Hartsfield-Jackson International Airport, the heart of Atlanta’s logistics industry, is a fair-weather friend to the region’s economy.
When times are good, it’s an oversize driver of jobs and salaries. When there’s a slowdown, it can create an out-sized drag.
The airport accounts for 63,000 jobs directly and 100,000 from related services and businesses.
There’s a danger when jobs are concentrated in too few industries in a metro area, says a recent report assessing the diversity of U.S. metro economies.
Metropolitan regions with less economic diversity suffer more during economic downturns, said Josh Wright, a vice president at Emsi, the Idaho data analysis firm that created the report.
Metro areas or states that recognize and shore up weaknesses can save themselves future pain, Wright said. Among 382 metro areas, Atlanta ranked 285th for economic diversity.
The Emsi report, based on Bureau of Labor Statistics and other data, shows that Atlanta has a comparative shortage of jobs in some industries such as health care and engineering-intensive manufacturing.
The local economy is top-heavy in logistics, the report points out.
“Most metro areas have about 8 percent (of jobs) in distributive services. Atlanta has about 12 (percent),” Wright said.
Distributive services include the airport and everything from transit to trucking, warehousing, wholesalers and power and telecommunications services. When bad times hit, fewer people fly or ship goods. As the Great Recession's effects ramped up, for instance, Hartsfield-Jackson traffic dropped by 5 percent in mid 2009. That doesn't sound bad, but if the same thing happened today, the impact would be great.
But the airport adds $35 billion a year in direct revenue to the region, according to a 2018 report to the city by its aviation manager. If that 5 percent drop were to trickle down in a downturn, it would take a direct $1.75 billion bite out of metro Atlanta’s economy.
One of former-Gov. Nathan Deal’s legacies is the state’s successful business recruiting program, but the Georgia Department of Economic Development has not studied the industry diversity issue, according to a spokeswoman. She directed The Atlanta Journal-Constitution to the Metro Atlanta Chamber of Commerce’s Economic Development Department, which is taking a key role in recruiting new businesses.
The Metro Atlanta’s Chamber of Commerce, which was unaware of the report, had already targeted health care for growth.
“We kept hearing we are a Mecca for global health,” said Chief Economic Development Officer David Hartnett.
Atlanta is home to a cluster of hospitals and health agencies such as The Task Force for Global Health, the American Cancer Society and the Centers for Disease Control and Prevention and The Carter Center. Some local health leaders have made forays into establishing Atlanta as an international health business and nonprofit center.
The Chamber wants to position Atlanta as a center for disaster response and disease elimination, and to create a central location where all the Atlanta and Georgia health businesses and nonprofits have a physical presence. It pulled together dozens of those agencies in meetings to connect them, which led to plans for an international global health conference in Atlanta in June 2020. The Chamber will build on that to attract more like businesses.
“That’s a new cluster for us,” he said.
The Chamber is also focusing on recruiting advanced manufacturing, which would address the shortfall in engineering-intensive manufacturing. Its other areas of recruitment include bio-sciences, creative services such a gaming and filming and high tech areas including robotics, artificial intelligence and virtual reality.
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