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Anticipating economic shifts

AS THE CONFLICT WITH RUSSIA & THE UKRAINE INTENSIFIES, WHAT WILL THE LOCAL IMPACT BE?

What can Americans expect from the economy as the conflict continues between Russia and the Ukraine?

Over the last year, the cost of living in the United States has been at an all-time high. The invasion of Ukraine will likely drive prices even higher with inflation and slow down our economic recovery from the pandemic, experts believe. In fact, we’re already starting to see the effects in oil, gas, and grocery prices.

A key factor in how hard the conflict will impact the economy here will depend on Russia's response to the U.S sanctions set by President Biden. Russia could retaliate by halting oil, natural gas, and other major exports.

According to White House data reported by The Hill, trade between the U.S. and Russia totaled $35 billion in 2019, making it the 40th largest export market for American producers.

Russia is an energy superpower, producing nearly 9.7 million barrels of oil per day last year, as reported by CNN. In the United States the prices of oil have jumped to unseen levels since 2014, and the invasion of Ukraine could derail the Russian energy supply.

CNN Business stated that if Russian oil flows are disrupted by the crisis, oil prices could jump to $120 a barrel.

Currently, the national average cost for a gallon of gas is at a seven-year high of $3.50 a gallon and will continue to increase if so. If the steep increases in oil prices do continue, not only will gas prices continue to rise, but natural gas prices could raise home heating and electricity costs. CNN explained that with higher energy costs, it will also make it more expensive for flying, and keep transportation and input costs elevated for businesses already suffering from surging expenses.

The conflict between these two countries will also ensure further supply chain issues.

Although oil is Russia's major export, both Russia and Ukraine are also large agricultural suppliers of wheat, rye, barley, and other grains. CBS explained that a disruption to the produce industry will send global food prices higher.

CBS also reported that Russia plays a significant role in the production of metals such as aluminum and palladium, while Ukraine is Europe's top producer of uranium, titanium, manganese, iron, and mercury. The sanctions placed on Russia by the United States have already resulted in the rapid increase in the price of aluminum. Aluminum International Today went on to explain that Russia accounts for six percent of global aluminum production, making it the second largest aluminum producer next to China.

The Ukraine is the ninth largest uranium and sixth largest titanium producer in the world and with worsening conditions due to the conflict there will be economic repercussions globally.

With Russia and Ukraine's involvement in the metals industry, those supplies will decrease and therefore, industries will have to pay more to receive it.

According to CNN Business, if inflation continues to rise and spikes above 10 percent, the Federal Reserve will inevitably struggle to find ways to keep prices for goods and borrowing costs of consumers under control. This will result in a faster pace of interest rates for consumers on everything from mortgages and

TIM MOSSHOLDER/UNSPLASH From interruptions in production to shortages to price increases, the overseas conflict is beginning to be reflected in the United States’ economy.

car loans to credit cards.

On another note, the conflict between these two countries can result in an unsteady stock market in the United States. A prolonged market downturn would have the potential to wipe out wealthy built-up families in the stock market and retirement accounts.

With these potential economic impacts, global unrest could startle American consumers, resulting in them cutting back on spending and partaking in other economic activities.

While these are major concerns across the United States, several factors will impact our community in Fort Bragg and Fayetteville.

The local economy, as the business community here knows, is resilient. However, the issues that will be faced will all depend on factors like the duration of the deployments of Fort Bragg troops and the timeframe that sanctions will last for.

“Obviously, the longer this plays out, the greater the impact,” said Robert Patton, vice president of Fayetteville Cumberland Economic Development Corporation. “If you compare where we're at today economically in the region to where we were, let's say the Gulf War, we have diversified our economy a lot more.”

Across the nation, everyone is also looking over their shoulders for signs of cyberattacks. The conflict in Ukraine has put the U.S. at a major risk. Recently, the New York Post released a statement that Toyota suspended its Japanese production vehicles because of a cyberattack. At this time, however, it is still unclear who conducted the attack, but following the Colonial Pipeline hacking last year by Russian hackers, and considering an increase in cyberattacks in 2021, cybersecurity is a high priority for many organizations currently.

“I caution everybody to be hypervigilant about cyber threats,” Patton stated. “This will impact us not only globally, but here, as well as supplies and other domestic resources.”

“Some service industries are going to be affected. Unfortunately, we do not know to what extent,” explained Patton. “Let's say your business is running dry cleaners, take that catering towards the military population, and with them not here, the numbers are going to take a hit.”

