The Georgia Chamber of Commerce’s first stop on its 2019 New Georgia Economy Series was in Cartersville Thursday morning, as president and CEO Chris Clark gave opening remarks at a roughly three …
The Georgia Chamber of Commerce’s first stop on its 2019 New Georgia Economy Series was in Cartersville Thursday morning, as president and CEO Chris Clark gave opening remarks at a roughly three and a half hour regional small business summit at Georgia Highlands College.
“We have traditionally done 12-to-24 regional meetings throughout the year,” he began his presentation. “But over the last few years, as we’ve talked particularly to our small businesses, we found out that they are really struggling with what’s happening in the economy today, and they really want more information and more data and time to talk about and learn about this very different, changing economy.”
From his perspective, the state isn’t just going through one economic revolution, but no less than eight of them at the moment, with repercussions for everything from public policy and education to manufacturing and energy production.
“We’re seeing a boom right now in the green energy space, with the growth of solar in the state, and we’re seeing precision agriculture changing how we do a traditional industry sector in the state,” he said. “Companies have to adapt to what this new environment is, or they’re not going to be successful.”
From health care to insurance to law firms, Clark noted that no business sector in the state is immune from the looming “disruption economy.” Which is one of the reasons why he said he’s concerned about Georgia’s longterm economic competitiveness, considering the state has slid on Bloomberg’s United States Innovation Index over the last few years.
The state, he said, now ranks 32nd in research and development spending. When it comes to tech diversity, Georgia places 25th, and in STEM degree obtainment, 27th. Perhaps most concerning, he said, is the state’s ranking at 32nd in patent development.
“We have to be in the top 10 on this list over the next 10 years,” he said. “65% of the kids that we’re going to graduate today, the jobs that will be available to them don’t exist.”
Estimating that as many as 60% of today’s occupational positions may become automated — at least to some extent — within the next five years, Clark said he has concerns about the vocational training students are currently receiving in Georgia’s classrooms.
“We’re automating every single sector out there, so here’s the question for educators,” he said. “Are we training kids for jobs today that won’t exist in a few years?”
The impact of the “new economy,” he said, would have an especially pronounced impact on State-level politics.
“We’ve got to have the right physical infrastructure, broadband access as well as roads and bridges,” he said. “What we want to do is have a different conversation with our legislators in Georgia so we quit talking about the economy of the past and a taxation system that’s 40 years old and instead focus on what the new economy’s going to have — the internet of things, creative destruction, shorter product life cycles, automation, 3D printing.”
Speaking of State politics, Clark said the Legislature itself has the potential to be one of the biggest obstacles for Georgia’s small businesses — both established and fledgling — although he kept the specifics of how rather vague.
“One [risk] is that risky political environment, to make sure legislators don’t do something unintentional,” he said, “and to make sure that we keep an environment that’s a healthy business climate for you guys to continue to grow and do what you want to do.”
Another concern, Clark said, is the ability — or inability — of small businesses to procure funding for expansion.
“We have companies now in Georgia that are in their second or third phase of growing their companies and they can’t get access to capital, and they’re going to move to another state,” he said. “We have 68 counties in Georgia right now where you can’t have a financial decision made locally. What are your relationships and partnerships like so that you can get the resources that you need?”
The event also included a presentation from District 14 State Sen. Bruce Thompson (R, White) on the topic of business risk and continuity.
“The reality is that the assets that you have, if you don’t identify what those assets are and be prepared to protect them, in the unlikely event that someone hacks in, those assets are gone forever,” he said. “You’ve got to identify what it is that a criminal would want — if you don’t know what that asset is within your business, it’s very difficult to protect that.”
Indeed, he said cybersecurity is becoming an increasingly important concern, with the estimated global cost of cybercrime expected to hit $6 trillion by 2021. The domestic data is hardly any more comforting; in 2018, Thompson said more than 35% of Americans experienced some form of identity theft, in turn producing an estimated $17 billion in economic losses.
And it’s not just computers that are at risk — phones, wireless printers and even cars, he said, are all susceptible to electronic intrusion. He recalled hearing about one hacker in Las Vegas who used the Wi-Fi capabilities on a fish tank thermometer to access a "secure" casino network.
Still, Thompson projects almost half of all cybercrimes can be attributed to a single factor — careless and untrained insiders. “It’s the people who do not know how to protect your assets,” he said.
Even more daunting, he said, are the number of medical facilities that may be prone to cybersecurity breaches. “Roughly 25% of the hospitals in the state of Georgia are unprotected,” he said. “Why? Because they don’t have the resources or the knowledge.”
And if hospitals are at risk, he said, small businesses are certainly subject to the same vulnerabilities.
About 43% of all cyberattacks, Thompson said, target small businesses. And on average, he said about two-thirds of them go out of businesses within six months of experiencing a breach.
Thompson said he’s particularly unnerved by the number of small businesses that refuse to take even the simplest of protective measures, such as requiring dual authentication — i.e., two layers of passwords.
Furthermore, he said just 38% of small businesses regularly update their software and just 21% monitor credit reports.
But perhaps most baffling, he said, is the 75% of small businesses that have no form of cybersecurity insurance whatsoever.
“If you go to one of your carriers and you ask about cyber insurance, they’re going to have a standard operating procedure for you to follow,” he said.
Thompson maintains such protections are especially valuable when it comes to payroll, inventory and medical records — all sensitive information that could get small business owners into heaps of trouble with the feds in the case of a cybersecurity breach.
“If you have an exposure, the federal government does not give you a free pass because you were vulnerable and somebody hacked in,” he said. “You still are subject to the penalties, and in some cases that can be up to $25,000 per record.”