Publisher’s Note: We are 1/3rd of the way through 2024. Let’s see how predictions are going so far for AU Hull College of Business professor, Dr. Rick Franza. Here is his report from four months ago!
Last week, Augusta University’s Hull College of Business held its annual Economic Forecast Breakfast, and my inimitable colleague, Dr. Simon Medcalfe, gave his uniquely informative and amusing take on what the local economy may have in store for us in the coming year. Dr. Medcalfe has inspired me to break out my crystal ball to provide you with my predictions on a number of business-related topics for the coming year. Every time I do a column like this one, I recommend that you print it out and save it, so that you can see how I did at the end of the year. Please note that my crystal ball is composed primarily of a mix of data and pragmatic optimism. With that caveat, here is what the crystal ball says for 2024:
National Economy:
In 2023, the major areas of concern in our national economy were inflation, interest rates, and the fear of recession. These issues will again be at the forefront in 2024 as follows:
- While the annual inflation rate has dropped to 3.2% from its high of 9.1% in mid-2022, inflation will remain sticky and likely not reach the Federal Reserve’s target rate of 2% until 2025. Therefore…
- The Federal Reserve will not lower interest rates prior to the fourth quarter (post-election) of 2024. While financial markets have already priced in rate reductions by Summer 2024, the Fed will err on the side of caution and not rates lower until the annual inflation rate is under 2.5%.
- Despite these higher rates, the Fed will get its desired “soft landing.” While the growth of the economy will slow in 2024, it will not turn negative, thus avoiding a recession.
Managing Your Business/Trends in the Workplace:
- While more and more employees will return to the office in 2024, hybrid work will start to take hold as the predominant work model. While employers push for more time in the office and workers push for more flexibility, a hybrid model of 60 to 80% time in the office will result.
- The role of AI will become better defined in 2024. Automation will take on an increasing role in standardized work, which will impact many lower-skilled positions.
- Resilience and diversification in supply chains will become more prevalent in 2024. While the pandemic exposed supply chain deficiencies, it has taken a while for businesses to address them. Increasing supplier bases, finding more local production facilities, and ramping up risk management plans are among the steps being taken.
- Competing on personalized service will become a leading strategy in business. As AI reduces the need for labor in some areas, people can be redeployed to providing better and more personalized service in order to win business.
- Omnichannel marketing will be the pervasive way to do business. In order to maximize customer experience, physical stores, websites, and apps will provide a seamless experience for the best companies.
Local Economy:
- The CSRA will continue to successfully recruit new business to the area. Investment in workforce development will attract not only manufacturers, but technology and service companies as well.
- We will still be waiting for the “cyber tsunami” in 2024. The CSRA continues to build the foundational pieces in education, training, and entrepreneurship to become a cybersecurity power, but it does not happen overnight. However, when the tsunami finally hits, it will be an “overnight success story that was years in the making.”
- Federal government investment will be the big story of the economy in the CSRA in 2024. Between the revitalization of the Savannah River Site (SRS) and the White House’s “Investing in America” the selection of Augusta as a “workforce hub” will have a major impact on our local economy.
Business of Sports:
- College Football will begin its separation from other college sports. Given the financial behemoth that college football has become, 2024 will initiate a plan for a new structure for the top 40-70 programs separate from the NCAA and its current conferences. Early in 2024, I will provide a column on what that might look like.
- The year 2024 will be the year men’s professional golf will undergo significant change. While 2023 provided much turbulence, important negotiations are still ongoing on what the PGA Tour, LIV, and other tours will look like going forward. Locally, Augusta National and the Masters will play an important role in what will ultimately be decided.
That is all that my crystal ball has to say for now. During the year, do not hesitate to let me know how these predictions are working out. In the meantime, I hope that you and those close to you have a most blessed holiday season and a happy, healthy, and prosperous New Year!
