Recession hit state harder than most

The numbers released Tuesday confirmed just what many Georgians felt: the state took a harder-than-average hit from the recession last year, shrinking at a more painful rate than most of its neighbors.

While losing 3.4 percent of its jobs during 2008, Georgia’s economy contracted 0.6 percent, among the worst performances in the United States, according to the Bureau of Economic Analysis.

“The states where housing slumped from boom to bust tended to have the weakest [gross domestic product] figures,” said Mark Vitner, senior economist at the Wachovia Economics Group.

In the Southeast, Georgia and Florida had the only shrinking economies last year. When the housing bubble burst, both states hemorrhaged jobs in real estate —- accountants and attorneys, as well as brokers and builders.

Georgia shed 3.4 percent of its jobs during the year, a painful flow that has continued into this year. But the litany of loss in Georgia included manufacturing —- where exports were hammered by global recession —- as well as finance and insurance.

Manufacturing employment has been declining for a decade and now accounts for slightly less than 10 percent of the state’s jobs. But the continued contraction accounts for nearly one-quarter of the recession’s job loss, said Don Sabbarese, director of the Kennesaw State Econometrics Center.

“The manufacturing sector has lost almost 50,000 jobs as of April,” he said.

Since slipping into recession in late 2007, Georgia’s job loss has come proportionally faster than national average, though data in recent weeks has spurred hope that the plunge in Georgia’s economy has slowed.

Despite a negative fourth quarter, the U.S. economy ended the year with 0.7 percent growth, the BEA said. In 2007, the economy expanded 2 percent.

Georgia tied with Indiana and Arizona for seventh-worst economy. To the north, the Carolinas expanded modestly. Even next door Alabama squeezed out growth, despite losing 2.9 percent of its jobs, last year.

“But Alabama’s job loss was much smaller than ours,” said Rajeev Dhawan, director of the Georgia State Economic Forecasting Center.