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January 12, 2015

Older Workers and (Semi) Retirees: A Key Element of Rural Economic Success?

Urbanization remains a significant issue for rural areas both in Canada and around the world. In this post, I’ll briefly survey some of the factors that attract workers to rural areas, and consider the potential of older workers and late-life entrepreneurs to help drive economic growth.

Research and policy attention is increasingly focused on understanding what motivates skilled individuals and youth to (re)locate in particular areas. For rural locations, researchers have highlighted the importance of quality of life, the accessibility of nature and outdoor activities, a less stressful environment and family and community as factors that prompt individuals to (re)transition from urban to rural life. To promote these advantages and woo potential new residents, a number of municipalities have begun to provide re-location incentives and engage in aggressive place marketing strategies, such as welcome packets or direct financial incentives, to encourage urban to rural migration. More generally, rural areas are increasingly embracing strategies of ‘place branding‘ in an attempt to identify and promote their localities unique advantages.

Are Older Workers the Key for Rural Revival? 

Rural areas often experience a net outflow of youth and young professionals but also, in some cases, a corresponding net-inflow of older (50-55+) individuals, either retired or semi-retired, who are attracted to the quality of life available in small towns and rural communities. While this dynamic does not address the issue of an aging rural population, the shifting nature of the economy and retirement models for older workers provides a potential opportunity for rural areas to benefit from their skills and experience. In the context of longer life expediencies and the rise of the freelance economy, the dividing line between work and retirement grows increasingly blurred. This shift can be particularly pronounced for the type of ‘creative class‘ workers that can act as drivers of rural economic growth.

As such, it would be a mistake for rural municipalities to dismiss the economic and entrepreneurial potential of incoming older workers. Reviewing a number of existing studies, for example, indicates that older individuals are an important source of small-business start-ups in rural areas, and have a higher rate of entrepreneurial success than their younger counterparts. Since in-migration from older workers and retirees creates jobs, small towns and rural communities cannot overlook this important source of economic growth.

While potentially creating a strain on some local services, migrating older workers and (semi) retirees thus bring significant benefits to the local economy. These individuals boost demand for the products and services supplied by local businesses, bring valuable skills and experiences, and in some cases even launch new local businesses. These trends will only accelerate as a new wave of knowledge workers exit their full time careers.

To help attract and facilitate entrepreneurship among older workers and (semi) retirees, small towns and rural communities need to promote the various life-style amenities that motivate older individuals to migrate away from large urban areas. At the same time, smaller centres must focus on providing the type of digital infrastructure investments that will allow knowledge workers to operate remotely. Those jurisdictions with sufficient resources should also consider providing additional support services to older entrepreneurs. By working to attract retiring knowledge workers and creating a fertile ground for late-life entrepreneurship, smaller areas can have a positive impact of the vibrancy of the local economy and help drive economic growth, which will in turn help to attract both younger and older migrants alike.

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