War in Ukraine. COVID-19 variant BA.5. Rising interest rates. High fuel costs. Soaring food prices. West coast supply chain failures. Chinese economic and banking crisis. Taiwan. Political races across the country. A disconnect between Washington policies and small businesses.
Exceptional-level droughts around the world. Labor shortages. High home prices coupled with a lack of workforce housing.
It’s all enough to keep anyone awake at night. All these issues, and a dozen others, are leading most economists to declare some level of economic recession likely in the next 18 months.
Credit: contributed
Credit: contributed
Further evidence that Washington policies do not support true economic mobility and growth? An analysis by the National Association of Manufacturers notes that the new Schumer-Manchin tax, in 2023 alone, will reduce real GDP by $68.5 billion and cut American incomes by $17.1 billion.
It’s no wonder that U.S. gross domestic product projections have been slashed by most organizations. It is likely, according to most economists, that America will follow the world into a significant economic downturn.
But here in Georgia things look much brighter.
According to Merchant Maverick research, Georgia ranks in the top 15 states that will minimize the economic impact of the recession. More good news comes from the U.S. Commerce Department’s Bureau of Economic Analysis. Their first-quarter state-by-state GDP figures show that Georgia had the 6th-best performing economy in the country, outpacing every other Southern state, including Florida and Texas. Georgia is also in the top 10 states for strong rainy-day funds in state budgets.
The Peach State’s outlook is rosier than most of the country because of key decisions made over the last decade. First, we grew our economy and diversified our industry mix after the great recession of 2007.
Over the last four years, Gov. Brian Kemp has reduced regulations and boosted the state’s reserves while keeping the state open during COVID-19. This allowed companies to continue to operate and grow and sent a message that our state was a safe place for corporate investments. The Georgia Department of Economic Development has recorded 4 years of record growth, announcing over 119,963 new jobs, $42.9 billion in new investment from over 1,281 projects and a record 412 entertainment productions filmed in the state. Some 77% of those are in rural communities, further strengthening economic opportunities no matter where you live and firmly cementing Georgia as the innovative leader for the next generation of e-mobility.
Equally important to our recovery and standing is a pro-job, pro-community focused General Assembly led by House Speaker David Ralston and Lt. Gov. Geoff Duncan. In the last few years, they’ve passed legislation addressing labor shortages, public safety, infrastructure, healthcare and rural broadband by taking a responsible and accountable approach to government.
Georgia’s coordinated state business network is also critical to record growth. Together the Georgia Chamber and local chambers work hand-in-hand with community and state leaders from both sides of the aisle alongside a governor devoted to a safer and healthier state and economy.
Maintaining our economic edge through turbulent times requires that we actively build on this effective and efficient foundation. Earlier this year we released a report focused on growing a New Georgia Economy. Research shows clearly that we must continue to concentrate policy and strategy on three critical areas:
1.) Georgia has a strong history of investing in infrastructure and that must be maintained. The infrastructure of the future requires a dynamic energy grid, a completed Plant Vogtle, a diversified portfolio and e-mobility charging. We must also invest in our supply chains by building out rail, air, port and road infrastructure. It is projected that the demand for third-party logistics services will double in the next 5 years to $408 billion, underscoring the significant growth our state is experiencing. Georgia must also focus on cybersecurity, healthcare outcomes and telecommunications to ensure that every community and every business has access to global markets.
2.) We must also keep building an innovative inclusive, and dynamic economy that we started back in 2008. We do this by increasing minority small business success, helping more Georgians start their own businesses and attracting more research and development and technology investment. Our state’s research universities generate more than $2 billion a year in public and private research and development funding, proving our state is poised for even greater innovation and growth. Our local and state elected leaders must also continue to offer innovative policies and a competitive tax and incentive business climate that levels the playing field with other states.
3.) Finally, we must win the ongoing war for talent and address both short- and long-term labor shortages. Though a downturn would see unemployment rise; projections show that it will be a short-term challenge. Long-term, Georgia communities must improve workforce housing stocks and career pathway alignment. We need more on-the-job training. Educators must address unfinished learning issues rising from lost classroom time during COVID-19 and we must reform our legal immigration system nationally to address critical industry shortages.
By 2025, Georgians must fill 30,000 manufacturing jobs, 122,000 healthcare positions, 40,000 educators and 13,000 skilled professional openings. By 2030, we’ll need 42% more energy workers, 31% more data specialists and 33% more cybersecurity professionals.
By working closely with University System of Georgia Chancellor Sonny Perdue, Technical College System of Georgia Commissioner Greg Dozier and State School Superintendent Richard Woods to rethink workforce development and quality education, we will be able to keep our economy growing and help Georgians remain financially secure.
The good news is that Georgia business, education and elected leaders are working on all of these. We’re building on an incredible foundation and we believe that the Peach State will continue our strong economic performance even as the rest of the world struggles.
Chris Clark is president and CEO of the Georgia Chamber of Commerce.
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