The Benefits of Community Wealth Building
Community wealth building is a way for towns and cities to hold onto the money that moves through their streets. Rather than seeing cash swept up by big chains or sent off to distant shareholders, this approach keeps money in the hands of local people.
At its core, community wealth building puts everyday people first. It recognises that strong communities are built when jobs, services, and profits stay local. By prioritising local shops, independent businesses, and co-operatives over larger chains, towns keep more of their earnings at home.
You can think of it like tending a community garden. If each person waters their corner, the whole patch thrives. When communities invest in themselves, they get more out of every pound spent.
Main Principles of Community Wealth Building
Here are the main building blocks that make community wealth building work:
- Supporting Local Shops and Businesses: Money spent at the bakery or corner shop stays in the area. This creates reliable revenue, protects local jobs, and often improves service quality.
- Investing in Local Services: Going to a community-run post office or leisure centre strengthens local networks and means services aren’t taken away at short notice.
- Backing Small Enterprises: Encouraging growth for start-ups and family-run firms keeps storefronts filled and offers more choices on the high street.
- Encouraging Social Enterprises and Co-operatives: These types of businesses often reinvest profits into community projects, youth programmes, or upgrades for neighbourhood facilities. Profits are used for shared goals, not distant shareholders.
A Few Inspiring Case Studies
Community Wealth Builders is based in Baltimore, USA. It helps local businesses with crowdfunded, no-interest loans to succeed in an area that suffers from high unemployment.
The Handmade Bakery (Yorkshire) is now thriving, thanks to local people investing in ‘bread bonds’, which have since been paid off. Instead of receiving back money, investors received good bread in return! Today, the bakery is thriving, baking thousands of loaves each week, while staying true to its roots. And supporting the local economy.
Spacehive is a community fundraising site. These are ‘pots of money’ that can be raised for local shops and projects.
How Community Wealth Building Benefits the Area
Keeping wealth circulating locally offers real-life rewards:
- More Steady Jobs: Local businesses are more likely to hire from their own towns, offering steady work and fairer conditions than many chain outlets.
- Boosting Local Spending: People who work nearby tend to spend their wages in the area, which leads to healthier shops and services.
- Keeping Profits at Home: When local groups own their businesses, any profits stick around. This can fund new projects, fix park equipment, or bring fresh life to community events.
For example, a local indie shop not only employs local people, but the taxes go to your local council, not to some faraway place. The shopkeeper and staff likely use a local sandwich shop and pub for lunch, and the signwriter is also likely local (the big Tesco signs are not being made down the road, that’s for sure!)
The knock-on effect is a stronger sense of pride and teamwork, the sort that keeps parks busy, shops buzzing, and people looking out for each other.
Michael H Shuman is the author of the wonderful book Put Your Money Where Your Life Is.
He’s American, but his ideas could transform the world. He says the issue at present is that millions of people with savings to invest, are limited to putting them into big companies and global corporations. He believes that in the future, these funds will instead be invested in local funds to build affordable housing (not destroying the countryside to do it), food and clean energy funds.
Ways to Invest in Your Community
There is no single way to get started with local investing. Below are some of the most trusted and accessible routes for everyday people who want to make a difference:
- Community Shares: These are shares in co-operatives or community benefit societies. You buy a small stake, and your investment often supports places like local pubs, green energy, or community shops. Usually, these schemes set a minimum and maximum contribution to keep things fair and inclusive.
- Local Business Crowdfunding: Some small shops and start-ups raise money through crowdfunding platforms. In return for a small investment, you might get interest, future discounts, or shares. This is one of the simplest ways to back businesses you actually use and care about.
- Credit Unions: These member-owned financial groups pool people’s savings and lend within the local area. Depositing money in a credit union means your savings help fund neighbours’ home improvements, cars, or small business ventures instead of propping up global banks.
- Local Investment Funds: Sometimes called community development funds, these raise money to invest in a cluster of small businesses or social projects. Returns are often more modest, but you get the chance to back several ventures at once and watch your neighbourhood improve.
The Benefits of Supporting Local Businesses
Designing for Local Communities
When you spend your money with local businesses, the rewards go far beyond the immediate purchase. Every pound you invest or spend in your neighbourhood helps build a place where everyone can thrive.
This approach supports families, brings neighbours closer, and keeps towns alive with new ideas and possibilities. Below, you’ll find how backing local businesses leads to real, lasting change in your area.
Job Creation Right Where You Live
Small businesses form the backbone of local employment. When people support their local shop, bakery, or pub, they help create and keep jobs that might otherwise disappear.
- Independent shops tend to hire local staff and often pay fairer wages compared to large chains.
- These jobs stay in the area, meaning local people are less likely to have to move away for work.
Take Hebden Bridge in Yorkshire as an example. Locals rallied behind their high street retailers, driving a revival that filled once empty shops and boosted jobs for local families. More jobs in town means shorter commutes and chances for young people to stay where they grew up.
