ATLANTA — Rajeev Dhawan, longtime economist with Georgia State University, expects robust job growth in the Peach State to slow, but he sees little cause for concern.
Georgia’s economy added 276,900 jobs from 2016 to 2018, according to Dhawan. He projects Georgia will add another 199,400 jobs by 2021.
But it is not just the size of the employment gains that needs to be considered, Dhawan emphasizes. Some 23,400 of the 103,400 jobs created across the state in 2018 — only 23 percent of the total — were so-called high-paying “catalyst sector” jobs, meaning jobs in manufacturing, professional and business services and financial activities. The good news is he expects that percentage of catalyst sector jobs to increase in the coming years.
Dhawan, who serves as the director of the Economic Forecasting Center at GSU’s J. Mack Robinson College of Business, presented his economic forecast Wednesday, Feb. 27 at GSU’S Centennial Hall.
Apart from the information technology sector losing 2,300 jobs in the first half of 2018, something Dhawan called an economic hiccup, Georgia’s economy is healthy.
The positive effects of the job gains are reflected in sales tax collections in the state. In the second half of 2018, sales tax collections were up 8.3 percent on a year-over-year basis, according to Dhawan. “In this country, when an economy grows, tax revenues grow.”
Homebuyers flock to suburbs
Dhawan observes that homebuyers are moving away from Fulton County and Atlanta northward to Cherokee and Forsyth counties, and renters seem to be following.
Forsyth and Cherokee counties combined for just over 1,400 housing permits issued in the second quarter of 2017, and just under 1,400 in second quarter of 2018. For the same two quarters, Fulton County issued about 1,100 and 1,200 permits, respectively.
While the data on multifamily permits fluctuates more than single-family permits, renters are trending toward Forsyth and Cherokee counties, according to Dhawan. In the first three quarters of 2018, multifamily permits issued totaled about 2,200 permits, compared with about 500 for all of 2017.
“Because Alpharetta and Roswell were developed as a tech area, the tech workers are beginning to live in Forsyth County,” he said. “That’s why the multifamily projects in Forsyth County are beginning to tick up and the [number of] people are ticking up.”
To help determine the strength of the home building market, Dhawan relies on a reliable ratio that says one housing permit should be issued for every two jobs that are created.From 2000 to 2008, Georgia was building homes anywhere from two times to eight times higher than that ratio, which led to rampant overbuilding. Since the Great Recession, builders have become much more disciplined. They are building 0.4 homes per two jobs.
Dhawan’s forecast also calls for personal income in the state to grow 4.5 percent in 2019, 5.1 percent in 2020 and 5.2 percent in 2021. Meanwhile, he expects a net gain of 52,700 jobs in metro Atlanta this year, followed by 42,300 jobs in 2020 and 40,100 in 2021.
— Alex Tostado