Introduction
A third place is a neutral ground where individuals from all backgrounds are welcomed and encouraged to build connections. Coined by sociologist Ray Oldenburg in his 1989 book The Great Good Place, the term third place refers to informal gathering spaces outside of homes and workplaces where individuals come together to mingle, relax, and engage in meaningful conversations. Historically, they have played crucial roles in various cultures worldwide: fostering social ties, encouraging civic engagement, and operating as egalitarian spaces where individuals from diverse backgrounds can engage on equal footing.
Today, small businesses such as pubs, cafes, and bookstores employ the third place concept. They contribute not only to the social morale of their respective communities but also to 44% of US economic activity (Small Business Administration). Unfortunately, due to challenges posed by government regulations and the onslaught of the COVID-19 pandemic, the presence of third places is on a steady decline. Nonetheless, preserving third places is critical to maintaining social connections, increasing community resilience, and supporting the economy's prosperity. Achieving this goal requires navigating government regulations and understanding the change in social relations brought upon by the pandemic.
Small Businesses and Regulations
Unfortunately, a significant factor behind decreasing rates is government regulations that tend to prioritize the interests of big businesses. Inadvertently, they contribute to the downfall of small businesses, which are essential to creating and sustaining third places. According to a report by the World Economic Forum, approximately 99.9% of businesses in the US qualify as small businesses. As defined by the Small Business Administration (SBA), a small business is profit-oriented, contributes to the U.S. economy through the payment of taxes or the use of U.S. labor, is independently owned and operated, and does not hold a monopoly in its industry on a national scale. Here in the US, 20% of small businesses fail in their first year, 30% in their second year, and 50% by year five (Bureau Labor of Statistics). In a finding documented by Statista’s analyst J. Degenhard:
The number of small and medium-sized businesses in the United States is forecast to decrease continuously by 25.1 thousand between 2024 and 2029. After the fourteenth consecutive decreasing year, the number is estimated to reach 240.39 thousand businesses and, therefore, a new minimum in 2029.
From obtaining licenses to rules for building locations, laws create significant barriers to starting and operating small businesses. Because customers value accessibility, third places that are easily accessible are more successful in satisfying the wants and needs of their patrons, with localization being important in this regard. However, due to zoning laws, which limit where businesses can operate, many have to abandon the security of their neighborhood in pursuit of a third place. Since commercial establishments are banned in some residential areas, Americans are forced to use their cars and other public transportation to access their third places. Unfortunately, this factor is enough for many to reduce their visits to their favorite locations.
Small Businesses and The Pandemic
The COVID-19 pandemic exacerbated the difficulties faced by third places, as numerous small businesses were forced to shut their doors due to mandatory social restrictions, reduced foot traffic, and health-related concerns. Data from the US Census Small Business Pulse Survey revealed that about 50% of businesses reported a significant adverse effect from the COVID-19 pandemic, with only 15-20% of them having enough money to cover three months of operations during the mandated shutdown (National Bureau of Economic Research). The sudden loss of revenue and uncertainty of the future put further strain on many third places already struggling to stay afloat.
The closing of popular cafes and local attractions serves as a reminder of how fragile these social spaces are. Rogers Park, a diverse neighborhood located in Chicago, IL, known for an abundance of restaurants and cafes, beaches, and famous theaters, was ranked a top five neighborhood to live in the US. However, Rogers Park’s third places did not escape the pandemic unscathed. After 111 years, The New 400 Theater, the oldest movie theater in Chicago, could not bounce back after the pandemic. In a post made by the company’s official Instagram account, they reminisce about their time giving back to the Rogers Park community. The New 400 served as a base for political activism, COVID testing centers, and banquet events for local businesses and charities. To end their farewell post, they encouraged people to visit Lincoln Square’s Davis Theater, the last small neighborhood theater in Chicago, encouraging them to “eat and drink and be merry because its perpetual existence is not guaranteed.”
Fortunately, through the utilization of relief and recovery measures, federal policymakers were able to relieve the economic hardship caused by the decline of small businesses. Despite concerns of failure, existing and new small businesses have defied earlier expectations, according to a Hamilton Project analysis. By the end of 2021, almost 450,000 more establishments were operating than before the pandemic. In June 2022, the total number of jobs exceeded pre-pandemic levels, and by December 2023, there were 5 million more employment opportunities than in February 2020 (CBPP). The development of high inflation in 2021 and the adjustment of monetary policy in 2022 presented new obstacles to an ongoing economic boom. Still, by the end of 2023, the economy was experiencing high employment and declining inflation.
Call to Action
Third places are not just business endeavors; they are essential components to thriving communities. They provide social capital, foster spaces for cultural exchange, and serve as a haven from the alienating forces of the modern lifestyle. As such, the decline of these spaces diminishes the quality of life for locals and weakens the social bonds that nourish strong neighborhoods. Through support of local businesses, engagement in community affairs, and advocacy for regulatory reforms, regular customers and others can help foster an environment that contributes to the growth of third places.
Policymakers must recognize the significance of small businesses facilitating social interaction and implement initiatives and policies prioritizing their sustainability and growth. By working together, companies, consumers, and policymakers can develop a legal framework that supports the development and preservation of these priceless community spaces. By investing in third places, we contribute to the well-being and vitality of our neighborhoods, ensuring that they will continue to be thriving hubs of social interactions for generations to come.
Third places are not just business endeavors; they are essential components to thriving communities.
Conclusion
Third places are essential to communities because they offer areas for shared experiences, social interaction, and cultural exchange. However, the well-being of communities is threatened by their decline, which is worsened by legal obstacles, including zoning regulations, license requirements, and permits. The COVID-19 pandemic made the difficulties faced by third places more serious, showcasing the critical need for a coordinated response. Third place preservation and revitalization should be a top priority for individuals, groups, and policymakers nationwide; together, we can ensure these priceless spaces continue to promote community-centric values across the country.