Georgia Southern University’s latest Economic Monitor, which analyzes Q3 2019 data and identifies trends affecting the regional economy, reports that the Savannah metro economy "expanded during the third quarter of 2019, reversing a modest dip in the second quarter."
“Growth in electricity sales and port activity boosted regional economic activity, offsetting some softness in retail sales and tourism,” says Michael Toma, Ph.D., Fuller E. Callaway professor of economics. “Slowing growth through mid-2020 is expected, but the cautionary signal sent by the decline in the forecasting index should be monitored for potential intensification in upcoming quarters.”
The Savannah metro economy expanded 0.8% during the quarter. "The index was primarily supported by strengthening port activity and strong sales of electricity to regional commercial, industrial and residential users... While both retail sales and hotel and motel room rentals slipped, as compared to the second quarter, both indicators remain above year-ago levels," the Monitor says.
"While the trade and tariff spat has disrupted Georgia’s trade with China and contributed to recent volatility in port activity, shipping through Georgia Port Authority’s facilities registered strong growth of nearly 9% when compared to the previous quarter. Port activity stands roughly 7% higher than year-ago data," the report says,.
Total employment in Savannah’s three-county metro area was 185,700, a gain of 200 jobs from the previous quarter. Employment is 1% higher than a year ago.
"Employment in business and professional services continues to erode, shedding another 700 jobs and falling below 20,000 workers for the first time since mid-2016. Overall, the sector has lost 2,700 jobs during the past six quarters," warns the Monitor.
"If this trend continues, it is likely to reduce total employment in the region, as increasing shrinkage in this sector becomes more and more difficult to offset with growth in other sectors."
Hourly wages in the private sector "held steady at $22.65 and appears to have reestablished stability after declining through much of 2018. The length of the workweek shortened slightly to 33.1 hours," the report says.
Tourism indicators "were mixed again during the third quarter. After adjusting for seasonality, boardings at the airport increased 1.9%, while the number of visitors on organized tours modestly improved after a weak second quarter. However, alcohol sales taxes declined 5%, hotel and motel tax receipts fell 2%, and automobile rental taxes dipped slightly," the Monitor reports.
Total employment in leisure and hospitality returned to 27,400, the largest among the region’s major economic sectors, the report says.
In the labor market, the number of initial claims for unemployment insurance (UI) surged 30% from 405 from 540 in the third quarter. "In better news, the seasonally adjusted unemployment rate fell one-tenth of a percentage point to 3.2%, roughly the same as its year-ago level," the report says.
The Economic Monitor is available by email and at the Center for Business Analytics and Economic Research’s website. To subscribe, send a subscribe message to CBAER@georgiasouthern.edu