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Better Days Ahead for Georgia?
UGA: Increase in shipping should help local economy slowly recover
by Walter C. Jones, Morris News Service
December 17, 2009
Georgia's economy may have outperformed
the rest of the nation's in the recent boom years, but the same factors are going to make it lag
the nation in recovery, according to a recent forecast by the University of Georgia. "We don't feel
like we're in a recovery," says the school's business dean, Robert Sumichrast. "In fact, we feel
awful."
A steady influx of new residents over the years fueled growth in the real estate sector as
well as construction, flooring and furniture, giving the Peach State a stronger economy then than
the rest of the country. But, when the housing industry sank, Georgia's heavy reliance on housing
caused the state to suffer more than the rest of the country in the recession. And that's why it
will be slower in coming back, Sumichrast says.
As a result, Georgians can expect a 1.7 percent expansion in their economy next year while
the rest of the country will see 2.25 percent.
On the job front, layoffs will continue until Georgia's unemployment peaks at 11 percent in
the middle of next year. It will take until 2013 for the state to recover all of the jobs it lost
during the recession, according to the forecast. "Our forecast anticipates that the job machine
will shift gears from reverse to forward in the second quarter of 2010," Sumichrast says. "Job
growth should be just adequate to sustain the expansion."
Early next year, businesses will start to spend the cash they socked away from the beginning
of the recession, but consumers will be more cautious. While consumers will begin buying more food,
medicines and other select goods, they will limit the increase to just 1 percent, mostly because
they can't borrow any more money on their credit cards or homes.
Since considering consumer spending accounts for 70 percent of the economy, the recovery
can't get into high gear unless consumers boost their spending more.
Around the state, the forecast calls for the most activity to center on Columbus because of
the 11,000 new jobs coming to Fort Benning. Athens will lose nearly 1 percent of its jobs,
primarily from government, construction and manufacturing.
Augusta can expect to shed 0.3 percent of its jobs in 2010, remaining stronger than the rest
of the state because of its strength in health care and education.
Savannah's continued employment decline will slow to just 0.2 percent in 2010. "Savannah's
unique ambiance, transportation infrastructure and thriving ports make this an attractive place in
which to live and do business," the forecast states. "Tourists and retirees are also attracted by
the areas unmatched vibrancy."
Shipping will also be a boost for
areas with ports. "Georgia's ports should recover vigorously by tapping directly into the economic
growth that is taking place overseas, by diversifying the services that call on Georgia's ports,
and by taking market share from other U.S. ports," the forecast states.
Growth industries in 2010 include automobile and aircraft manufacturing and federal
employment, all areas heavily represented in metro Brunswick.
As in past years, the university is taking its forecast program on the road around the
state, heading to Savannah (Jan. 14), Augusta (Jan. 15), St. Simons Island (Jan. 29) and Athens
(March 3).
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