Georgia’s best growth opportunities can be found overseas and at home
By Maria Saporta
Georgia has some catching up to do to re-energize its economy.
Several efforts have been underway to do just that — such as Gov. Nathan Deal’s Competitiveness Initiative and the Metro Atlanta Chamber’s New Economy efforts.
Georgia Forward, a coalition of business, civic and government leaders, also has been shining the spotlight on what the state needs to do to adapt to tomorrow’s economy.
Marek Gootman, director of strategic partnerships for the Brookings Institution’s Metropolitan Policy programs, recently spoke at a Georgia Forward event, where he shared his assessment of the state’s economy.
For starters, Gootman said one must view the economy by metro regions rather than by states or the nation as a whole. The 100 largest metro areas in the United States take up 12 percent of the land, but they represent 66 percent of the population.
That’s dichotomy is even more pronounced in Georgia.
The state’s 15 metro areas account for 81 percent of the population, 84 percent of the jobs and 87 percent of Georgia’s economy.
“In Georgia, 15 metro areas drive the state economy,” Gootman said.
Brookings has said that the economic downturn during the past several years has not been a cyclical but a structural recession.
“We need new growth strategies beyond the traditional approaches to economic development,” said Gootman, who described those as Starbucks, stadiums and stealing business from other places.
But that might not be the best strategy. Just 3 percent of an areas economy comes from new locations while 42 percent comes from the expansion of existing businesses and 55 percent from new businesses and start-ups.
The magic recipe for a new economy should include exports, clean energy and clean jobs as well as innovation. It would be smart for Georgia companies to explore opportunities in developing markets around the world.
In 2010, of the total gross domestic product (GDP) globally, the United States accounted for 20.2 percent while the BRIC countries (Brazil, Russia, India and China) accounted for 21.4 percent. By 2015, BRIC countries will account for more than 25 percent of the world’s GDP.
“The growth map has shifted away from the United States and Europe,” Gootman said. “Growth is occurring almost exclusively in the emerging markets. We need to refocus our economy.”
In the United States, exports comprise only 13 percent of the nation’s GDP while exports represent 30 percent of the economy in China and Europe.
Producing products for clean energy and a green economy also represent great opportunities for Georgia’s companies. Currently, Georgia ranks ninth in clean energy, a high growth area. But Gootman said Georgia, the ninth largest state, does not stand out.
An area that Georgia can do well is with innovation. “There’s a very strong top tier research university sector in Georgia and strong technical colleges,” he said. But there also is a “job skills mismatch” with a significant gap on both the lower end and the higher end of filling people in positions.
Gootman said that Georgia needs to address its infrastructure needs — particularly transit.
The Brookings Institution ranked Atlanta 91st out of the top 100 metro areas in the United States for transit access. Only 38 percent metro Atlantans live near a transit stop and only 22 percent of the jobs are reachable by transit within 90 minutes.
Exploring the state’s economic potential and convening the various constituencies across the state are high on the list for Georgia Forward.
The organization will hold its third annual conference in Athens from Sept. 5 to Sept. 6.