Biz trends

The St. Louis branch of the Federal Reserve released a study examining how neighborhood characteristics affect business location decisions between 1998 and 2002. They looked at how factors such as education, crime, taxation and population in 15,000 zip codes in 361 metro areas across the U.S.

For the most part their findings support common sense; zip codes with low crime, low density rates and populated by young, educated people earning a good living showed the fastest growth. Areas which focused spending on infrastructure and education did better than those that spend a lot on housing and community development.

Different industries responded differently. Service and information-oriented businesses were not averse to density but warehousing and whole trade stayed out. Retail and construction were highly averse to crime, but warehousing and utilities were, unsurprisingly, undeterred. Warehousing, wholesale and manufacturing sought out areas with lower education, while tech and information companies sought out areas with high education rate.

The study examined the four major metro areas served by the St. Louis Fed; Memphis, Louisville, Little Rock, and our own St. Louis.

In St. Louis the study found that, while there was a decrease in the center of the metro area, the greatest decrease in businesses occurred in a semi-circle following interstate 270 as it wraps around the area from interstate 55 in the south to highway 367 in the north. The greatest increase occurred in a band further out; from O'Fallon in the north to Eureka in the south.

The shift in growth from the suburbs to the exurbs isn't new, but its interesting to see the numbers.