Creating a Resilient Economy: Lessons From Natural Disasters and Global Shocks

Creating a Resilient Economy: Lessons From Natural Disasters and Global Shocks Main Photo

26 Jan 2025


News

Resilient communities are set apart by their ability to weather storms – literal or metaphorical –  and emerge on the other side maintaining or thriving. The work of economic development organizations often contributes to more resilient communities through economic diversification and the nurturing of local businesses and innovation. However, purposeful efforts to strengthen economic resiliency can create an adaptable community amid a natural disaster, pandemic, or global downturn.

Diversify Industries

Diversification is a major contributor to resiliency as it moves the local economy away from reliance on a specific business or industry for employment and tax revenue. When one industry, such as agriculture or tourism, has dominated the economic landscape, advocating for change can seem daunting. Start small with a study to identify the best industries for your EDO to target based on the workforce, infrastructure, and other assets present in the community.

The study should examine similar communities to assess growth opportunities and identify areas for improvement. For example, a mid-sized city striving to recruit tech companies and talent may determine more recreational venues are needed to meet the off-duty demands of the workforce. Use the results to strengthen your region’s appeal and create opportunities for businesses in the identified industries to relocate or build in your region.

As your local economy diversifies, it becomes more resilient. A hurricane may impact local agriculture or tourism for a sustained period while tech companies return to work in days. Similarly, a downturn in tech impacting the workforce at a local business is offset when there is also a growing manufacturing or energy base. 

Increase the Local Supply Chain

The COVID-19 pandemic demonstrated the need for long-term planning to minimize the impact of global supply chain disruptions on local economies. Resilient communities develop local supply chains by encouraging area production, recruiting general and specialty manufacturing when possible, and creating opportunities for companies to support other local businesses and the public. Investments in farmer’s markets and other trade venues make a community more self-sufficient and can help the local economy sustain itself during global shocks.

Upgrade Local Infrastructure

Maintaining and upgrading local infrastructure is a key component of resiliency for communities regularly impacted by natural disasters, such as hurricanes, severe storms, and flooding. Increasing stormwater drainage, adding pumping capacity and effectively maintaining natural drainage locations can reduce the number of critical events in an area prone to flooding. Storm-proofing power grids, burying powerlines and investing in local energy production cut the time it takes to get back online after a tropical storm or winter storm, making it easier to coordinate relief efforts and reopen businesses. 

Invest in Education

Both positive and negative shifts in the local economy place new demands on the workforce. If a business leaves town, former employees may require new skills to acquire a different role. Simultaneously, your EDO must demonstrate a skilled or adaptable workforce exists to recruit new manufacturers and businesses. Communities focused on resiliency need strong secondary schools, technical schools, and colleges ready to adapt to shifting employment opportunities in the region. 

Proactively Plan for Disasters

Weathering a storm requires many responsive actions dictated by emerging issues. Planning for worst-case scenarios in advance will help guide those actions. Developing a crisis management plan general enough to support any disaster and easily customized for specific events, creates a framework for effective response and informs decision-making in otherwise stressful situations. Municipalities and governmental agencies often address urgent needs, leaving organizations like EDOs to focus on more specific concerns, such as the needs of businesses.

Developing a more resilient community requires many partnerships, and Golden Shovel Agency is ready to join your EDO on the journey. Contact us today to learn more.