Georgia’s economy will see modest improvement in 2011 as the state gains jobs and lowers its unemployment rate, Georgia State University economist Rajeev Dhawan said at his quarterly economic forecasting seminar Wednesday.
Nationally, the economy will expand in the first half of this year by just 2.9 percent, a rate that's slower than a typical post-recession recovery, he said.
Dhawan, director of GSU's Economic Forecasting Center, announced his views at his “Forecast for Georgia and Atlanta” conference in downtown Atlanta.
The economic wild card, Dhawan warned, is unrest in the Middle East, which could spur a spike in oil prices, now hovering just under $100 per barrel, up from about $65 a year ago.
"If oil prices go to $120 and stay there, it would wreck this economy into a mild recession," Dhawan said, predicting that oil prices will likely settle in coming weeks back to current levels.
He said the state's unemployment rate will decline from last year's 10.1 percent to 9.6 percent in 2011. He believes the rate will dip to 9.2 percent in 2012 and 8.6 percent in 2013.
Even though the economy is growing, "if I just went by the employment metric, the recession [in Georgia] has not ended," he said.
The state will gain 47,700 jobs through December, he said, with most growth in the education and health care sectors. But 2012 should see a significant statewide boost in employment with 77,600 new jobs, followed by 83,100 jobs in 2013. That compares with job growth of 100,000 per year in the late 1990s.
Atlanta will see a gain of 37,800 jobs -- 10,800 of them premium, or high-paying jobs -- in 2011, with expected gains of 51,800 jobs in 2012. Dhawan also foresees an increase of 56,100 jobs in 2013.
Dhawan said the housing market, which took the biggest hit during the recession, will continue to lag as consumers are wary of investing in real estate. He believes Atlanta's housing permits will grow by 32.7 percent this year, 36.6 percent in 2012 and 40.5 percent in 2013, which he believes will just be on par with 2008 levels.
- Staff writer Michael Kanell contributed to this report.
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