Showing posts with label savannah economy. Show all posts
Showing posts with label savannah economy. Show all posts

Thursday, January 28, 2021

Job losses in 2020 concentrated in larger metro areas in Georgia

 

Map source: By DoubleZ OTP - Own work, CC BY-SA 4.0, https://commons.wikimedia.org/w/index.php?curid=89173265


In 2020, Georgia recorded a net job loss of 77,700 jobs, before seasonal adjustment, which represented a 1.7 percent decline over the year. The net loss of jobs was the first recorded for the state since 2009.

Job losses were not evenly distributed across the state. The effect of the coronavirus on job growth and losses in 2020 becomes obvious when comparing statewide job losses to those in the metro areas of the state.

The Atlanta metro area, which constitutes the state’s largest labor market, accounted for more than 90 percent of the state’s net losses in 2020 resulting in a decline of 2.5 percent (-72,500 jobs). For more than a decade, the story in Georgia has been the persistent job gains occurring in large metro areas compared to more rural parts of the state. Before 2020, the last year where the Atlanta metro area put in a worse annual jobs performance than the state was in 2009.

The state’s second largest metro area, Augusta, experienced an even larger decline as its jobs market saw a 4.1 percent drop over the year resulting in 9,900 fewer jobs than in December 2019.

The Macon and Savannah areas suffered losses but the percentage declines in their labor markets were smaller than the state as a whole. The Savannah area saw a net job loss of 1,200, which translated to 0.6 percent drop. The Macon area recorded a loss of 1,600 jobs, which represented a 1.5 percent drop in its job market.

Three of the state’s smaller metro areas posted net job gains over the year. They included Valdosta (1,900), Rome (400), and Hinesville (200).

An exception to the larger employment drops being concentrated in the larger job markets was Brunswick. The southeastern Georgia coastal area recorded the worse performing job market among metro areas in the state in 2020. The Brunswick metro area saw jobs drop by 5,200 or 11.6 percent.

The Brunswick area saw large percentage employment declines in its goods-producing sector (-7.3%), private service-providing sector (-14.6 percent), state government (-5.6 percent), as well as local government (-5.8 percent).

Information for this report was provided by the U.S. Bureau of Labor Statistics. www.bls.gov.


Monday, June 18, 2018

Trade Wars? Savannah, Georgia, should be worried


Since the last recession, the Savannah area has been on a growth spurt.

After suffering through the national recession, the Savannah area has added nearly 30,000 new jobs resulting in employment growth of almost 20% since 2009.

That growth rate is just shy of the Atlanta area’s growth rate and faster than statewide Georgia, which saying something for a state that continually ranks among the fastest growing states in the nation.

Walking east down River Street in Savannah, past the crowds of tourists and the gift shops and restaurants on your right, you might be deceived into thinking that the city’s growth is due to tourism, but the key to Savannah lies in looking to your left as you watch the large container ships that move past the city on the Savannah River..

The Port of Savannah is home to the largest single container terminal in North America with the largest concentration of import distribution centers on the East Coast, according to the Georgia Ports Authority.

This is a city that remains dependent on trade.




Employment based on moving goods

Although nationally services are now a larger contributor to GDP than goods, the movement of commodities and goods, imports and exports, remain the lifeblood of ports like Savannah.

Significant numbers of workers are employed moving the millions of pounds of materials and merchandise that flow through the Savannah port each year.

More than 10% of the Savannah area’s workers are employed in transportation and material moving occupations, a much larger share of the area’s employment compared to the 7% share of workers nationwide, according to the Bureau of Labor Statistics’ Occupational Employment Survey.

According to BLS, 17,810 workers are employed in transportation and material moving occupations in the Savannah area. These include:

·         2,110 industrial truck and tractor drivers with wages averaging $40,270
·         2,790 heavy truck and tractor trailer truck drivers with wages averaging $43,170
·         7,270 laborers and material movers with wages averaging $31,550

In addition, there are occupations specific to a port that provide well-above average pay including 280 transportation inspectors with an average salary of $65,610 and 180 captains, mates, and pilots of water vessels with an average salary of $77,070.

Savannah’s future tied to its port

"Georgia is home to both the single largest container and roll-on/roll-off facilities in North America." Ports Authority Executive Director Griff Lynch said during the 50th annual Georgia Foreign Trade Conference.

