Dhawan: Small Business Hiring, Port of Savannah Revive Georiga Economy
ATLANTA — In his “Forecast of Georgia and Atlanta” on Thursday, Aug. 27, Rajeev Dhawan, director of the Economic Forecasting Center at Georgia State University’s J. Mack Robinson College of Business, displayed confidence in Georgia’s overall economy going forward. Rajeev reported the sharp deceleration seen in Georgia’s employment growth from 3.9 percent in the second half of 2014 to 1.7 percent in the first half of 2015 will reverse in the second half of the year.
“As global economic health stabilizes, consumers demonstrate a greater propensity to spend and corporate spending resumes, the Peach State’s job growth will accelerate to 2.6 percent for the 2015 calendar year,” says Dhawan.
Small business hiring, national demand for carpet and auto parts manufactured in Dalton and Gainesville, and economic activity at the Port of Savannah will add to the growth.
The Georgia Ports Authority announced it moved a record number of shipping containers in the most recent fiscal year. The Port of Savannah experienced a 17 percent increase in 20-foot equivalent container units, and the authority as a whole experienced a 7.8 percent increase in total tonnage.
Construction is expected to begin this year on an inland port in Murray County that will serve as a direct link from the Port of Savannah to North Georgia, Alabama, Tennessee and parts of Kentucky. According to Dhawan, “that’s good news for manufacturers in North Georgia who will likely see positive economic growth and benefit from national housing and auto demand.”
The corporate sector is faring well in Georgia and Atlanta. Statewide, the sector posted a 7.2 percent gain in the second quarter, “pointing to momentum moving forward,” says Dhawan. Furthermore, the move of several headquarters to Atlanta continues to result in professional and business services hiring.
“Although this sector is enduring weaker global growth, domestic consumption is taking up any shortfalls,” Dhawan said.
Housing demand has been boosted by numerous moves of headquarters and offices to metro Atlanta. In the second quarter of 2015, total housing permits in the area grew by 25.3 percent over the same period in 2014, driven by a 36.6 percent growth in multifamily permits.
Dhawan said Millennials, who constituted 23.6 percent of metro Atlanta’s population in the 2010 census, are making their presence felt in many ways.
“To no one’s surprise Millennials are fueling demand for multifamily housing. They’re also spurring area companies to relocate to downtown and Midtown in order to draw on their high-tech skills,” says Dhawan.
Also gaining momentum is Atlanta’s information sector, which added 600 jobs in the first half of the year.
“I expect the area’s information sector to continue to expand in coming years as it benefits from a robust fiber optic infrastructure, relatively low-cost electricity generation and a reliable power grid,” says Dhawan.
Although growth in the metro area’s hospitality and transportation sectors slowed somewhat in the first half of the year, both will benefit from the spillover of domestic demand growth in catalyst sectors (corporate, healthcare, technology and manufacturing) for a combined total of 12,800 jobs in 2015. Healthcare alone added almost 3,500 jobs in the first half of 2015. For the full year, the sector is projected to add 8,100 jobs.
In addition to jokingly announcing his bid to run on Donald Trump’s presidential ticket, Dhawan made several predictions about Georgia’s economy in the near term. Highlighted were:
• Georgia employment will gain 82,900 jobs in calendar year 2015, 87,500 jobs in 2016 and 94,100 in 2017.
• Atlanta will add 62,400 jobs in calendar year 2015, 63,300 jobs in 2016 and 65,500 jobs in 2017.
• Nominal personal income in Georgia will increase 4.6 percent in 2015, 5.1 percent in 2016 and 5.8 percent in 2017.
• Atlanta’s housing permits increased 25.3 percent over the second quarter of 2015 compared to the same period in 2014.
• Permitting activity in 2015 will increase 8.9 percent. Permit activity will grow 11.2 percent in 2016 and will grow 6.9 percent in 2017.
— John Nelson