Economic Development in the Atlanta is exploding. Local counties and cities have ramped up their economic development efforts to match the area’s impressive evolution, and the ATL has become a magnet for even more expansion. read more
Recently, experts from research firm Construction Coverage decided to look at geographic mobility in the United States and identify the most transient American cities. When looking at Atlanta and its data from 2019 (before the pandemic), the researchers discovered that in a one-year span, nearly 86,000 people moved to or within the metro area, representing an astounding 17.1 percent of Atlanta’s population. More than 19,000 of those individuals relocated from other states, while over 3,500 moved from other countries. In fact, according to Penske, Atlanta is the second most popular moving destination in the nation.
Of course, it’s not just people who are moving to Atlanta—businesses also are choosing to call the metro area home. From Fortune 500 firms to burgeoning startups, companies are making their way to the ATL each and every day. In June 2020, Startup Genome recognized Atlanta as one of the top 25 global startup ecosystems. And for decades, Atlanta has been known as a big business juggernaut, with 16 Fortune 500 and 11 Fortune 1000 companies have established headquarters either within the city limits or in surrounding locales. What’s more, Georgia’s business climate has been ranked number one in the country for the sixth consecutive year by Site Selection Magazine, as reported by the Metro Atlanta Chamber.
While a variety of factors go into the decisions that drive both people and businesses to make their way to Atlanta, some of the most important and pressing ones deal with a very particular issue: finances. If you are going to live or do business in a city, then it has to make financial sense. Here, we look at just a few of the financial reasons that make the metro area so attractive to so many.
When people contemplate whether or not they should choose a certain city as their new home, they always consider the cost of living. This all-encompassing term refers to a number of elements, from the affordability of housing and food to the health of the job market and access to cultural opportunities. Fortunately, Georgia’s ranking is pretty impressive when it comes to the cost of living; the World Population Review notes that it currently is the ninth state in the U.S. with the lowest cost of living, coming in with a cost index of 89.2. In fact, U.S. News & World Report recognizes Georgia as the sixth most affordable state in the entire nation. And metro Atlanta is one of the state’s biggest draws, thanks in large part to the fact that it offers some pretty notable financial benefits that make the area a great option for individuals of all ages.
No matter where you relocate, you have to have a roof over your head. Not only does metro Atlanta have a great variety of home options, from single-family homes, townhomes and condos to a bustling rental market, but it also boasts a level of affordability that makes it more attractive than many other large cities to which it is often compared. Kiplinger notes that the median home price in Atlanta is around $250,000, giving the city an affordability index of four; that places it ahead of large metro areas like Austin, Texas; Boston, Massachusetts; Miami, Florida; New York City, New York; San Francisco, California; and Seattle, Washington, among many others. And this affordability in the housing market benefits a range of buyers.
“Atlanta generally fares well compared to a number of major metro areas when you look at the cost of living indexes. A good portion of that is housing,” says Kathy Connelly, Senior VP of Corporate Services for Berkshire Hathaway HomeServices. “That affordability is very good for first-time homebuyers, who often feel priced out of the market.”
That’s often because the purchase of a home isn’t exclusive to the amount spent on the residence alone. As Connelly notes, there are numerous additional costs associated with homeownership, from insurance and home association fees to property taxes. And while rates and various costs will differ depending on your situation, there are some general numbers you can consider. For example, according to BankRate.com, the average homeowner in Georgia pays just over $1,500 per year for their home insurance policy. When it comes to property tax, SmartAsset.com notes that the median real estate tax payment in the state is around $1,770, which is about $800 less than the national average. (Of course, the rate does vary by county within the metro area.) In some instances, the property tax rate, which sits at around 0.87 percent, is thousands of dollars less than someone would pay in another large city. What’s more, Connelly adds, mortgage interest rates are at historic lows right now. All of this has led to Atlanta being named the #6 City for First-Time Home Buyers (among large cities) by WalletHub.
