Local Employment Impacts of Connectivity to Regional Economies: The Role of Industry Clusters in Bridging the Urban-Rural Divide

Abstract

This article proposes a new economic development framework – regional economic connectivity – to address the deep and growing urban-rural divide. Regional economic connectivity calls attention to the benefits to local communities of fostering connectivity to industry clusters and economic specializations that are already present in their broader regions. This analysis examines the relationship between growth and connectivity across all U.S. counties and their regions from 2010 to 2016 and finds that local cluster employment grows faster when those jobs are part of regional clusters. The magnitude of the relationship between growth and connectivity varies across the urban-rural hierarchy, with particularly strong results for micropolitan communities. A targeted analysis of Virginia is presented to illustrate these trends and implications for practice.