Georgia’s Job Growth Continues with Moderation on the Horizon

Rajeev Dhawan of the Economic Forecasting Center at Georgia State University’s Robinson College of Business

ATLANTA–Job additions in Georgia increased from 72,100 new jobs in 2017 to 103,500 job gains in 2018, according to Rajeev Dhawan of the Economic Forecasting Center at Georgia State University’s Robinson College of Business.

But, job growth had a seesaw pattern, particularly in high paying catalyst sectors such as corporate, manufacturing and information technology, which lost 2,300 jobs in the first half of 2018 instead of adding its usual share of 15,000 new jobs.

“Was this apparent lack of job gains in the first half a data anomaly or was it reality?” Dhawan wrote in his “Forecast of Georgia and Atlanta” released Wednedsay, Feb. 27, 2019.

To find the answer, the forecaster looked at tax collections to form a complete picture of job quality and purchasing power in the economy.

“Georgia’s state tax revenues did not show a hiccup but continued to grow steadily,” Dhawan said. “The lack of catalyst job gains in the first half of 2018 is likely a data flaw, and the state employment picture completely turned around when corporate job gains rose by a stellar 26,900 jobs in the second half of 2018.”

Gains in the information and manufacturing sectors also drove job growth, with higher wage jobs producing stronger spending power and aiding future job growth in the domestic demand driven sectors of construction, retail trade and hospitality.

Transportation, which includes warehousing and distribution, posted strong gains throughout the year. Healthcare, which grew by 16,100 new jobs in calendar year 2018, is expected to continue to do well, with ongoing announcements and construction of medical centers across Georgia, such as expansions of Piedmont Athens Regional and Southeast Georgia Health System.

Dhawan expects the moderation trend of long-term growth apparent at the end of 2017 to return, as capital expenditures slow to a crawl.

“Advanced indicators of investment, such as commercial loan growth, show a rebound is unlikely. Continued strong growth would be hard to achieve in this mature stage of the investment cycle, because the low-hanging fruit of investment has already been picked,” Dhawan said. “Going forward, the momentum to push Georgia’s job growth onto a higher path is not there yet.”

Highlights from the Economic Forecasting Center’s Report for Georgia and Atlanta

  • Georgia employment will add 78,600 jobs (15,600 premium jobs) in 2019, 64,300 jobs (11,700 premium) in 2020 and 56,500 (10,700) in 2021.
  • Nominal personal income will grow 4.5 percent in 2019, 5.1 percent in 2020 and 5.2 percent in 2021.
  • Atlanta will add 52,700 jobs (10,800 premium jobs) in 2019, 42,300 jobs (8,600 premium) in 2020 and 40,100 jobs (8,400 premium) in 2021.
  • Atlanta housing permitting activity will fall 14.1 percent in 2019, decline 8.6 percent in 2020 and fall a further 3.4 percent in 2021.