Report Says Adoption of Online Tech Could Help Rural Small Businesses Sales Grow by Over 28% During the Next Three Years

A new report by the U.S. Chamber of Commerce and commissioned by Amazon suggests that “unlocking the digital potential” of rural businesses across the U.S. could add over $140 billion to the U.S economy over the next three years and create an additional 360,000 full-time jobs in rural communities.


Current economic statistics, acccording to the report

37 million | Working-age adults who live in rural U.S.
15% | Percentage of the adult population
18 million
| Households in rural U.S.

75% | Percentage of the U.S. land mass that is rural
3.7% | Percentage of U.S. GDP generated in rural U.S.


According to the report, greater adoption of digital technology over the next three years could grow revenues of rural businesses by $84.5 billion each year (+21.0%), with states in the South realizing the greatest benefit. (See chart, below).


Online tools and technology have the highest potential impact on rural small businesses with annual revenue under $100,000, which could see sales growth surge over 28% over three years.


“We’ve seen firsthand how rural entrepreneurs can transform their businesses through digital technology, from reaching millions of new customers around the world by selling online,” said Jeff Wilke, Amazon’s Worldwide Consumer CEO. “Ensuring that small businesses in rural America have good digital skills, are able to attract tech talent, and benefit from fast connectivity will deliver increased economic prosperity in rural communities.”

“The opportunity to successfully start and grow a rural small business in our country is a great example of how technology is positively transforming nearly every aspect of our lives,” says Tim Day, senior vice president of the Chamber’s Technology Engagement Center. “Digital tools and technologies allow rural small businesses to compete in a global economy—regardless of their size or location—which is essential to a vibrant U.S. economy.”

Potential positive impact of online tools and technology on rural businesses (each year, 2019-2021)

Additional Annual Sales ($ billions)Additional Annual
Value-added ($ billions)
Additional
Jobs
Northeast$8.4$4.838,662
 New England (CT, ME, MA, NH, VT)$2.7$1.614,312
 Middle Atlantic (NY, PA)$5.7$3.324,350
Midwest$24.8$13.599,669
 East-North Central (IL, IN, MI, OH, WI)$15.7$8.564,388
 West-North Central (IA, KS, MN, MO, NE, ND, SD)$9.1$5.035,281
South$40.6$22.5171,495
 South Atlantic (FL, GA, MD, NC, SC, VA, WV)$14.6$8.267,431
 East-South Central (AL, KY, MS, TN)$13.5$7.358,127
 West-South Central (AR, LA, OK, TX)$12.5$7.045,937
West$10.7$6.150,228
 Mountain (AZ, CO, ID, MT, NV, NM, UT, WY)$5.9$3.429,454
 Pacific (AK, CA, HI, OR, WA)$4.8$2.720,773
United States$84.5$46.9360,054

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Key findings of the Report
(More findings here.)

  • Increased adoption of online tools and digital services for businesses across rural America could create more than 360,000 jobs in the next three years.
  • Increased adoption could grow annual revenues of rural small businesses by more than 21% over the next three years – the equivalent of $84.5 billion per year – with states in the South seeing the greatest benefit
  • Online tools and technology have the highest potential impact on rural small businesses with revenue under $100,000
  • One-in-five rural businesses are already digital. Nearly 20% of rural small businesses in America generate the vast majority of their revenue (at least 80%) by selling their products and services online.
  • Technology is boosting rural business revenues. Rural businesses say adoption of digital technologies are important for their future, with 55.2% of them agreeing that e-commerce helps them grow their customer base and a similar percentage (54.6%) confirming that online tools had a positive impact on their revenue in the past three years.
  • Online services help rural businesses reach customers out of state and overseas. Almost 40% of these small business owners say that digital technology has allowed them to sell beyond their state and 16% of them confirm they are selling internationally due to their access to digital tools. Thirty-three percent sell their products using their own websites, 12.7% use a third-party online sales site, and 35.7% use online marketing, including social media.
  • Digital tools and technology help purchasing and cut costs. 29% of rural businesses say that online tools reduce purchasing costs of products and materials, with 22% purchasing at least 80% of their goods and services online.

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Examples of Ways to Unlock the Digital Potential of Rural Small Businesses

Increase digital connectivity in rural areas

66% of rural small businesses say poor internet or cell phone connectivity negatively impacts their business.


Increase the talent pipeline of candidates trained in digital skills (cloud, digital marketing)

38% of rural small businesses say they can’t hire the talent with the right digital skills in their area


Increase adoption of digital training and digital tools by rural small businesses so they can scale their operations

Nearly 41% of rural small businesses agree that policymakers should create incentive programs that make it easier for rural small businesses to incorporate digital technology into their daily operations

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