How High-Speed Internet Impacts Economic Growth in Small Towns

Date: 10/14/2026 9:00:00 AM

For decades, economic development in small towns was often measured by the arrival of a new factory, the expansion of a main street business or the construction of a new highway. Today, another type of infrastructure is playing an increasingly important role: reliable, high-speed internet.

For small towns, broadband is no longer simply a convenience for residents. It is infrastructure that connects businesses to customers, workers to employers, students to education and communities to the broader economy.

The benefits of the internet extend well beyond being able to stream a movie or send an email. Reliable connectivity can create opportunities for entrepreneurship, remote work, education, health care, agriculture and business development.

The U.S. Department of Agriculture has described high-speed internet as fundamental to economic activity, particularly in rural America, noting that connectivity can support economic development, job growth, entrepreneurship and productivity.

Small businesses can reach beyond their local market
One of the biggest advantages of high-speed internet is that geography becomes less limiting.

A small-town business can use the internet to sell products outside its community, market services to customers across the state or communicate with suppliers and customers around the country.

That matters because small businesses are often the backbone of a local economy. A retailer, contractor, professional services firm, farm operation or specialty manufacturer can use digital tools to compete for customers who may never walk through its physical doors.

The National Telecommunications and Information Administration has highlighted broadband's role in giving small businesses greater opportunities to reach customers and participate in the broader digital economy.

In other words, connectivity can help a business in a town of 2,000 compete in a marketplace much larger than 2,000 people.

Broadband can support entrepreneurship

The impact of internet access is particularly significant for entrepreneurs.

Starting a business in a small town has traditionally meant overcoming a limited customer base. Digital commerce can change that equation.

A photographer can market services online. A craft producer can sell nationally. A consultant can work with clients hundreds of miles away. A farmer can use connected technology to monitor operations and access markets. A home-based business can reach customers without opening a storefront.

USDA research has found that rural communities with greater broadband access experienced greater economic growth. The agency has also identified broadband as an important catalyst for rural entrepreneurship because it gives rural businesses access to digital marketplaces.
That means broadband isn't simply supporting existing businesses. It can expand the types of businesses that are possible in a small community.

Remote work expands the local workforce

High-speed internet also changes where people can work.

A resident of a small town may be able to work for a company located in another city, state or even country without moving away. That can create an important economic ripple effect.

When people can earn income without leaving their community, some of that income can remain local. Workers may spend money at local restaurants, retailers, service providers and other businesses.

Broadband can also make a community more attractive to workers who value a small-town lifestyle but need access to modern employment opportunities.

NTIA notes that broadband expands job-search capabilities and can improve access to education and training, while community-wide connectivity can also improve access to telehealth and increase work time and productivity.

For small towns trying to retain younger residents and attract working-age families, that can be an important consideration.

Connectivity can make communities more attractive to businesses

Companies evaluating where to locate or expand increasingly look beyond traditional infrastructure.

Roads, utilities and workforce availability still matter. But reliable broadband is also part of the infrastructure businesses need to operate.

A manufacturer needs reliable communications. A professional services company needs cloud applications and video conferencing. A retailer needs payment systems and digital marketing. A farm may rely on connected equipment and precision agriculture.

USDA specifically identifies high-speed connectivity as important across industries including agriculture, manufacturing, mining and forestry.

That makes broadband a potential economic-development asset.

A community that can demonstrate reliable connectivity may be better positioned to compete for businesses that depend on digital infrastructure.

Education creates a stronger workforce

Economic growth depends on people as much as infrastructure.

Students need reliable internet to complete homework, research colleges and careers, participate in online learning and develop digital skills. Adults need connectivity to pursue professional certifications, college courses and workforce training.

NTIA identifies high-speed internet as important to education and workforce development and notes that improved connectivity can make communities more attractive to employers and skilled workers.

This creates a long-term economic benefit.

The student using broadband to complete an assignment today may become the skilled worker, entrepreneur or business owner a community needs tomorrow.

Telehealth can strengthen rural communities

The economic value of broadband isn't limited to businesses.

Access to health care also affects whether people can live, work and remain in a community.

