The fact that chain businesses are detrimental to a small town’s economics goes unnoticed by few. But even fewer are those who understand why or how a Starbucks buying out a mom-and-pop café affects local economy.
For example, when Dunkin Donuts bought the lot across from Doc’s Café, it was wondered if the development of the area would bring prosperity or ruin. The placement of the local café and the national chain presents a question of how Westport’s money can impact the local economy—for better or for worse.
Job creation is one of the most prevalent issues the community must deal with during the current economic hardship. About 9.5 percent of Americans are currently unemployed, the blame for which has been partially placed on the shoulders of big business. When big business moves in, it often buys out smaller, local competition, and at the same time buys out existing jobs.
Encroaching businesses will create jobs, but the overwhelming majority of those jobs will be at a lower level, with little opportunity for advancement. Along with few opportunities for advancement comes a higher propensity to turnover employees when the national company is at stake.
According to Jeff Milchen, an advocate for independent business, the profits of America’s 500 largest corporations grew “700 percent in the past 20 years,” but those corporations tended to fire more people than they hired. In comparison, local businesses created 70 percent more jobs, according to a 2007 San Francisco study. In effect, local business benefits the local job market more than chain business.
Bringing in a big business to replace an independent business changes the economic atmosphere in the town. If the area’s largest employer is a national chain that is faring poorly, that translates to the area’s employees faring poorly as well. Less dependence on large business correlates to more independence for the community.
Dependence on a national business is not only more risky for the small town, but also affects its character. Many small, local businesses offer diversity in choices that cater to the whims of the town. A large, national chain will cater to the whims of the country overall, decreasing diversity of options for the region.
Consider a town of bibliophiles with a number of bookstores—one that caters to philosophy, one to modern fiction, one to cookbooks, etc. Maybe one bookstore has a special section for regional authors. A major chain bookstore is able to offer only the national preference for books—it is not able to cater to the town.
Lori Cochran-Dougall, director of the Westport Farmer’s Market, reinforced this point. “When you spend your money you place a vote. When placing a vote, you reinforce the type of environment you want in your community, ” she said.
