Gross Domestic Product for Georgia, 3rd Quarter 2020

 

Real gross domestic product (GDP) for Georgia increased at an annual rate of 32.7 percent, according to information released by the U.S. Bureau of Economic Analysis. The percent change was smaller than for the United States as a whole, which grew by 33.4 percent.

The increases in the third quarter followed second quarter declines of 27.7 percent for Georgia and 31.4 percent for the U.S. In the first quarter of 2020, the state's real GDP declined by 4.0 percent, while the U.S. recorded a 5.0 percent drop.

In current dollars, the state’s real gross domestic product in the third quarter of 2020 totaled $627,667 million compared to its third quarter 2019 amount of $629,466 million.

Contributors to third quarter real GDP in Georgia

Economic sectors making the largest contributions to the state’s 32.7 percent gain included:

·         Healthcare and social assistance 3.90 percent

·         Durable goods manufacturing 3.40 percent

·         Accommodation and food services 3.29 percent

·         Wholesale trade 2.92 percent

·         Retail trade 2.36 percent

·         Transportation and warehousing 2.16 percent

·         Nondurable goods manufacturing 2.07 percent

Mining, quarrying, and oil and gas extraction was the only sector recording a decline (-0.01 percent); utilities showed no change over the quarter. 

 

According to BEA, the increase in third quarter GDP reflected continued efforts to reopen businesses and resume activities that were postponed or restricted due to COVID-19. The full economic effects of the COVID19 pandemic cannot be quantified in the GDP estimate for the third quarter of 2020 because the impacts are generally embedded in source data and cannot be separately identified. 

Gross domestic product by state is the market value of goods and services produced by the labor and property located in a state. GDP by state is the state counterpart of the nation's gross domestic product, the Bureau's featured and most comprehensive measure of U.S. economic activity. 

Real values are inflation-adjusted statistics—that is, these exclude the effects of price changes. Contributions to growth are an industry’s contribution to the state’s overall percent change in real GDP. The contributions are additive and can be summed to the state’s overall percent change. 

More detailed information on GDP rates by state can be found at GDP by State | U.S. Bureau of Economic Analysis (BEA).

 

Georgia Job Recovery: Where the Jobs Are and Are Not

 Georgia Nonfarm Employment, January 2019 - November 2020

Source: U.S. Bureau of Labor Statistics

As the job market in Georgia continues to recover from the shock of the Coronavirus pandemic and related temporary and permanent shutdowns of businesses, some industries are coming back at a faster pace than others.

In November, the state recorded a total of 4,561,700 jobs, an increase of 438.000 jobs compared to April but still 110,000 fewer than it contained at the end of 2019.

But while many businesses are not employing as many workers as they did 11 months ago, others have increased their employment.

Which industries continue to grow jobs and which industries end up with smaller net employments is very dependent on the direction of the economy moving forward. While a vaccine may improve the revenue outlook for some industries, economists will be looking to see if shifts in consumer behavior may have lasting effects that permanently shift employment patterns in the state.

Information from the U.S. Bureau of Labor Statistics Quarterly Census of Employment showed that the largest job losses occurred in the Atlanta metro area although even those losses were not uniform among the metro Atlanta counties. Indicators as to whether job markets rebound to their previous levels even as economic activity increases will be important to watch over the coming year.

 

Industries adding jobs

Retail. One of the most interesting recoveries has been in retail. Retail jobs declined by 38,100 between the end of December and April, but since then they have rebounded by more than their earlier losses for a net gain in jobs of 20,900 over the 11 months of 2020.

Temporary employment services. Another industry that suffered large layoffs was the employment services industry as companies cut back on temporary help as business revenues declined. From the end of 2019 to April, the temporary help industry saw a drop of 46,300 jobs. With a sharp pickup in temporary jobs from May through August followed by continued, although mor modest, growth in September, October, and November, employment services have actually added 7,600 jobs since the first of the year.

Ambulatory health care services. As the pandemic increased, the public avoided going to health care providers for non-emergency health services, so outpatient centers and any non-critical health care that did not require an overnight hospital stay saw significant drops in business resulting in layoffs. From the end of 2019 through April, the industry saw a net loss of 25,800 jobs in the state. Since April, the industry has added back 33,300 for a net addition of 7,500 jobs since the beginning of the year.

Industries that avoided large variations in employment

While virtually every industry saw some downturn in employment between January and April, there were industries that suffered less disruption.

Warehouse and storage. Warehouses in the state saw a small decrease of 2,700 jobs between January and April but quickly reversed those losses as more business shifted online. For the 11 months ending in November, the industry has added 7,200 jobs.

Finance and insurance. The industry suffered virtually no employment declines in the first four months of the year, and then began adding jobs. As a result the industry in Georgia is up by 6,000 jobs through November.

