I gave a talk to the Kiwanis Club of Augusta a couple of weeks ago and one question I received was, “How does Augusta compare to other areas of the state?” At the time, I mentioned the strength of Atlanta and Savannah, but am now in a position to present a more complete picture.
Using the Labor Market Index (LMI) for all metropolitan areas in the state, and for the state as a whole, Augusta is in the middle of the pack. Over the last year (November 2021-November 2022, the latest available data), the LMI has grown at 1.8% in Georgia with Athens, Atlanta, and Columbus growing faster than the state average. Over the last year, the Augusta LMI has grown at 0.5% (see Augusta Business Daily January 10, 2023). Three metro areas saw their labor market deteriorate over the last year: Gainesville, Hinesville, and Rome.
The LMI is calculated using five different measures of labor market vitality: employment, the unemployment rate, labor force, hours worked, and average weekly earnings. All labor markets had some increase in the unemployment rate of between 0.1 and 0.3 percentage points over the last three months but Athens, Atlanta, and Columbus continued to add jobs.
Gainesville and Hinesville saw a decline in all five labor market indicators over the last three months. Rome saw declines in four indicators with employment increasing by 100 jobs over three months.
Labor markets are weakening across Georgia. The LMI for Georgia grew at 2% through August compared to 1.8% through November. Only two metro areas saw the rate of increase in the LMI improve from August, Albany, and Brunswick. Albany increased employment, average weekly earnings, and hours worked. Brunswick increased employment, the labor force, hours worked, and average weekly earnings.
Although labor markets are weakening, it is only a marginal decline in most cases and is to be expected given the strong markets we have seen over the last two years. Federal Reserve policy of raising interest rates was always going to have a braking effect on the labor market as they combat high inflation. The balancing trick for the Federal Reserve continues to be to tame inflation without tipping the economy, and labor markets, into a full-blown recession.
