How innovation is quietly taking root in New Hampshire’s small towns

Quiet shifts rarely make headlines, yet generate lasting gains in employment, income and quality of life

For decades, rural communities across the United States, including those in New Hampshire, have experienced slower economic growth than their urban and suburban counterparts.

From the decline of traditional industries like agriculture, forestry and manufacturing to population loss and stagnant wages, these shifts have strained many of our smaller towns. The pandemic sharpened these challenges, particularly in places lacking broadband, health care infrastructure, community services and access to capital.

Despite the headwinds, a different story is unfolding in some rural New Hampshire communities: one of resilience, reinvention and the emergence of a phenomenon researchers call “quiet innovation.” These are towns that have learned how to adapt to local and global economic forces. They capitalize on opportunities by repurposing local assets, such as vacant mill buildings, and leveraging their proximity to trails and waterways. They also foster networks of entrepreneurs and entrepreneur-supporting organizations. While many people associate innovation with Silicon Valley startups and venture capital, the type of innovation driving rural communities often appears quite different, yet is no less powerful or impactful.

The misconception of rural stagnation

Traditional measures of innovation — venture capital raised, patents filed, startup density, and research and development spending — fail to capture the entrepreneurial activity and ingenuity that drive some rural economies. These urbancentric metrics overlook the subtler, practical innovations that take root in small towns: process improvements, creative financing models, cross-sector partnerships and incorporation of cultural, arts and nature-based revitalization strategies that build momentum over time.

Recent research led by Drs. Stephan Goetz and Yicheol Han, with the Northeast Regional Center for Rural Development at Penn State University, highlights the importance of “latent” or hidden innovation: incremental improvements that businesses make by learning from peers, customers or collaborators.

These quiet shifts rarely make the headlines, yet they generate lasting gains in employment, income and quality of life. During the pandemic, for instance, rural restaurants and retailers were forced to adapt quickly to restrictions. Many introduced curbside pickup, home delivery and creative uses of outdoor spaces. These innovations were not only replicated across communities but were also refined and improved over time, illustrating how small, adaptive changes can ripple outward to support broader community resilience.

What does rural innovation look like?

Innovation in rural communities isn’t typically about the next big tech breakthrough. It often takes the form of practical, locally driven solutions, whether improving small business operations or tackling pressing community challenges. Innovation in rural places is about solving problems with limited resources, adapting to changing circumstances and building on existing community strengths. Consider these common characteristics of quiet innovation in rural communities:

• Adapting technology to local needs: In response to global competition, small-town retailers in New Hampshire launched online stores to tap into new markets and found innovative ways to connect with customers using digital apps like TikTok, Toast and HubSpot CRM.

• Reskilling workers for new sectors: Workforce programs in rural Maine partnered with companies like ReVision Energy to train former paper mill workers for solar installation and remote IT support roles.

• Reimagining community assets: A shuttered school in northern New Hampshire was converted into a coworking space and child care center run by local entrepreneurs.

• New collaborative business models: Local farms and cheesemakers in Vermont co-branded their products to sell as bundled regional “taste of place” boxes.

• Creative local financing: Residents in one rural town pooled funds through a community investment trust to help reopen a shuttered Main Street café.

These innovations may be subtle, but recent studies show that they contribute significantly to jobs and local economies, even more significant than big tech innovation in rural places.

A culture of creativity and collaboration

One common thread that innovative rural towns share is a strong social fabric. They cultivate public-private partnerships, encourage civic engagement and empower local leadership. They also invest in fellow community members’ creative potential.

Consider the arts. Research from the U.S. Department of Agriculture’s Economic Research Service demonstrates that rural communities with arts organizations see higher earnings and productivity than those without. Artists bring a design orientation to communities that influences other sectors — entrepreneurship, education and tourism — and brings new energy to Main Streets. Places like Littleton, Bethlehem, Keene and Ossipee have used the arts as an anchor for downtown revitalization and for building a distinctive local identity.

Littleton cultivated a vibrant cultural and social scene that attracts younger demographics and outdoor enthusiasts who capitalize on the region’s many recreation assets. Downtown places like The Loading Dock, an arts cooperative, and Schilling Beer Co. have become popular destinations, blending creative energy with local recreation opportunities. Meanwhile, in Ossipee, the GALA Community Center secured a half-million-dollar grant to foster the arts, workforce development and entrepreneurship initiatives to strengthen the region’s economy.

Similarly, the Bethlehem Redevelopment Authority received funding to enhance energy efficiency at the historic Colonial Theater, helping to ensure that the venue remains a key attraction. These investments underscore a broader commitment across the region to support cultural vibrancy and economic resilience through the arts.

Other communities have found success by activating natural assets.

Franklin is leveraging its location at the confluence of three rivers to build a whitewater park called Mill City Park, expected to generate millions in new economic activity.

“The river was already a destination on its own; we simply built upon that,” said Marty Parichand, founder and executive director of Mill City Park. Franklin is not only harnessing its abundant recreational assets to drive economic growth, but it is also using innovative financing tools to support redevelopment. The city has made strategic use of the state’s Community Revitalization Tax Relief Incentive (known as 79E) to attract investment and revitalize key properties.

A prime example is the transformation of the historic Stevens Mill by Chinburg Properties into 147 market-rate apartments and commercial space. The project was made possible through more than $25 million in financing from local banks, state agencies and other financial institutions.

These are just a couple of examples highlighting a broader shift from passive decline to a proactive reimagining of local assets. Rural leaders are not waiting for external investment or policies. They are relying on local sweat equity and partnerships to shape their futures.

Why it matters now

In today’s economy, agility and innovation are just as critical in Bethlehem as they are in Boston and Cambridge. As more people seek the lifestyle, affordability and social connections that rural communities offer, there is an opportunity to reframe rural America not as places left behind but as sources of resilience. Communities don’t need to start from scratch. Many already have the ingredients of an innovation ecosystem: motivated leaders, engaged residents, active anchor institutions and a willingness to collaborate across sectors. What they need is recognition, coordination and tools to scale what works.

Innovation is taking root in rural NH

Innovation doesn’t only emerge from co-working spaces or R&D labs.

It shows up in a small-town bakery that streamlines ordering through an app. It lives in a volunteer-led initiative to turn vacant lots into pop-up shops. It thrives when entrepreneurs, artists, educators, and civic leaders say, “Let’s try something new.” Rural New Hampshire is full of such people, and if we pay closer attention to their efforts, we will learn what works and recognize that innovation is not just possible in small towns. It is already happening.

Charlie French leads UNH Extension’s Community and Economic Development Department, which supports downtown revitalization and local economic development. He is the author and editor of “Building Rural Resilience Through Innovation and Entrepreneurship,” published by Routledge in 2022. His research and teaching focus on cultivating entrepreneurial ecosystems. Charlie holds degrees from Dartmouth College, Western Illinois University, and the University of New Hampshire.