Consultants. Businesses engaged in management, scientific, and technical consulting saw a small drop in employment (-3,500 jobs) in the first four months, but then added 3,400 jobs over the next seven months for a net loss of only 100 jobs for the 11 months ending in November.

Private colleges and universities. Non-government colleges and universities saw their decrease come later than other industries in the state with their largest employment downturns occurring between May and August but then adding both those jobs and more between September and November. For the 11 months ending in November, the industry is reporting a net increase of 1,300 jobs.

Industries still reporting significant drops in employment

Some of the hardest-hit industries in Georgia are still showing significant employment decreases for the 11 months ending in November.

Food services and drinking places. Restaurants and bars saw a tremendous drop in employment due to a combination of local requirements that temporarily banned indoor dining, as well as people’s reluctance to go out to eat. Through April, the industry saw a loss of 165,600 jobs in Georgia and is still employing 36,200 fewer people than it did at the beginning of 2020.

Accommodations. Similar to food services, businesses such as hotels, saw large drops in their business and cut back employment with job losses of 23,100 through the first four months of 2020. The lodging business has not returned to prior levels with the result that the industry is reporting 11,300 fewer jobs than it recorded at the end of 2019.

Manufacturing. Employment in Georgia’s manufacturing sector dropped 46,000 in the first four months of 2020 and has only partially recovered with a net job loss of 17,800 as of November.

Professional, scientific, and technical services. This industry lost 20,300 jobs between January and April, and still is down by 13,900 seven months later.

Government. State and local government employment has not been immune to the job losses experienced by private industry in Georgia. Over the 11 months ending in November, state government has seen its workforce shrink by 10,500 while local government education has seen a decline of 14,500 jobs.

 

Georgia leisure and hospitality; arts, entertainment and recreation; and personal services employment and wages affected by pandemic and response in the 2nd quarter of 2020

 By now there is no secret that temporary shutdowns and permanent closures related to the Coronavirus and efforts to combat it fell heavily on Georgia’s leisure and hospitality sector. Over the first six months of 2020, the sector saw a 20 percent drop in employment and a 36-percentage drop in employee total wages. This compares to an 8.5 percent decline in the state’s total workforce and a 12 percent drop in total wages.

The good news is that since the end of June, the leisure and hospitality sector in Georgia has rebounded partially, but it is still important to understand how different industries within the sector fared in the first half of 2020.

Not all businesses within retail trade, leisure and hospitality, or personal services had the same employment effects. Some businesses have actually boosted their employment and payrolls as business increased even as other businesses saw cutbacks and closures.

In terms of providing assistance to businesses during times of pandemic and afterwards, it is important to distinguish both between businesses that suffered and prospered but also to distinguish to what extent employees and payrolls were affected in different parts of each industrial sector.

Retailers - Employment

Retailers in Georgia that normally see employment losses in the first months after Christmas saw those employment and payroll losses continue into the second quarter of the year. Retail employment dropped 5 percent (-25,577 workers) between December and March, and then from April to June, retail trade employment lost another 3.3 percent (-16,098).

As a percentage of the labor force, the worse hit employment groups within the retail trade were clothing and clothing accessories stores, down 27.5 percent (-9,936 workers) in the second quarter of 2020; sports, hobby, music instrument, and book stores, down 16 percent (-2,269); and furniture and home furnishing stores that declined 14.8 percent (-2,691).

In contrast, some retailers saw significant growth in their workforces, including building material and garden supply stores, up 7.6 percent (3,187) and food and beverage stores, which includes grocery retailers, whose workforce rose by 7 percent (6,466).

General merchandise stores that carry a mix of groceries and other merchandise certainly picked part of the trade that might have otherwise gone to more specialized retailers, such as clothing stores, but as the numbers indicate, the general merchandise stores did not add sufficient employment to offset the employment losses by specialty retailers.

The same was true for the category of food and beverages stores, which includes grocery stores. Grocery stores added more than 6,400 people in the second quarter of the year, but this did not make up for the job losses among specialty retailers.

Retail industry groups by change in employment in Georgia from March to June 2020

·         Clothing and clothing accessories stores -27.47% (-9,936 employees)

·         Sports, hobby, music instrument, and book stores -16.04% (-2,269)

·         Furniture and home furnishings stores -14.78% (-2,691)

·         Miscellaneous store retailers -12.9% (-2,790)

·         Motor vehicle and parts dealers -7.89% (-5,391)

·         Electronics and appliance stores -3.88% (-643)

·         Gasoline stations 0.39% (120)

·         General merchandise stores 0.65% (677)

·         Food and beverage stores 7.01% (6,466)

·         Building material and garden supply stores 7.59% (3,187)

Retailers – Wages

As with employment, the total wages paid by retailers in Georgia declined significantly between March and June 2020. With some retail groups paying higher average wages than others, for some retail groups the impact of employment declines showed up differently than the employment impact.