For residents in rural areas, telehealth can reduce the need to travel long distances for certain appointments and services. NTIA has noted that community broadband can improve access to telehealth and potentially increase work time and productivity.

Better access to health care can contribute to quality of life while reducing some of the geographic barriers associated with living in rural communities.

Agriculture is becoming increasingly connected

For agricultural communities, reliable internet can support an increasingly technology-driven industry.

Connected equipment, precision agriculture, monitoring systems, weather information, digital marketplaces and other technologies can help farmers make decisions and manage operations.

USDA identifies broadband as an important component of modern agricultural technology and estimates that internet-connected precision agriculture has significant potential economic value for the U.S. agricultural sector.

For small towns surrounded by farms and agricultural businesses, that makes broadband part of the infrastructure supporting one of the community's most important economic sectors.

The economic impact can extend beyond the individual customer

One of the most important things to understand about broadband is that its economic effects can ripple through an entire community.

A new fiber connection may begin with one household or business. But the potential benefits can extend further.

A connected business may hire employees. Those employees spend money locally. A student may gain skills through online education. A remote worker may continue living in the community. A farmer may use connected technology to improve operations. A health care patient may avoid a long trip for an appointment.

These individual effects can add up.

An independent study commissioned by NTIA found that communities receiving broadband infrastructure through the federal Broadband Technology Opportunities Program experienced greater broadband availability and were estimated to generate between $5.17 billion and $21 billion in additional annual economic activity. The study also estimated that the infrastructure could support more than 22,000 long-term jobs and more than $1 billion in additional household income annually.

Those figures represent a national broadband investment program rather than a prediction for any individual town. But they illustrate the potential scale of broadband's economic ripple effects.

Broadband can support population growth and business formation

Research reviewed by the Brookings Institution has found associations between broadband expansion and higher property values, job and population growth, new business formation and lower unemployment, particularly when broadband access is combined with digital skills, online education and job-search opportunities.

That last point is important.

Broadband alone does not create a thriving economy.

Communities also need strong schools, available housing, workforce development, business support, health care, transportation and other infrastructure.

But reliable internet can make those assets more useful by connecting residents and businesses to opportunities that might otherwise be out of reach.

Fiber can provide a foundation for future growth

As communities think about economic development, the question isn't only whether residents can get online today. It is whether the infrastructure can support what residents and businesses will need tomorrow.

Cloud computing, artificial intelligence, telehealth, remote work, connected agriculture, online education and increasingly sophisticated business applications all depend on reliable connectivity.

That is why broadband infrastructure decisions have long-term implications.

NTIA's recent work on measuring broadband's economic impact emphasizes that the results of broadband investment vary based on factors such as a community's existing industries, workforce skills, geographic location and the quality and reliability of the broadband being deployed.

For small towns, that means connectivity should be viewed as one component of a broader economic-development strategy rather than a standalone solution.

Measuring the impact of connectivity

Communities can also begin thinking about broadband in measurable economic terms.
Potential indicators include:

• New businesses formed
• Existing businesses expanded
• Jobs created or retained
• Remote workers living in the community
• Growth in business applications
• Use of telehealth services
• Participation in online education and workforce training
• Agricultural technology adoption
• Business investment
• Population and household growth

Tracking these outcomes can help local leaders understand how connectivity is contributing to the community's broader economic goals.

Connectivity is economic infrastructure

The internet impact on economy is ultimately about opportunity.

High-speed internet can help a small-town business reach new customers. It can give a student access to educational resources. It can allow a resident to work for an employer hundreds of miles away. It can connect farmers to new technologies and markets. It can make health care more accessible and help communities compete for new businesses.

None of those benefits happens automatically. Broadband works best when it is paired with adoption, digital skills, education, workforce development and thoughtful economic-development strategies.

But the evidence increasingly supports a simple conclusion: reliable broadband is much more than a household utility.

For small towns, it can be part of the infrastructure that makes economic growth possible. And as communities compete for businesses, workers, entrepreneurs and families, the question may no longer be whether high-speed internet matters.

It may be whether a community can afford to be without it.