The Ports Authority, which oversees the Port of Savannah, has no plans to slow its expansion. Its executive director recently announced plans to double container cargo by 2028, as reported by the Atlanta Business Chronicle.

“To move that cargo, the GPA's 2028 strategic plan calls for 42 ship-to-shore cranes, new lanes for the gantries that stack containers and a significant expansion of intermodal operations. Ground will be broken next month for a new rail yard at Savannah, while the GPA soon will open its second inland terminal in Northwest Georgia.

Trade through Georgia's ports grew to more than 4 million TEUs last year, up from 2.8 million tons of containerized cargo in 2010. Ro/ro cargo has expanded to more than 640,000 units a year. Cargo of all types crossing all docks has grown from 25 million tons to 35 million tons since 2010.”

Threat of tariffs

All that expansion is threatened if tariffs being proposed by the U.S. and China result in a slowdown of trade. A trade war with China could not come at worse time.

In 2016, the Panama Canal completed its largest expansion since its opening in 1914.

“The Expansion included the construction of a new set of locks on the Atlantic and Pacific sides of the waterway, creating a third lane of traffic and doubling the cargo capacity of the waterway. It also included the creation of the Pacific Access Channel, improvement to the navigational channels, and improvements to the water supply.”


The Savannah port is in the midst of the Savannah Harbor Expansion Project (SHEP), which will deepen the Savannah River to 47 feet at mean low water to accommodate these larger so-called New Panamax ships to better serve Asian markets, and specifically China.

A trade war would be negative to the port in two ways. It could curtail Georgia’s planned future growth that is focused on Asian markets, and it could cause China to shift its exports to Europe thus creating new competition for American goods and commodities that would then have to compete with Chinese goods in the EU market.

So far, the trade war has been all rhetoric with no plans to actually implement proposed tariffs until May or June, giving politicians plenty of time to reconsider their decisions.

WABE in Atlanta looked at the impact of tariffs on the state and quoted Raymond Hill, a lecturer at Emory’s Goizueta Business School, as stating that he doubts the tariffs will make much of an impact here.

“It’s gonna have a little bit of significance probably for, you know, people who grow almonds in California, but even then we’re talking about a 15 percent tariff, so it probably won’t have that much effect, even on the products that were selected,” Hill says.

Maybe living in Atlanta, which is currently in the midst of its own growth spurt, clouds one’s perspective, but a trade war that slows shipping in and out of the Port of Savannah will significantly impact the port and consequently an important part of Georgia’s economic engine.

Fewer container ships finding their way up the Savannah River should raise concerns for everyone in the state.




Thursday, January 26, 2017

Georgia’s job creation machine continues to slow due to job slowdown outside the Atlanta metro area

Georgia 12-month percentage change in nonfarm jobs. seasonally adjusted, 2014-2016

Despite upbeat messages from the Georgia Department of Labor, Georgia’s December 2016 nonfarm employment count only equaled its 2015 job growth and fell below the levels set in December 2013 and 2014, according to new data from the U.S. Bureau of Labor Statistics.

In December, Georgia added 5,900 jobs, seasonally adjusted, the same as in December 2015. Before seasonal adjustment, net jobs dropped by 9,700. In December 2015, the state lost only 2,100 jobs before seasonal adjustment.

As a result, Georgia’s 12-month net increase in seasonally adjusted 103,300 net new jobs with a job growth rate of 2.4 percent, still higher than the national average at 1.5 percent, but the slowest job increase recorded in the state since 2013.

Unemployment

As a result of the slowdown in new job creation, even as the state’s labor force grew, the state’s unemployment rate in December was virtually unchanged over the year.

In December 2016, the state’s seasonally adjusted unemployment rate stood at 5.4 percent compared to a 5.5 percent rate in December 2015, a statistically insignificant difference.

Over the past year, the state added 27,767 people to its labor force, and the number of unemployed grew by 10,648, not seasonally adjusted.

Atlanta Metro Area

The slowdown in job growth was concentrated outside the Atlanta metro area.

In December 2016, the Atlanta metro area added 4,500 jobs, seasonally adjusted and accounted for three-fourths of the state’s net job growth.