Clothing and clothing accessories stores reported the largest decline in their total wage bill, dropping by more than 37.6 percent in the second quarter, followed by electronics and appliance stores, which posted declines of 22.8 percent.

In contrast, food and beverage stores saw their total wage bill increase by 10 percent, and gasoline stations posted payroll increases of 10.7 percent.

Arts, entertainment, and recreation - Employment

With restrictions on large gatherings of people, along with individuals’ own reluctance to participate in crowds due to concerns about Covid-19 contagion, entertainment and recreational venues have suffered severe employment losses.

Companies in the performing arts and spectator sports business saw the greatest decline in employment, down 37.4 percent (-4,196 employees) in the second quarter followed by accommodation businesses, which includes hotels, that marked a 32.5 percent (-15,554) drop.

Food services and drinking places, which includes both full-service and limited-service restaurants as well as bars, saw the largest decline in the number of employees with the percentage of their workforce dropping by 15.6 percent (-59,789).

Arts, entertainment, and recreation industry groups by change in employment in Georgia from March to June 2020

·         Performing arts and spectator sports -37.42% (-4,196)

·         Accommodation -32.48% (-15,554)

·         Museums, historical sites, zoos, and parks -17.26% (-608)

·         Food services and drinking places -15.6% (-59,789)

·         Amusements, gambling, and recreation -11.9% (-4,319)

Arts, entertainment, and recreation – Wages

Although food services and drinking places saw the largest decline in the number of employees, accommodation saw the largest decrease in its total wage bill, down 48.7%. Food services and drinking places recorded a 31% decline in payroll, while performing arts and spectator sports-related businesses saw their payroll drop by 26%.

Other Services – Employment and Wages

One area that is often overlooked are other services such as personal services and laundry services, membership organizations and associations, and private households.

Personal and laundry services in this category range from beauty salons and barber shops to nail salons, funeral homes, laundry services, and other services such as parking lots. These businesses saw employment drop in Georgia by 18.6% (-7,334) in the second quarter with payrolls declining by 27.6%.

Membership organizations and associations saw employment decreases of 12.5% (-3,306) and payroll drop by 13.7%. Private households, which are defined as including workers employed by individual families, saw a 3.5% decline in employment with payrolls dropping by 7.5%.

About the numbers

Information on employment and total wages by detailed industry is provided by the Bureau of Labor Statistics Quarterly Census of Employment and Wages and provides the most detailed information on American industries. Because of the level of detail and the use of administrative records, the data are highly accurate but are delayed in publication. Current information is available only through the end of June 2020. More information on the QCEW is available at Quarterly Census of Employment and Wages : U.S. Bureau of Labor Statistics (bls.gov).

90 percent of Georgia counties show net job losses in the first half of 2020

 

Over the first six months of 2020, 144 of Georgia’s 159 counties recorded a net loss in jobs. This compares to 56 counties showing job losses in the second half of 2019.

As a percentage of total employment, the largest job losses belonged to Twiggs County (-45%) followed by Warren (-29.5%) and Clayton counties (-22.7%).

Both Twiggs and Warren counties have relatively small labor markets, with Twiggs’ loss resulting in 1,481 fewer jobs and Warren losing 515 jobs. In contrast, Clayton County has a much larger employment base and its loss translated to 28,498 fewer jobs.

In terms of the number of jobs lost, Fulton County (Georgia’s largest county by employment) showed the largest loss with a decrease of 108,000 jobs (-11.8%) over the six-month period.

Oglethorpe County recorded the largest percentage gain in jobs with a 10% increase followed by Crawford County with a 9.7% rise. Both are relatively small in terms of their employment base with Oglethorpe adding 181 jobs while Crawford added 123 jobs over the six months.

In terms of net job gains, Jackson County had the largest increase with 417 (1.4%) new jobs.

Statewide, Georgia reported losses of 8.5% or -391,426 jobs between December 2019 and June 2020.

Clayton County

Among the 11 counties with the largest employments, Clayton County, GA, suffered the greatest percentage in job losses over the first six months of 2020. The county, part of the Atlanta-Sandy Springs-Roswell metropolitan statistical area, is also home to Hartsfield-Jackson International Airport and many of its jobs are located in the services sector.

The county saw more than 17,500 jobs disappear in its trade, transportation, and utilities sector and additional 4,600 jobs were lost in its leisure and hospitality sector, which includes hotels and restaurants.

The only sector to show a job improvement was in manufacturing, which added 477 jobs.

Table of Georgia Counties with net change and net percentage change in employment, 

December 2019 to June 2020