Migration and Microbusinesses: A Recipe for Economic Growth

As the world becomes increasingly interconnected, the movement of people from one place to another has a significant impact on local economies. This is particularly true when it comes to the growth and density of microbusinesses, as highlighted in the GoDaddy Venture Forward 2024 Annual Report. Let's delve into the fascinating relationship between migration and microbusinesses, and explore the economic implications of increased microbusiness density.

Migration and Microbusiness Density: A Strong Correlation

GoDaddy's research reveals a clear correlation between migration and microbusiness density. Counties with higher migration rates tend to have a greater concentration of microbusinesses. This relationship holds true regardless of whether the new residents moved from another county, state, or country. In fact, the greater the distance moved, the more significant the impact on microbusiness density.

* Residents who moved from another county, same state: For every 1% increase in the population who lived in a different county a year ago, there is a.03 increase in microbusinesses per 100 people. This effect is only significant when subset to counties with less than 15 microbusinesses per 10 people.
* Residents who moved from another state: For every 1% increase in the population who lived in a different state a year ago, there is a.09 increase in microbusinesses per 100 people.
* Residents who moved from another country: For every 1% increase in the population who lived in a different country a year ago, there is a.42 increase in microbusinesses per 100 people.

The Role of Key Factors in Microbusiness Growth

Broadband access, race, industry employment figures, age cohorts, and education levels were controlled for in the regression model that analyzed the correlation between migration and microbusiness density. The model generated an R-squared of.59, indicating that these variables accounted for a significant portion of the variance in the data. Specifically, broadband access, which enables online microbusinesses, was likely a key factor in the correlation. Race, industry employment figures, age cohorts, and education levels may also have played a role, as they can influence the likelihood of entrepreneurship and migration. However, the greater the distance moved, the greater the impact on microbusiness density, suggesting that migration itself was the primary driver of the correlation.

Economic Implications of Increased Microbusiness Density

Increased microbusiness density can drive up household median incomes, lower unemployment, and create new jobs. According to GoDaddy's Venture Forward research, each additional microbusiness per 100 people in a county can decrease the unemployment rate by.11 percentage points. Moreover, over seven new jobs are created by each microbusiness entrepreneur on a county-level, demonstrating their significant impact on local economies.

In conclusion, the migration of residents significantly impacts the growth and density of microbusinesses in a county. As new residents bring fresh ideas, skills, and resources, they contribute to the local economy and foster an environment conducive to entrepreneurship. By understanding and harnessing this relationship, policymakers and investors can make informed decisions to support economic growth and job creation.