Over the year, the Atlanta’s area growth rate reached 2.7 percent, slightly below 2016’s rate of 2.8 percent. For the year, the Atlanta metro area added 70,500 jobs, about the same number of jobs as in 2015.

Other Metro Areas in Georgia

Unfortunately, the state continues to acknowledge the problem of slowing job growth outside the Atlanta metro area.

Three metro areas in Georgia added fewer than 300 net new jobs over the past 12 months. Dalton added 200 jobs over the year, Valdosta added 100, and Hinesville actually has lost 100 jobs since December 2015.

While BLS does not publish a number for nonmetro nonfarm jobs in the state, with the Atlanta and Savannah metro areas accounting for three-fourths of the state’s new jobs and the smaller metros suffering, it is fair to say that the rural parts of the state are suffering at least to the same degree as the small metro areas.

Unless conditions change by an influx of new jobs into the rural and small metro areas, the Atlanta area will continue to be a mecca for state residents looking to escape dead-end careers, and the state will be steadily transformed as economic power (leading to political power) continues to concentrate in the Atlanta area.

Nonfarm Employment December 2016  /  12-months ending in December 2016
(Seasonally Adjusted. Preliminary data from the U.S. Bureau of Labor Statistics.)

Statewide Georgia   5,900      /   103,300
Albany                          -200  /    1,000
Athens                       -1,400  /    1,700
Atlanta                        4,500  /  70,500
Augusta                             0  /   4,800
Brunswick                     200  /      500
Columbus                      800  /    1,900
Dalton                             0    /      200
Gainesville                    600  /     2,100
Hinesville                     -100  /     -100
Macon                          -200  /      700
Rome                            -100  /      400
Savannah                    1,100  /    6,800
Valdosta                       -400  /       100


Tuesday, October 25, 2016

Expect slowdown in growth in the Savannah area, according to Armstrong State University

Armstrong State University’s latest Coastal Empire Economic Monitor is forecasting a slowdown in the Savannah area’s economy, which is bad news for Georgia as the area has been one of the state's strongest success stories, along with the Atlanta and Athens areas.

Savannah metro area nonfarm employment, 12-month net change, Jan. 2009 to Sep. 2016
 
“If we look at the gains achieved in the first half of the year, we can, by comparison, expect growth to slow in the coming months,” said Michael Toma, Fuller E. Callaway Professor of Economics and the Director of Armstrong’s Center for Regional Analysis. “The effects of Hurricane Matthew will further test the resiliency of the economy during the fourth quarter.”

The Savannah area has been one of the fastest growing areas in the state, adding 6,800 jobs over the past year for a growth rate of 3.9 percent, the, but the Center is questioning some of the employment data being reported by the Georgia Department of Labor and the Bureau of Labor Statistics.

According to the Center, “the addition of employment in each of the major sectors (tourism, education, healthcare, manufacturing, etc.) does not match the total number reported for the region by the Bureau of Labor Statistics (BLS). Sector-level employment was stable from the first to second quarter at 177,000 workers, while the total reported by BLS indicates growth of approximately 1,900 jobs during the quarter, to reach 177,500. Much of the reported second quarter gain is anomalous because reported first quarter total employment was less than the total of sector-level employment.

Further, it is likely that regional manufacturing data is currently overreported by as much as 1,000 jobs, and will be revised downward in the annual data benchmarking process conducted by the Georgia Department of Labor in the first quarter of 2017.”

Looking at leading and coincident indicators, positive signs include increasing total regional employment, along with increases in boardings at the airport and a rebound in consumer confidence.

The Center notes that these indicators offset flatness in hotel and retail sales and weaker activity at the port. In the housing market, building permit issuance for single-family homes fell sharply by 10% from the first quarter and was below year-ago levels by the same amount.

The latest report suggests that “expectations about the regional economy’s growth should be adjusted downward through late 2016 and early 2017, due to mixed signals and the anticipated lingering effects of Hurricane Matthew.”

You can read their full analysis here.




Monday, October 10, 2016

Hurricane Matthew’s impact on workers in Georgia? Low-wage service workers will be hit worse than others

Conventional wisdom would say that the hurricane will show few long-term effects on overall earnings but that certain groups of workers will be affected more severely than others.

