Job growth to slow, Georgia State predicts

This year’s job growth will be weaker than last year in Georgia, according to the quarterly prediction issued this morning by the Georgia State Economic Forecasting Center.

Payrolls in the state will add about 95,200 jobs during the year, a little more than one-fifth of them “premium” positions that pay well, Rajeev Dhawan, director of the center, said in a report.

More than 70 percent of the jobs added to Georgia’s economy this year will be in metro Atlanta, he said.

During 2015, the state added about 140,000 jobs, about half in metro Atlanta.

Metro Atlanta’s housing market, which has been on a steady if unspectacular rebound for the past four years, will continue its progress, spurring construction and construction jobs, he said. Permits for new homes are expected to rise 10.3 percent.

However, Dhawan said the key to near-term growth is the relatively weak level of business investment for the past nine months.

The reason for that is a long presidential campaign, he said. “Presidential election rhetoric creates uncertainty that holds back investors, plus the damage from last year’s falling oil prices on equipment investment is showing up in growth.”

Georgia businesses that depend on global economics have faced head winds the past few months. However, Georgia exceeded the pace of national growth last year in a number of sectors, including education, health, hospitality, government and finance.

But Dhawan said he thinks those sectors, which rely on domestic demand, are not getting fuel for robust growth.

“Consumer spending can keep the economy humming,” he said. “The missing ingredient is business investment.”

In his report today, Dhawan predicts the Federal Reserve will pull back from another hike in short-term interest rates at its June meeting. Instead, he said, the Fed will delay the next move until next year.