local small business should offer local specialty, if it's doing the exact same thing as the big business but with higher overhead, then why not find something much more productive for the folks there?
small local economies that are stagnating already for decades are not great for anyone. people who live there are struggling, no upward mobility, anyone a bit more successful leaves, the usual urban rural polarization intensifies, yadda yadda.
obviously one of the big drivers of this is the completely fucked up housing policy. (which itself is driven by public safety and public transit issues.)
education is a close second. then the return to office mandates. the all the discontinuities and disincentives of the braindead wrong implementation of welfare (and other social support/payments).
the real economy deadweight loss is easily 2-3% of GDP (per year of course)