Although it is too early to assess the Russia and Ukraine conflict's full impact on the economy in our community and the United States, citizens need to stay on their toes for what is to come.

The Health Care Economy

HEALTH CARE LEADERS SHARE ABOUT STATE OF INDUSTRY AT POWER BREAKFAST

Greater Fayetteville Business Journal held its third quarterly Power Breakfast, themed “The Health Care Economy,” on Feb. 22 in Fayetteville.

The event, which focused on the business of health care and what changes are to be expected as we emerge from COVID, was a sold-out success at Highland Country Club. It featured a panel of health care leaders in the community: Colonel Christopher Jarvis, commander of Womack Army Medical Center, Daniel Dücker, executive director of the Fayetteville NC VA Coastal Health Care System, and Michael Nagowski, CEO of Cape Fear Valley Health System.

“Health care is 20 percent of the gross domestic product of the U.S. economy,” Marty Cayton, publisher of GFBJ, stated in his opening remarks.

The panelists shared how their organizations have been affected over the last two years, considering that health care is such a large industry that was heavily affected by the pandemic.

“I think when you think of what's happened to us as an industry and as a nation related to COVID, I think a lot of it comes back to leadership,” stated Nagowski. “We have to adjust, and everyone must understand that it's not going away.”

Each health care panelist agreed that they have had to adjust, adapt, and overcome challenges as leaders to push their organizations forward. With this motivation to keep moving forward, these health care leaders leaned on one another and worked together.

“We're all facing the same challenges, but we have our unique versions of these challenges, and we can easily depend on each other to work through them and approach a solution,” explained Jarvis.

Despite the negative impacts that followed COVID-19, organizations were forced to be more efficient in communication and decision-making. Through collaborative efforts during

PHOTO BY ROXANA ROSS/CAPE FEAR VALLEY HEALTH The panel for the Power Breakfast was made up of local leaders in the healthcare industry. rocky circumstances, the local health care facilities have effectively woven their way through supply shortages affecting health care systems across the nation.

“One of the nice things about working in the largest health care system in the nation is having a way to cover each other,” said Dücker. “With the spikes in New York and Louisiana, we have been sending supplies there. If we had a crisis, they would send supplies to us too.”

The Greater Fayetteville Business Journal plans to continue offering opportunities for networking and digging deeper into important topics within the business community and is ready to put on its next event.

The Journal hosts the Power Breakfast on a quarterly basis, and it is a premier networking event in the region. Past themes have included “For Our Defense” and “Entrepreneurs & Acquirers.” To stay in the loop about future Power Breakfasts, subscribe to GFBJ’s daily emails at BizFayetteville.com/Subscribe.

>> By Savanah Ramsey

bizfayetteville.com

USSOCOM Technical Experimentation event 22-3

EMERGING TECHNOLOGY INSTITUTE SET TO HOST EVENT IN JUNE

An opportunity for North Carolina’s small businesses, academic institutions, and innovators is on the horizon.

From June 6-10, the USSOCOM Technical Experimentation event 22-3 will be held at the Emerging Technology Institute in Red Springs, North Carolina. The themes for the event are “Soldier Systems” and “Standoff Through-Wall Imaging.”

The event evaluates innovative technologies that can offer Special Operation Forces increased capabilities in the areas of protection, location and tracking, visual augmentation devices, advanced power solutions, and more.

“ETI is excited to have another opportunity to support SOCOM again but more importantly this event gives North Carolina small businesses and academic institutions an opportunity to be face to face with Program Managers and PEO offices that fund and develop new technologies that support Special Operations,” stated James Freeman, founder and president of ETI. “Everyone dreams about being able to demonstrate to SOCOM and this event is the Super Bowl technology demonstration. This only happens four times a year and it has been a long time since a SOCOM T&E has taken place near Fort Bragg.”

The deadline for submission is March 18 at noon DST. After reviewing the technical experimentation nomination submissions, the government will invite select candidates to demonstrate their technologies at the USSOCOM event.

If experiments radiate a given frequency or frequency band, it must have prior approval to transmit on that frequency.

These nominations shall be submitted electronically by creating a Scout Card at www.vulcan-sof.com by the deadline. A complete submission consists of: • Creating a Scout Card in the Vulcan system. • Completed supplemental sheet attached to the Scout Card. • Devices with radio frequency emissions must state the intended frequency used by the device. • An FCC STA, Experimental License, or

NTIA document. • Instructions on how to safely use the technology. • A picture of the device with a short description if applicable. • A signed photo release. For more information, contact tech_exp@socom.mil or 813-826-4646.