Next year will be the first since 2007 in which Georgia gained jobs. Weak sectors will still be losing them, only at a slower pace. That would mean it will take eight years to refill all the jobs lost during the recent recession, four years longer than the nation at large, said Robert Sumichrast, the dean of UGA’s Terry College of Business.
The forecast says Georgia will grow 1.5 percent next year compared with 1.8 percent nationally.
The steady stream of people moving into the state will no longer fuel Georgia’s economy, Sumichrast said. He called for more attractive incentives such as tax breaks, low-cost loans and free paving as a way to lure businesses away from competing states in the region.
“Most of you came of age during a time when Georgia regularly outperformed the nation by huge margins,” he said. “Going forward, Georgia is unlikely to substantially outperform the nation unless we change our economic-development strategy.”
Southeastern states are the most aggressive in the nation in the freebies they use to woo businesses. Sumichrast mentioned Georgia’s recent loss of 500 Time Warner jobs to Tampa because of Florida’s incentive package. While he was speaking, Georgia lost another when Chiquita Brands selected Charlotte, N.C., over the Peach State for the new home of its headquarters.
Additional incentives are likely to be a key recommendation in coming weeks to Gov. Nathan Deal from a panel he appointed to seek ways to boost the state’s competitiveness. Panel members have stressed the importance of the concessions as a way to clinch future relocation decisions.
Dennis Lockhart, the president of the Atlanta Federal Reserve Bank, said the U.S. economy will keep expanding at its current rate without much inflation during the next year if European debt doesn’t become a bigger problem.
Both Lockhart and Sumichrast left open the possibility of a recession. Each warned that clumsy fiscal policymaking by Congress could tip the balance toward recession.