UGA forecast: Augusta economy to continue limping

ATLANTA — The Augusta economy will add jobs next year at a modest clip, a turnaround from this year’s contraction, according to a forecast the University of Georgia released Thursday at the kickoff of a series of luncheon presentations around the state.

The university’s Selig Center for Economic Growth in the Terry College of Business prepared the forecast, which calls for the Augusta area’s employment to grow by 0.4 percent in 2013. That would be an improvement over the negative 2.1 percent pace for this year.

The metro area will lag the rest of the state’s 2.1 percent expansion and the nation’s 1.3 percent.

“Strong performance of the metro area’s services-producing industries, notably health care and private education, will be a positive for the local economy,” the economists wrote.

Investment in Georgia Health Sciences University, construction at Plant Vogtle and growth at Fort Gordon in recent years all are combining to strengthen the local economy.

The area’s heavy concentration of federal workers means it won’t be spared from cutbacks in that sector, they warn. Federal civilian and military jobs total 16 percent of the local workforce.

The economists are betting that Congress finds a way to avert most of the impact of the so-called fiscal cliff of steep, federal tax hikes and spending reductions scheduled for Jan. 1.

Local governments – like the federal government – will continue to shrink their payrolls as depressed real-estate values weaken property-tax collections.

The state government has already cut more than 6,000 jobs, however, and now spends 4.3 percent less than it did 10 years ago, according to Gov. Nathan Deal, the luncheon’s leadoff speaker.

“I think it exemplifies in very concrete terms that the state of Georgia is trying to be frugal,” he said.

Terry College Dean Robert Sumichrast said the state’s efforts to trim are one reason Georgia’s economy will outperform the national economy next year. Low costs, tax advantages and friendly government policies will also contribute.

“I think Georgia’s economy will grow in 2013 and grow faster than the nation as a whole. That’s a change from what you’ve been hearing from me in the past five years,” he said. “... Don’t get too excited. We’re only predicting growth a little over 2 percent.”

For the first time since 2000, no sector of private employment will reduce jobs, even though the government sector will. The leisure/hospitality, professional/business services and manufacturing sectors are adding jobs at the fastest tempo. Exports will continue growing, but at a slower rate next year.

But they say small-business owners, who typically create the most jobs, will feel the sting of tax increases and will continue to have trouble getting money to expand.

The school will present the state, national and local forecast in detail Dec. 10 at the Augusta Marriott Hotel.

Weekly unemployment applications drop
US economy grew at 2.7 percent rate in July-September quarter
Unemployment rate unchanged for Augusta in October

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