A humming economy has helped lower poverty rates across the country, and Georgia has experienced one of the largest drops, according to a new U.S. Census report published Tuesday.
The number of Georgians living in poverty declined by 2.8 percentage points between 2015-2016 and 2017-2018. Nationally, the dip was 1.1 percentage points.
Only four states - Arizona, Delaware, South Dakota and Tennessee - reported bigger declines. Kentucky also saw a decrease of 2.8 percentage points.
Still, poverty remains a bigger problem in Georgia than nationally. Some 14.7% of the state’s population is impoverished, compared with 12.3% across the U.S., based on a three-year average between 2016 and 2018.
Experts say the reason for Georgia’s improvement is simple: jobs.
Jeffrey M. Humphreys, director of the Selig Center for Economic Growth at the University of Georgia’s Terry College of Business, said over the three-year period, the pace of job growth in Georgia was faster than that of the nation as a whole. The state has reeled in a series of large projects, including a 1,000-job Amazon distribution center, while continuing to see expansion among its home-grown companies.
Georgia has long ranked high in surveys among site selection and development observers for being low in business taxes and generous in business incentives. Its demographics also fuel growth – an expanding population of young people.
Humphreys said the prognosis for growth is good. There are promising plans to expand Georgia military bases and recent data appear to show an upturn in home sales.
The new report was part of a series that the Census Bureau releases annually on the state of the economy. The government also reported Tuesday that the U.S. poverty rate fell last year to 11.8%, its lowest level since 2001.
Georgia is really just making up ground it lost during the recession, said David Sjoquist, professor of economics at Georgia State University.
The state’s poverty rate has now returned to levels of about 10 years ago, before the housing bubble burst and the economy hemorrhaged jobs. By 2012, Georgia’s poverty rate had climbed to 19.2%, the highest in decades, he said.
Georgia has added about 781,000 jobs since the labor market hit bottom in 2010, the year after the Great Recession ended, according to the Bureau of Labor Statistics. Much of the recent growth has been in jobs that can be done by people with limited education or skills – the kind of work that often doesn’t pay that well, but can at least lift a worker over the poverty line.
For instance, Georgia construction jobs grew 6.6% from 2017 to 2018 amid a development boom in Atlanta. Nationally, construction grew only 4.3%, according to jobs data.
During that period, the number of jobs in transportation and warehousing also grew faster in Georgia than in the U.S. And the number of jobs in leisure and hospitality — generally jobs that are open to people with relatively low education and skills — rose faster in Georgia in 2017-18 than in the nation overall.
UGA’s Humphreys said the way to lift even more people out of poverty in Georgia is to improve education, including getting more young people to obtain college degrees or certificates from technical colleges.
“It’s actually very simple and basic,” he said. “Education is everything and the key to getting people of poverty and into a higher standard of living. The key to getting more input is getting a better educated workforce.”
He said the main explanation why the poverty rate remains above the national average is that Georgia is not as productive as the nation. For example, in 2018, per capita gross domestic product - a broad measure of economic output - was $44,723 in Georgia, 12% lower than the national average.
GSU’s Sjoquist said Georgia, and Atlanta in particular, are attracting new residents, moving here for jobs, and they tend to not be impoverished. At the same time, he said low-income, undocumented Hispanics have been leaving.
He agreed that better education would produce a better-skilled workforce, but said there are also other forces at work.
“Another factor in the South is discrimination,” said Sjoquist. “Blacks and Hispanics are paid less than their counterparts. It is not about the same job, but discrimination in terms of the jobs they can get. It is a really, really difficult issue and we are getting better at talking more frankly about race and maybe eventually we will overcome it.”
— Michael E. Kanell and Jennifer Peebles contributed to this article.
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