economic opportunities, including diversifying economies and addressing skill gaps by modernizing the workforce,” said Charlotte Kesteven, Senior Policy Analyst at the Center for Regional Economics at the Milken Institute and co-author of the report. “The findings can help policymakers and local leaders better understand economic trends and better design programs with the circumstances of their unique economies in mind.”

Lubbock, Texas; Lincoln, Nebraska; Spokane, Washington; and the Dayton Beach, Florida area are the cities identified as “High Rank and Rising” in a report that also identifies those cities which are “High Rank and Falling,” “Low Rank and Rising,” and “Low Rank and Falling.” The report looks at the supports that small business entrepreneurs might need to be successful, including:

  • Expanding business support to aid is setting up an online presence
  • Streamlining licensing and permitting procedures
  • Provide technical assistance to ensure new businesses survive long term
  • Expanding access to capital
  • Increasing affordable housing

This report combines results from the Best-Performing Cities 2022 (BPC) index and GoDaddy’s Microbusiness Activity Index (MAI), examining what may be happening in the economies of a selection of cities in the two rankings. Essentially, the report looks at the impact microbusinesses may have on the economies and how that activity may be captured in BPC, ultimately better understanding what is happening in these local economies.

Notable Findings:

Cities highlighted in the “High Rank and Rising” segment were Lubbock, Texas; Spokane–Spokane Valley, Washington; Deltona– Daytona Beach–Ormond Beach, Florida; and Lincoln, Nebraska. Cities within this quartile shared high rankings in four key categories: one-year and five-year jobs growth, one-year wage growth, and broadband access. However, these cities shared relatively moderate rankings in high-tech concentration, LQ count (number of high-tech industries), and housing affordability. On the MAI, cities in this quadrant scored higher than the national average in participation and infrastructure but lower in engagement.

While these cities showed higher than-average infrastructure scores, which measure human capital and digital infrastructure access, they did not translate into a high BPC score in high-tech concentration or LQ count. These cities have the digital infrastructure to support high-tech industry but have not yet capitalized on that opportunity.

The “High Rank and Falling” segment looks at cities that are currently in the top tier of cities in BPC but that had significant drops in the rankings. The cities analyzed here are Atlanta–Sandy Springs–Roswell, Georgia, and Nashville–Davidson–Murfreesboro–Franklin, Tennessee. Microbusinesses in this segment’s cities reported a higher need for help in effectively getting their business online than businesses from other city segments. They are also more likely to report needing help accessing capital: Half of the microbusinesses indicated this to be one of the most important actions local governments can take to help them.

The “Low Rank and Rising” cities that ranked low in BPC but made significant upward strides between 2021 and 2022 include Detroit-Dearborn-Livonia, MI, Akron, OH and Columbus, GA/AL. Policies that help cities modernize their economy, with both physical infrastructure and workforce development, are key to driving a region’s success.

The “Low Rank and Falling” cities described in this section were in the bottom quadrant for BPC ranking and had a large negative change between 2021 and 2022. The cities analyzed are Pittsburgh, Pennsylvania; Tulsa, Oklahoma; Baton Rouge, Louisiana; and Asheville, North Carolina. Microbusinesses from cities in this category are twice as likely to identify licensing/permit processes as the biggest challenge when starting operations: one in five falls into this category compared to roughly 10 percent everywhere else. This suggests an important role local and state governments can have in cutting red tape and making it easier for microbusinesses to get going.

The Milken Institute’s Best Performing Cities and Microbusiness Activity report is authored by Charlotte Kesteven, Abraham Song, PhD. and Caroline Choi.

About the Milken Institute Center for Regional Economics

The Milken Institute Center for Regional Economics produces research, programs, and events designed to inform and activate innovative economic and policy solutions to drive job creation and industry expansion.

About the Milken Institute

The Milken Institute is a nonprofit, nonpartisan think tank focused on accelerating measurable progress on the path to a meaningful life. With a focus on financial, physical, mental, and environmental health, we bring together the best ideas and innovative resourcing to develop blueprints for tackling some of our most critical global issues through the lens of what’s pressing now and what’s coming next. For more information, visit www.milkeninstitute.org.


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