How Small and Midsized Cities are Leading the Charge in Inclusive Growth and Economic Transformation
By: Mari Kate Mycek, Ph.D and Betsey Suchanic
In 2020, the United States experienced the onset the COVID-19 pandemic and a racial reckoning that brought racial justice to the forefront of a national conversation. There were drastic and immediate repercussions, and we are still understanding the long-term impact on our economy. Several years later, this is a unique moment in history and a pivotal moment for American cities, especially Small and Mid-size cities, to prioritize, pilot, and implement new inclusive economic growth strategies and activate this opportunity for radical change.
In our cities, everything from housing and transportation to policing has the imprint of long-standing and widespread policies that excluded and harmed people of color. Redlining has served as a long-standing barrier to wealth creation through homeownership, transportation policies allowed for the destruction of black neighborhoods through the development of our interstate highway system, and the spatial design of our cities has resulted in health inequities which only are poised to intensify with the looming impact of climate change. While nothing about these policies is new, since 2020, there is heightened awareness and urgency to create real, systemic change. Further supporting this urgency and awareness is a historic moment in recovery from the COVID-19 pandemic, with new economic models emerging alongside historic federal investments in economic equity and inclusive growth models.
As city leaders grapple with this legacy and reality of economic exclusion, we’ve seen new models for change emerge from a specific group of cities primed for investment and inclusive growth – small and mid-size cities. Seven hundred small and mid-size cities, with populations ranging from 50,000 to 500,000 residents, are home to over a quarter of the U.S. population. Practitioners in these cities are working creatively and diligently towards equitable change. Of the cities in the U.S. that have begun crafting reparations strategies, almost all are small and mid-sized cities and a majority of mayors advocating for guaranteed income programs represent small and mid-size cities. Small and mid-size city leaders have also been taking steps to reform municipal operations that reinforce power structures and resource allocation, including budget equity tools and procurement policies.
As city leaders grapple with this legacy and reality of economic exclusion, we’ve seen new models for change emerge from a specific group of cities primed for investment and inclusive growth – small and mid-size cities.
Many cities across the U.S. are growing, changing, and experiencing new volumes of economic investment to the degree that some call it a renaissance. However, history shows us that economic growth can often result in an unequal distribution of benefits. As we continue to grapple with the reality created by systemically racist policies and practices, we must constantly question who exactly will benefit from new growth. Rethinking our economic systems and supports is a vital component of developing an equitable economy.
At New Growth Innovation Network (NGIN) we know that radical, intentional change takes time and we need sustained, long-term commitments that center racial justice and equity. Our recently launched Small and Mid-Size City Hub is a practitioner-led community with dedicated resources to drive inclusive economic development, advance racial equity, and reduce health inequities. Launched in February, this hub builds on NGIN’s previous research on barriers to inclusive economic development in SMCs. In Small and Mid-size cities it’s paramount that we keep moving forward, and we’ve heard from practitioners that they are ready to do the work, and we are committed to help drive that change
What We’ve Heard from Small and Mid-Size Cities
Throughout 2023, NGIN has engaged 157 local economic practitioners from 72 small and mid-size cities through questionnaires, interviews, focus groups, shared building spaces, virtual events, and program applications. A few themes have risen to the surface from these early conversations, helping illustrate how SMC practitioners are thinking about and working towards inclusive growth. These include:
Historical and Structural Barriers: Local economic leaders often discussed how their city’s past informs its present. They spoke about the ongoing and often difficult process of identifying barriers, decentralizing decision-making, and having challenging and needed conversations about power. As one interviewee stated about working to create new programs that address past harms, “[it can be] difficult because the people who have experienced trauma are trying to work with the government who have not listened.” Building trust and cultivating real relationships with their communities and community-based organizations is something these practitioners hope to do more of; programs cannot be successful if they are top-down. Practitioners want to address these historical and structural barriers head-on with a system approach.
Community Wealth-Building: For economic leaders, community wealth-building directly relates to economic and community development strategies that build economies for communities to have direct ownership and control of their assets. Practitioners are taking different approaches, such as cooperative business development, guaranteed income programs, or inclusive procurement, and looking for guidance to weave them together to create a comprehensive strategy. The momentum surrounding community wealth building isn’t unique to small and mid-size cities; a recent Biden-Harris Administration announcement explicitly mentions community wealth building as a priority, further emphasizing practitioners' and policymakers' attention. Practitioners in small and mid-size cities can pilot and scale these efforts more easily than larger jurisdictions, but they need support and models to make them a reality.
