Bridging the Urban-Rural Economic Divide

March 27, 2018

National League of Cities

Bridging the Urban-Rural Economic Divide, a new report released March 12, 2018, by National League of Cities (NLC) in partnership with the state municipal leagues, challenges conventional thinking about the urban-rural divide and encourages stronger links between urban and rural areas to spur economic growth.

The report’s findings echo the call-to-action of NLC’s national Rebuild With Us campaign calling for federal-local partnerships to invest in interconnected infrastructure networks — such as broadband — to support a modern economy.

In addition to confirming rural broadband challenges, the new analysis reveals surprising rural strengths in the growth of traded-sector businesses and rural contributions to overall state economic expansion.

Specifically, the report finds:

  • In all states, urban areas outpace their rural counterparts in broadband access. States with overall higher levels of broadband access also have more significant urban-rural digital divides, underscoring the importance of extending affordable broadband to rural areas.
  • States with strong levels of educational attainment have less conspicuous educational divides between urban and rural areas. Often, rural areas are home to universities, which connect rural residents to educational opportunities and narrow the gap.
  • Although urban areas have somewhat stronger rates of high-value business growth (growth of establishments in exporting industry sectors), rural areas don’t appear disadvantaged in this characteristic. In fact, many rural areas outpace their urban counterparts in creating high-value businesses.
  • Most states do not have significant urban-rural divides in prosperity growth, defined as their per capita contributions to state GDP (gross domestic product). Both urban and rural areas contribute to states’ economies.

These nuanced findings show the complexities of the urban-rural divide. One consistent theme, however, is the importance of infrastructure connectivity and market access, indicating that sustainable growth hinges on the connectedness of places, not necessarily their designation as urban or rural.

To improve economic outcomes, the report encourages states, regions and cities to generate new drivers of economic growth by strengthening value chains, market access and other economic relationships between urban and rural areas. These approaches not only provide a new perspective on strategies for rural and distressed communities, but shifts the narrative from urban vs. rural to a shared economic future.

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