Atlanta slipping in number of high-paying jobs

By Maria Saporta

Friday, July 17, 2009

Metro Atlanta has been one of the fastest-growing regions in the country, but its income and job growth has not kept up with population.

That is the prevailing theme that has emerged from a six-month analysis by the New Economy Task Force of the Metro Atlanta Chamber that was presented to its board on July 16.

“We have grown our economy incredibly, but we are slipping on per capita income,” said Sam Williams, president of the Metro Atlanta Chamber. “Our income growth is not holding up. We need to focus on the top of the pyramid for higher-paying jobs.”

The study, conducted by the Bain & Co. consulting firm, found that in the decade between 1998 and 2007, metro Atlanta’s per capita income growth was the lowest among the major 25 cities in the country.

The task force is making several recommendations to help the Atlanta region be more competitive going forward:

• Continue to target industries where metro Atlanta has competitive advantages: logistics and supply-chain businesses, technology, the health and bioscience sectors, and business services.

More importantly, the task force will recommend finding specific areas of strength within those sectors where metro Atlanta can dominate and can bring higher-paying jobs to the region.

Other recommendations:

• Focus more attention on “organic growth” and support existing companies and entrepreneurs;

• Continue to go after corporate headquarters, international facilities and data centers;

• Have better coordination between economic development agencies across the region and state, including universities and businesses;

• Push for stronger economic development legislation, including passing new incentives, better workforce development and venture capital; and

• Continue to work on quality-of-life issues, such as transportation, water and education to keep the region competitive.

When looking at specific business sectors to target, the study outlined several possibilities:

In logistics, that could include supply-chain management software, air cargo and distribution.

In technology, possible subareas include software, wireless communications, data management (such as digitized medical records) and Internet content.

In health/bioscience: global health and communicable disease, medical biotech and medical research.

And in the business professional services area: engineering, architecture, graphic design and marketing.

The chamber will establish teams to explore which subsectors have the greatest potential and make specific recommendations by the end of the year.

Rick Smith, CEO of Equifax Inc. who is this year’s Metro Atlanta Chamber chairman, said the study is “very timely” given the dislocations and changes in the national and global economy.

“We wanted to know whether the path we are on is the right path for the future,” Smith said. “We’ve had a lot of logistics growth, but it’s been the lower-paying jobs. By in large, the areas we are going after are good, but they are too general.”

David Ratcliffe, CEO of Southern Co., who chaired the task force, said the chamber needed to “recalibrate” and be more focused rather than casting as big a net.

Ratcliffe, who also chairs the Georgia Research Alliance (GRA), said the study reinforced the bioscience emphasis of the public-private group that includes the state’s six research universities.

But there does need to be better coordination between the Metro Atlanta Chamber, the Georgia Chamber of Commerce, the GRA, the Georgia Department of Economic Development and other groups across the region and the state.

Alan Colberg, managing director of Bain & Co.’s Atlanta office, said the study exposed the stiff competition Georgia is facing.

“It’s going to get worse, not better,” said Colberg, adding that in talking to relocation experts there’s room for improvement.

“Georgia, compared to other states, is slower to mobilize, harder to know who you should be talking to,” Colberg said. “We have fewer dollars to invest in economic development, and the dollars that we do have are more fragmented. Other states have dramatically increased their commitment to economic development dollars. Georgia has been much slower to respond.”

Regions Bank executive Bill Linginfelter, chair-elect of the Metro Atlanta Chamber and the GRA, said the stiffer competition is not just from our normal rival cities of Dallas, Phoenix and Denver.

He is seeing greater competition from Southern cities, such as Nashville, Charlotte, Jacksonville and Birmingham.

“They have made a significant amount of progress,” he said.

For Williams, he has his work cut out for him. “Our No. 1 goal ought to be increasing the per capita income for people in Atlanta and Georgia,” he said. “We need to figure out how do we help existing companies grow with higher-paying jobs.”

And the chamber must continue to work on the quality-of-life issues of transportation, water and education. “If we don’t get those fixed, it will hinder our success,” Smith said.

The Metro Atlanta Chamber has already made those issues its top priorities, but has received little support in the state legislature.

“Quality of life and sustainability are key issues going forward,” Williams said. “As hard as the whole business community has worked on issues like transportation and water, we are still way behind in catching up with our growth.”

Maria Saporta, Editor, is a longtime Atlanta business, civic and urban affairs journalist with a deep knowledge of our city, our region and state.  Since 2008, she has written a weekly column and news stories for the Atlanta Business Chronicle. Prior to that, she spent 27 years with The Atlanta Journal-Constitution, becoming its business columnist in 1991. Maria received her Master’s degree in urban studies from Georgia State and her Bachelor’s degree in journalism from Boston University. Maria was born in Atlanta to European parents and has two young adult children.

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