Earlier this week nearly 700 Atlanta area business leaders, government officials, and chamber delegates heard upbeat national and state business forecasts for next year during the University of Georgia Economic Outlook presentation for 2017. Keynote speaker, Dean Benjamin C. Ayers of UGA’s Terry College of Business, extrapolated the pertinent data prepared by the school’s Selig Center for Economic Growth. 

Thomas J. Cunningham, Chief Economist for the Atlanta Metro Chamber of Commerce, echoed Ayers for the most part with his predictions for the local economy, as he reported an equally positive, upward trajectory for the metro area.

Cunningham noted that the 29-county region, with an output about the size of Ireland, has outperformed the U.S. economy for decades. Atlanta, he predicted, will outpace Georgia’s economy next year, which, in turn, is expected to grow 3.2 percent versus the nation’s 2.6 percent GDP growth rate, according to Ayers. 

One of the key factors in Atlanta’s favor includes investment spending, and even though construction employment locally is still less than the pre-2008 period, demand for housing remains good. 

“Georgia is in real good shape when it comes to government spending,” added Cunningham.  

“Regarding foreign trade, our manufacturers and service producers have high value-added products, which is good, because the world wants high value items.”

“What we have to do, however, is to import both human capital and physical capital into the region from the rest of the United States,” said Cunningham. “We have a labor force issue: we’re aging out of the labor force net. We need talent.” He spoke of the nearly one million millennials who are considering relocating. “We need to come out ahead. We need to be aggressive to bring people in.” 

Many of these predictions are not without risks, however, that could result in a 35 percent possibility for a recession already factored into Ayers’ equation. The wild card may be the economic policy uncertainty of the new administration in Washington, such as the potential for trade wars, in addition to a strong U.S. dollar, higher oil prices, weak foreign currencies, and Federal Reserve interest rate hikes. 

Conversely, other policies might help to improve economic growth through tax reform, regulatory relief, and spending on productivity-enhancing infrastructure. 

Cunningham was less concerned about any recession probabilities for Atlanta, though, because consumption, which represents seventy percent of the macro economy, is relatively good locally. “Low debt to income ratio is good.”

He did express some concern about the potential for discriminatory laws. “If there’s legislation that encourages discrimination in any form, we could end up on a negative growth path before long.” 

The Atlanta Chamber of Commerce Chief Economist returned to his mantra about labor market development at the end of his speech, noting, “Ten million people churn jobs each month. It’s critical for Atlanta to make itself available for workers to relocate. Of that churn, we need to be net positive.”

 

The Georgia Economic Outlook series is the largest outreach program hosted by the Terry College of Business and prepared by the college’s Selig Center for Economic Growth. For 34 years, it has been the premier forecasting event in the state of Georgia. 

In January the economic forecasters will resume their tour of the state, visiting eight cities to deliver local, state and national projections. The schedule and ticket information are available at terry.uga.edu/eo.

The complete Georgia Economic Outlook forecast is available for purchase online at terry.uga.edu/selig.

About John Tabellione

John Tabellione is an award-winning, professional business writer, complemented by over twenty-five years of strategic communication responsibilities as a Marketing, New Business Development and National Account Sales Executive in consumer goods and commercial industries. 

Experience with Fortune 500 companies, as well as with smaller firms and non-profits, encompassing a variety of products, including those of Georgia-Pacific, Kimberly-Clark and Stanley Works. 

John has a B.A. in English from Fairfield University and an MBA in Marketing from the University of Hartford. In addition, he has studied Russian at the Defense Language Institute at Syracuse University, and Italian language and culture at Kennesaw State University.