In the long-term, a home investment is a great opportunity in Atlanta. FinTech firm Roofstock notes that over the last five years, home values in the metro area have increased a total of 49 percent, with an increase of 5.6 percent in the last year alone. With that kind of return on investment, as well as the savings upfront, it’s no wonder why Connelly states that, in many instances, it is cheaper to purchase a home than to rent in the metro Atlanta area.
Of course, if you’re going to purchase a home in Atlanta, or fund your lifestyle in any way, you have to have a solid income. Atlanta’s strong economy (even as the pandemic surged throughout 2020) looks to be rebounding and has allowed the thriving job market across a host of industry sectors to remain mostly intact. In 2020 alone, the metro area was named the #1 Metro Area Tech Hub by Business Facilities, as well as the #4 Best Metro Area for STEM Professionals, the #2 City for Professional Opportunities and the #3 City to Start a Career by WalletHub. Some of the key industry segments across metro Atlanta, according to the Metro Atlanta Chamber, are FinTech, Bioscience, Technology and Supply Chain and Advanced Manufacturing. And when it comes to salary, Salary Explorer reveals that, in 2021, the average salary in Atlanta is $95,600, with the highest average salary coming in at around $427,000. And as businesses continue to be attracted to and move into the area, job growth—and the number of good-paying jobs—hopefully will remain on an upward swing. In fact, Invest Atlanta notes that 1.9 million jobs are forecasted to be created in the area by 2040.
Additionally, as Connelly reveals, when relocators move into Atlanta, they often are doing so for work. Yet, they aren’t only concerned with themselves—they also want to ensure that their spouses or significant others have employment options. “This is a very diversified economy. There isn’t really one industry that dominates the entire field,” she says. “And when people are brought into the area, they want to know that there’s employment availability for their partners or spouses as well. And there are employment opportunities here.”
Taxes are a key element when it comes to the cost of living, and Atlanta residents benefit from an array of low rates. Georgia’s sales tax rate sits at four percent. Atlanta’s combined sales tax rate (which encompasses state, county and city sales tax rates) is 8.9 percent, as Fulton County’s sales tax is three percent and the City of Atlanta comes in at 1.5 percent. The combined rate obviously changes from county to county, as areas outside of the city limits have varying rates, from Cobb County’s six percent sales tax to Henry County’s three percent rate.
Each county within the metro area also offers a range of homestead exemptions that are worth researching and applying for when applicable. For instance, in Fulton County alone, there are several homestead, school tax, senior citizen, low income, disabled veterans and other local exemptions. It’s important to check the local county government for options to help you save money.
For eight consecutive years, Georgia has been named as the #1 State for Business by Site Selection Magazine. In fact, the state often touts its pro-business environment, which includes everything from access to a skilled workforce and reliable infrastructure to the availability of low business taxes and overall solid fiscal strength. According to Brenda Robbins, Business Recruitment Director for Georgia Power’s Community and Economic Development team, not only is the State of Georgia very business-friendly, but the metro Atlanta area also outperforms many other major U.S. cities in terms of attracting and catering to new and relocating businesses.
“When you think about the success of Atlanta, there are a number of reasons for that success,” she notes. “Companies that move here can attract the diverse talent they need to innovate and to grow, as well as expand their customer base from Atlanta. There’s also a culture of collaboration throughout the business community. And there are attractive real estate options across a range of urban and suburban settings.”
All of these elements make doing business in metro Atlanta both cost-effective and profitable. And that’s the name of the game for many of the companies that choose to call the metro area home.
Business Taxes and Tax Credits
According to the State of Georgia, the state’s corporate income tax structure is ranked sixth in the nation in terms of its favorability. For decades, Georgia’s corporate tax rate stood at six percent; however, in January of 2019, it was lowered to 5.75 percent. This change has been beneficial to businesses moving into and expanding within the area, but it is only one of the many incentives the state, and thus metro Atlanta, offers to companies of all sizes.
