While the Great Recession officially ended in 2009, Georgia’s unemployment will continue to be high, and another recession could be on the way.
This was part of the message at the annual Middle Georgia Economic Outlook 2012 on Tuesday attended by about 250 people at the Wilson Convention Center in Macon.
Slow growth will remain the mantra in 2012, said Dean Robert Sumichrast of University of Georgia’s Terry College of Business, who provided the forecast for the state.
“We might see continued slow growth or technically, we might see patches of recession,” he said. “Either way, unemployment will remain high.”
Even though net employment in the state is projected to increase by 20,000 jobs this year — and it will be the first annual gain in employment since 2007 — it would only be 5 percent of the total jobs in Georgia lost due to the recession.
“That won’t help Georgia’s unemployment rate improve much,” Sumichrast said. “It will average just over 10 percent in 2012.”
The risk of another recession is higher this year than it was last year, he said.
“Consumer confidence is very low and that alone could cause the recovery to fizzle out,” he said. “Historically, policy mistakes are the most common cause of back-to-back recessions. ... On the plus side, if the economy moves into a recession, it will not be a long or deep recession.”
Trip Shinn, professor of economics, associate director of the Center of Economic Analysis at Macon State College, said there were “a few bright spots” in the local economic data. Shinn provided the forecast for the Middle Georgia area.
Initial claims for unemployment have been dropping for the last year in Macon and Warner Robins metropolitan statistical areas, Shinn said. Macon’s MSA includes Bibb, Crawford, Jones, Monroe and Jones counties, and the Warner Robins MSA includes Houston County.
“Employment and unemployment tends to be kind of a lagging indicator,” he said. “When a recession ends, unemployment doesn’t start falling immediately.”
Some local business leaders say they're optimistic about the year ahead seeing some improvements in the economy.
"I think we bottomed out," said Mike Ford, president of NewTown Macon. "We'll see some moderate growth in 2012. In the long term, we'll need to start more small businesses downtown ... we're looking to add 20 small businesses (in 2012)."
This year is likely to bring more shuttered banks to Georgia, said Mark Stevens, marketing president for Macon-based State Bank & Trust Co.
"Unfortunately, we'll see between 20 to 30 (bank failures) in Georgia that will go into receivership in 2012 and early 2013," he said. "We're beginning to see some improvements in the business sector, but not much activity in people borrowing."
Telegraph business editor Harold Goodridge contributed to this report.