Low-wage workers in service industry jobs in the affected areas, such as Savannah, will see a decline in their income for the year.


Hurricane Matthew was felt severely in the coastal counties of Georgia. Required evacuations in Chatham County (Savannah) and other counties disrupted some of the fastest growing parts of the state.

In some respects, the disruptions were minimized by the storm coming at the end of the week. Nevertheless, Chatham County schools, which can be seen as a proxy for area’s return to “normal,” were not to reopen until Wednesday, October 12.

Looking at impact, it is tempting to see the disruption as causing a major economic blow to coastal Georgia, and to a less extent, the entire state, but this overstates the true impact.

Looking at impact, it is tempting to see the disruption as causing a major economic blow to coastal Georgia, and to a less extent, the entire state, but this overstates the true impact.

But it is important to note that while overall impact may be minimal in most areas, the effect on earnings will vary for different groups of employees. Low wage employees who do not hold occupations needed for cleanup and recovery will not be able to make up wages lost during the natural disaster, while those employees who do have skills needed for repair and restoration activities should see a net increase in their earnings as the increased recovery work more than offsets the loss of wages caused by the temporary shutdown of businesses during the event.

What conventional wisdom tells us

Here is the conventional wisdom when it comes to dealing with the effects of a natural disaster such as Hurricane Matthew:

Prior to the event, business picks up as consumers and businesses purchase additional supplies in anticipation of shortages. These include food and fuel.

When the event causes evacuations, people leave the affected areas. Within the affected areas, business slows, while there is an increase in economic activity in the areas receiving the evacuees.

After the event, people return to the areas previously evacuated, and economic activity increases above the normal level as people spend money and effort to restore the areas to their pre-event levels.

Over the medium term, the dip in economic activity is cancelled out by the higher-than-usual rise in economic activity post-event.

Depending on the amount of post-event activity, the natural disaster can result in an overall boost to the local economies as they receive an influx of assistance from outside sources such as state governments and the federal government.

By all appearances, Hurricane Matthew should fit this model: Short-term disruption but no longer-term impact.

Effects on workers’ income in affected areas

For workers, the effect of a natural disaster depends, somewhat, on their type of employment. Hourly workers lose income because businesses close during the natural disaster. The cleanup period benefits hourly workers who work in industries that assist in repairing and restoring areas to their pre-event level. This includes construction workers and those in the utility industry who find increased demand and benefit from working more hours and receiving overtime pay.

Low-wage workers in other industries, such as hospitality workers or hourly school employees, suffer longer dips in their pay. They lose income during the time of the natural disaster as businesses slow or shut down temporarily. After the event, businesses in industries such as tourism and hotels, and even higher-end restaurants, find reduced economic activity and so workers in those industries continue to feel the effects.

In most all industries, salaried workers continue to be paid during this time, so their income loss is less. Their income levels feel neither the effect during the event nor see a particular boost after the event.

Workers paid on commission, such as sales workers, lose that business during the natural disaster and even, to some extent afterwards, as cleanup takes precedence over new purchases. Some purchases are postponed, so they are pushed to a future date, while other purchases are cancelled and are never regained.

Effects on workers’ income outside affected areas

For areas taking in evacuees, it means an unexpected but welcome increase in economic activity. These unexpected “guests” purchase goods and services, including hotel rooms, food, and gasoline causing extra work in these areas and creating demand that translates into additional wages for hourly workers in meeting their needs.

Workers in the areas taking in evacuees see a wage “bonus” from the extra demands resulting in a temporary boost to their earnings. When evacuees return to their home areas, this demand slows and earnings return to more normal levels.

Summary

Hardest hit will be low-wage workers who lost wages during the natural disaster and who do not have jobs related to the subsequent cleanup. Those workers suffer a decline in earnings that will not be recovered.

Workers who have skills related to repair and restoration of areas affected by the natural disaster will see a net gain in earnings as work lost due to the natural disaster is more than offset by additional work caused by recovery operations.

While the actual economic impact will not be known for months, maybe for a year, it will be interesting to economists to see how the real impact measures against “conventional economic wisdom”.

It is important that policymakers understand that while the overall impact may not be significant, you cannot overlook how individuals’ earnings are affected by such events.