Tax credits often are a driving factor for companies considering a relocation or an expansion. In recent years, one of the tax credits that received the most attention was the Georgia Film, Television and Digital Entertainment Tax Credit, which allows a 20 percent tax credit for companies that spend $500,000 or more on production or post-production work done in Georgia. Yet, there are myriad additional credits that companies can take advantage of depending on their individual situations. For instance, Job Tax Credits (JTC) are available to companies that create new jobs in Georgia, while Quality Jobs Tax Credits (QJTC) can provide benefits to companies that create and maintain new jobs that pay at least 110 percent of the county’s average wage. There also is a tax credit dedicated to organizations that perform research and development (R&D) activities in the state, as well as an Opportunity Zone Tax Credit, which gives qualified businesses a $3,500-per-employee credit against state corporate income taxes for five years if they locate in a less-developed census tract. And recently, a new incentive was developed that rewards companies that create jobs designed to expand the manufacturing of personal protection equipment and hand sanitizer to fight the COVID-19 pandemic. What’s more, additional tax exemptions, grants and loans are available for a wide range of qualifying businesses.
The Talent Pool
“Atlanta is very highly regarded for its talent pool,” Robbins states. “There are 300,000 students enrolled in higher education, and when you look out at a 250-mile radius, there are two million college students . Atlanta is the economic engine for the Southeast, and it naturally draws talent from across the region.”
This large talent pool gives companies that reside in Atlanta a bona fide competitive edge. And because there are so many educated and skilled potential employees within the metro area, many of whom currently attend the area’s highly acclaimed 54 two- and four-year colleges and universities, the length of time it takes to find the right fit for open positions is shortened. This, Robbins notes, helps reduce recruitment and onboarding costs in the long run.
Furthermore, Georgia has been recognized as the #1 State for Leading Workforce Development Programs. It is home to the top workforce training program in the country, Georgia Quick Start, which has trained more than one million employees since its inception four decades ago.
Building a solid and enduring customer base is the cornerstone of a flourishing business. Atlanta is an ideal location for developing that base, not only because there are so many potential customers here, but also because customers can be accessed easily from across the region and the country, increasing businesses’ opportunities to boost their profits. And it all starts with Atlanta Hartsfield-Jackson International Airport, which has been recognized as the #1 Busiest Airport in the World. The location of the airport, as well as its size and impressive activity, gives businesses direct access to markets across the country and the globe. In fact, upwards of 80 percent of the United States population can be reached within a two-hour flight. And it’s not just passengers who move through the airport daily; according to the State of Georgia, more than 650,000 metric tons of cargo is shipped via the airport, which also boasts 1.3 million square feet of cargo warehouse space. And metro Atlanta’s access to a sophisticated highway system, which also leads to key railroad hubs and ports along the East Coast, expands the business opportunities of companies that choose Atlanta as their home base.
In addition, now recognized as a high-tech mecca, Atlanta gives businesses access to a fiber-optic infrastructure that is second to none. The ability to do business quickly using today’s most innovative technology ultimately gives Atlanta-based businesses a true advantage and the chance to increase their corporate income. It’s all part of the complete package that makes Atlanta one of the most financially viable cities in the nation for companies across a range of industries.
IN THEIR OWN WORDS
Business owners and executives have great things to say about Atlanta’s many benefits, including the various financial ones that make this one of the most popular locales for startups and expanding companies.
“Show me another major U.S. city that has quick access to a large number of highly talented, creative people and a 30 percent tax break.”
—Matt Thompson, Principal, Executive Producer, “Archer”
“Today’s the day where we bring our 127-year history and we plant our flag here in Atlanta, Georgia. People ask me why, and I say, ‘Well, really it’s not just one thing. It’s all the things added up. It’s the business environment, it’s the quality of life, it’s the infrastructure.’ Atlanta is a premier city which provides the perfect foundation to write the next chapter of our success story here in the U.S.”
—Steve Cannon, CEO, AMB Group, LLC
“Atlanta is a great place to do business. It’s also important for us to be in a place that has talent and a business-friendly environment.”
—Elie Maalouf, CEO of the Americas region at InterContinental Hotels Group (IHG)