Measuring Equity: Local leaders are looking for new metrics and data to help understand the impact of inclusive growth programs. Traditional economic development metrics, such as jobs created or businesses started, do not measure progress in removing structural barriers and building wealth for those with historical and current barriers. While each practitioner we spoke with highlighted Diversity, Equity, Inclusion, and racial equity efforts, many highlighted the difficulty in building measurable accountability for this work. In our recent Small and Mid-Size City Hub virtual event on this topic, only 17% of respondents felt their city had the resources to use data effectively to drive inclusive programming.
Capacity, Capacity, Capacity: The most common refrain from our discussions with practitioners was concerns about their limited capacity. Capacity continues to dictate their ability to build, start, and grow inclusive growth programs within their cities. Capacity in this context can mean insufficient time, money, resources, support, or opportunity to find, start, fund, or complete inclusive and equity programming. This wasn’t a surprise as it echoes what we learned through NGIN’s previous research and reiterates that any new program or project takes significant time, knowledge, and resources. Ultimately, this illustrates that many city practitioners are driven to build these solutions, and there is an opportunity to invest and provide the resources to allow them to create these new models. Investments and resources into capacity building for SMC practitioners need to include new resources and efforts to help practitioners embed equity into the current work and systems they already hold. Tools and support to institutionalize equity work throughout the structure of the city is pivotal to addressing capacity constraints.
How NGIN is Supporting Small and Mid-Size Cities
Donors and investors working to support Small and Mid-size cities have an opportunity to bolster practitioners during a critical period. While there is a renewed urgency for equity work, resistance towards diversity, equity, and inclusion programs and initiatives continues to persist. Determining creative and thoughtful ways of providing critical support to practitioners doing racial equity work in SMCs is pivotal to progress.
NGIN’s Small and Mid-Size City Hub continues to convene practitioners and identify key themes, strengths, and challenges. In June, we kicked off the Hub’s Economic Inclusion Incubator and the Learn, Explore, and Activate in Place (LEAP) programs with 13 cities across the country, representing diverse practitioners from community and economic development. In the Economic Inclusion Incubator, four cities will receive in-depth customized support, technical assistance, and funding across 12 months. In each of the two LEAP trips, five city delegations of community and economic leaders traveled to another small and mid-size city to study inclusive models for economic growth.
These 13 city coalitions are working closely with NGIN to collaboratively build deeper local context on their inclusive growth efforts and develop steps towards equitable economic outcomes for their city. We will be sharing more about each of the 13 participating cities in the weeks to come, including further insights from these three participating cities:
Tacoma, Washington: As a host site for one of the LEAP trips, the Small and Mid-Size City Hub will showcase several avenues and stakeholders contributing to inclusive growth in Tacoma. And as a participant in the Economic Inclusion Incubator, the Tacoma Anchor Network seeks to better understand and encourage inclusive procurement to local minority-owned businesses.
LEAP (Learn. Explore. Activate in Place). A panel titled “Small Business Support: Centering Equity and Community Wealth Creation” at Parable, a Black-owned bookstore, in Tacoma, WA.
Durham, North Carolina: In joining the LEAP trip to Richmond, Virginia, representatives from Wall Street Juniors and, Be Connected Durham , two local community based organizations, alongside city staff members, shared about their cross-sectoral partnership experiences and deepen their relationships to support their existing Community Wealth Building Initiative.
Dayton, Ohio: As a participant in the Economic Inclusion Incubator, Co-Op Dayton, alongside nine partners, including a CDFI and multiple anchor institutions, seeks to design a food and advanced manufacturing cooperative business incubator in West Dayton that is centered on a shared wealth model and increases local control of critical community assets.
These preliminary insights give us a first look into the power and potential of small and mid-size cities in advancing inclusive economic growth. As small and mid-sized cities continue to grow and change, these projects help broaden our understanding of how cities incorporate inclusive growth strategies, the barriers they face, and how practitioners are centering equity in their work.
As the hub community grows, additional opportunities and resources related to peer learning, advocacy, and capital will be forthcoming. We hope these programs and insights inform more equitable paths forward for SMC practitioners and those supporting them. To receive updates and join a nationwide community of small and mid-size city practitioners, join the NGIN Community today.
