Savannah Chamber

20 5 Banks adapted to COVID-19 by accelerating the use of digital banking products as well as streamlining processes, which increases productivity, resilience, and competitiveness. That should help traditional banks and credit unions cope with more competition from large retailers, venture capital funds, microfinance, and other nonbanks. These nontraditional competitors are not as heavily regulated as traditional banks or savings and loans, which gives them an advantage. Mobile banking will transform banking into a much more customer-focused business, which could advantage technology firms – or online retailers – that invade markets currently served by banks. Georgia's leisure and hospitality industry is a high contact industry and therefore was hit extremely hard by the COVID- 19 pandemic. In 2021, lodging demand will rise substantially, but from a very depressed level. It probably will take many years for Georgia's leisure and hospitality industry to fully recover from changes wrought by the pandemic, which has major implications for the prospects for Georgia's hospitality-dependent areas (e.g., Brunswick). Although uncertainty with respect to the pandemic reigns, it is possible to make some general observations about the prospects for various segments of Georgia's hospitality industry. First, leisure travel will recover much faster than business travel. Short-trips by car to visit relatives or friends will come back faster than long-trips to attractions or events – especially if the trip involves travel by air. Within the business travel segment, trips to see clients and to make sales calls will come back fairly quickly, especially when such trips can be made by car rather than by plane or train. Second, domestic travel will come back much faster than international travel. That observation applies to both leisure and business travel. Third, prospects for the lodging industry vary by property type. For example, economy and midscale properties that cater primarily to essential workers, construction crews, the truck drivers, first responders, extended-stay guests, and drive to leisure travelers will fare best. Full recovery for such properties will occur once consumer confidence and people's willingness to travel normalizes. Upscale and luxury properties catering to group/convention travelers, inbound international travelers, and fly-to leisure/business travelers will fare worst. Full recovery for such properties could take many years due to structural changes such as the widespread substitution of videoconferencing for in-person events. Finally, properties located in the suburbs, small metros, or on Interstates will outperform properties located in large urban areas or at fly-to resorts. Prospects for Manufacturing in 2021 Production by Georgia's manufacturers will continue to recover from the virus crisis. Indeed, industrial production will increase more quickly than GDP. Due to productivity gains, manufacturing jobs will increase more slowly than the total number of jobs across all industries, however. The main impetus to growth in manufacturing production will be recovering global demand for manufactured goods. Due to factory shutdowns in the first half of 2020 there's also need to produce more to restock stores and warehouses. Inventories were only partially restored in 2020 and will be fully restored in 2021. COVID-19 is the main downside risk, but an escalation of the US-China trade war also could endanger the projected increases in industrial production. More positively, Georgia saw many manufacturing economic development projects announced in 2020 and those projects – as well as some announced in prior years – will continue to build out, contributing to the increase in industrial production expected in 2021. Georgia's manufacturing sector is cyclically sensitive and depends heavily on international supply chains and export markets. In most years, Georgia manufacturers' focus on export markets works to the state's advantage economically. For example, Georgia's exports surged to over $41.2 billion in 2019, up 2 percent from 2018. Georgia was the nation's twelfth largest exporting state and its top five markets were Canada, Mexico, Germany, China, and Singapore. Georgia's largest manufacturing industry is food processing. Food processors fared relatively well during the pandemic, but had to accommodate to higher sales to grocers and lower sales to restaurants and institutions. It is very good therefore that many of the economic development projects announced over the last few years were food processors. Production will increase substantially in 2021. Agribusiness and food processing projects announced in 2020 include Anheuser-Busch, BANG ENERGY, Sugar Bowl Bakery, Kerry Group, Batter Up Foods, Frito Lay, Coffee Cake Bakery and General Mills. Georgia's vehicle parts manufacturing industry will benefit from higher domestic demand for vehicles. Political pressures that encourage foreign manufacturers to invest more in US production facilities and to buy automotive parts from US manufacturers will help. In addition, there are more assembly plants in the Southeast in the wake of the COVID-19 recession than in the wake of the Great Recession. Vehicle parts manufacturing projects announced in 2018-2020 that will bolster growth in Georgia's vehicle and vehicle parts manufacturing industry include GEDIA Auto Group, SK Innovation, Enchem, Sangsin Technology, Nivel Parts & Manufacturing, Acoustics & Insulation Techniques,

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