ATLANTA - - Augusta had the state's second-best economy growth in the first three months of the year and a forecast released today predicts it will keep that ranking throughout 2010.
In a state where the employment base shrank 3.4 percent in the first quarter, Augusta's 0.1 percent reduction looked good in comparison. Atlanta, for example, has the state's worst economy and will remain mired in last for the balance of the year.
Augusta's loss of 296 jobs during the last quarter came mainly in manufacturing and construction, along with finance, wholesaling and hospitality.
"This figure was a significant improvement from the 8,500 and 5,600 job losses reported in the third and fourth quarters of 2009," notes the report from the Economic Forecasting Center at Georgia State University.
The new jobs came from professional & business services, retailing and government.
Overall improvement in Georgia's economy will boost Augusta's workforce, too, by 1.1 percent in 2010, even though the state as a whole will still be shedding jobs at about that rate.
The vitality of Georgia's fledgling economic recovery is being threatened by Greece's financial crisis, the oil spill in the Gulf of Mexico and a volcano in Iceland, according to Wednesday's forecast.
Rajeev Dhawan, director of the Forecasting Center, described the threats in terms of fires. The volcano would be a single-alarm fire if smoke and ash ground flights over Europe for an extended period for its potential impact on the state's tourism and airline industries.
More serious is the possible three-alarm "fire" that's the oil spill which could expand to a five-alarm blaze if it completely halts Gulf tourism and oil exploration, triggering more bankruptcies which would be felt in Georgia as the leader of the Southeast region.
"But the fire with the biggest consequences s the one burning across the pond," Dhawan said.
Exports to the countries that use the euro from Georgia totaled $5.1 billion last year to account for 18 percent of the state's exports.
Georgia is already lagging the rest of the United States in job creation, losing jobs in most sectors while the nation was adding them since December. The forecast predicts that trend will continue the rest of the year, raising the unemployment rate here to 10.6 percent.
Shrinking employment in construction and in state and local government is the main reason Georgia's hiring will continue to be weak. The over supply of housing and office space that led to the recession hasn't been whittled down yet, and banks aren't in a position to lend anyway.
Weak tax collections are forcing governments to contract, especially as most of the federal stimulus money has been spent. At 13.5 percent of the employment base, the government sector is as large as the corporate sector. So teacher layoffs and other government cut backs will take fuel out of the state's recovery, according to the forecast.
"A broad-based recovery will begin in 2011 when even the construction sector adds jobs," the forecast states. "Government job creation will remain marginal, but with manufacturing picking up steam, overall numbers will rise."