'Silver tsunami’ hitting rural America as small business owners retire without replacements (2024)

Many small businesses owners are planning on retiring soon, but finding buyers to keep the businesses going can be a challenge, especially in rural areas.

'Silver tsunami’ hitting rural America as small business owners retire without replacements (1)

By Brian Beach
Harvest Public Media

The town of Stratton, Nebraska, used to have two grocery stores, two barber shops and a pharmacist.

But today, most of those businesses are long gone.

Late last year the town’s lone lumberyard and hardware store closed, too, adding to the empty buildings in town.

Owner Denis League, who is in his late 60s, spent a year trying to find a buyer. Yet none of the interested buyers could make the finances work in the tiny western Nebraska community.

“You’re dealing with a pretty small base and we’re just not getting enough business here to make it interesting to anybody else, as far as anybody else wanting to buy it,” League said.

Without League Builders Supply, customers now have to drive more than an hour and a half away to the nearest lumberyard.

“The people that have been coming here are just going to have to go somewhere else,” League said. “But a lot of people have gotten used to not coming here anyway.”

More than half of business owners are 55 years or older, according to the U.S. Census Bureau’s Annual Business Survey. With the youngest Baby Boomers set to reach retirement age in 2030, it’s clear small business ownership will undergo a major transition. The Exit Planning Institute found in a recent study that 75% of business owners would like to exit their businesses within the next 10 years.

“There's a silver tsunami coming,” said Renee Wiatt, a research specialist with the North Central Regional Center for Rural Development at Purdue University. “There’s basically going to be this mass exodus of that baby boomer age who are going to all be retiring in the next five to 10 years.”

That wave is likely to hit rural areas especially hard.

'Silver tsunami’ hitting rural America as small business owners retire without replacements (2)

Shrinking rural populations

The village of Stratton had a population of more than 600 in 1950.

Today, it’s less than half that.

Many other towns across the rural Great Plains and the Midwest have experienced similar losses.

Young people migrating to larger cities and leaving behind aging populations are contributing to the decline, according to Ness Sandoval, a sociology professor at Saint Louis University.

“In rural areas, you tend to see more people dying than are born,” he said. “That has to do with the brain drain — young people leaving and going to college, and not necessarily coming back home.”

Sandoval knows firsthand.

He grew up in Scottsbluff, Nebraska, a town of nearly 15,000 people in the state’s western panhandle.

He said things have changed since he was a kid, as most businesses in the smaller towns have closed due to competition from larger retailers.

“All these small businesses that surrounded Scottsbluff essentially are dead because they can't compete with a Walmart, they can't compete with Home Depot,” he said. “The margins are just too small.”

Sandoval said he is concerned about the future of many rural small towns as the older generation retires without young people to replace them.

“Once these Baby Boomers die and my generation, the Gen Xers die, I don’t see a lot of people moving there because they’re not the same type of communities that existed 20, 25 years ago,” he said.

Yet Wiatt of the North Central Regional Center for Rural Development said the wave of retirements could also bring opportunities, as well.

“Most businesses fail within the first five years from when they're started,” she said. “So, if there was an opportunity like that, to come into a business that’s established and try to run it, I think it's a great opportunity for these younger individuals to take some charge there,” she said.

At Advance Iowa, an organization that helps businesses with ownership succession planning, Program Manager Stacy Mullinex said there are three primary questions that need to be asked when a business owner is looking to sell their business: when they want to see, what the value of the business is and who they are going to sell to.

Mullinex said the third question is where more business owners struggle.

But through Advance Iowa, Mullinex focuses on an employee ownership model where existing business employees can be trained to own the operation.

“A lot of times, the people that already know the business really well, that already are vested in the community, they already know the consumers and they know how the business operates and runs, that’s the employees,” Mullinex said.

She advocates for the worker cooperative model, where the owner sells the business to employees and then the workers own it as a group. “It’s kind of a win-win-win of opportunity for everybody,” she said.

Mullinex said the owner wins because they are provided with a feasible buyer, the employees win through increased wealth and job satisfaction through ownership, and the local community wins by keeping a business in town.

However, for businesses with no employees to sell to, Wiatt said many business owners are working further into old age to keep their operations running.

“The retirement age is being pushed back for a lot of these farms and small businesses and family businesses,” she said. “I think it's just getting harder and harder to quit.”

Working longer

In the southeast Kansas town of Moran, population 466, Marilyn Logan is adamant that she does not plan on retiring soon.

Logan, who is nearing 80 years old, is the part-owner and manager of Marmaton Market, the town’s lone grocery store.

“I'm going to be here until they wheel me out to the ambulance in my chair,” she said.

However, Logan is looking to hire someone to help her manage the grocery store and lighten her current workload of 60-to-80-hour weeks. That process hasn’t been easy.

“We need younger people, but we need younger people with skills,” she said. “We don't have people in the town that are young enough to work that have the skills to work, and they're not interested in learning.”

Most young people with skills, Logan said, move to larger cities where they can earn more money.

“It’s hard to find somebody with the passion to stay in a small town and work at a lower wage to make a business succeed,” she said. “It’s also tough on them to stay here too, because there’s not a lot of things for them.”

At Vitale’s Italian Restaurant and Pizzeria in Macomb, Illinois, Julie Dienst said her 86-year-old mother still comes to the restaurant each day to make the pizza sauce.

“She is really a driving force behind the restaurant too, so it’s a passion for her,” Dienst said.

The family has been running the restaurant since 1980, and while her mother is dedicated, Dienst said she’s ready to retire, along with Dienst’s older brother.

'Silver tsunami’ hitting rural America as small business owners retire without replacements (3)

Two years ago, the family put the restaurant on the market. But Macomb, the home of Western Illinois University, has lost a quarter of its population and is facing a declining university enrollment.

Dienst said that’s made it a challenging market.

“There are already several restaurants that are empty, so having one more restaurant for sale, even though we're not closed like these other places, it's just more competition, I guess,” she said.

Dienst’s father came from Brooklyn to buy a pizzeria in a town with more room to expand. Since then, she said the family restaurant has seen generations of customers come through their doors.

“I’m waiting on the grandchildren of people I waited on when I was in high school,” she said. “It’s really hard to put on a price on that.”

This story was produced in partnership withHarvest Public Media,a collaboration of public media newsrooms in the Midwest. It reports on food systems, agriculture and rural issues.

'Silver tsunami’ hitting rural America as small business owners retire without replacements (2024)
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