Savannah Chamber

42 announced that will almost double its production capacity. Martin's new production line should be up and running in early 2019, creating 36 new jobs. In mid-2017, Hunt Industries announced plans to expand its operations creating about 30 new jobs. In addition, Nature Nate's has been expanding its honey processing operations in Valdosta, creating new jobs. Less positively, Convergys and Rivulis Irrigation Inc. announced layoffs in 2018. The 2019 outlook for hospitality and tourism is excellent, which bodes well for Valdosta's economy. Valdosta will continue to benefit from its location on I-75 as a convenient place for visitors bound for Orlando or Tampa to make their last overnight stay before arriving at their destination. Valdosta's central location between Atlanta, Jacksonville, and Tallahassee also works to the hospitality industry's advantage. Rising markets for most goods implies that the outlook for transportation and distribution industry is positive, which bodes well for Valdosta given the area's location astride critical interstate highway and rail infrastructure. Government earnings account for 35.9 percent of the Valdosta MSA's nonfarm earnings, which is more than double the 16.5 percent share reported for the State of Georgia. That is largely due to the presence of Moody Air Force Base, which is Valdosta's largest employer. The restructuring of the government sector therefore is a potential headwind for Valdosta. The Air Force has talked about retiring the A-10 plane, which is based at Moody Air Force Base, but a recent GAO report suggests that the Air Force has yet to find a cost-effective substitute for the various types of missions performed by the A-10. Nonetheless, the potential retirement of the A-10 must be acknowledged as a serious, potential, threat to the local economy. In addition to a high dependence on federal military spending, Valdosta is extremely dependent on spending by state and local government. State and local government earnings account for 21.5 percent of the area's nonfarm earnings compared to only 11.1 percent for the state and 12.6 percent for the nation. In the Valdosta MSA, local government accounts for 14.5 percent of nonfarm earnings, which is the highest reported for any of Georgia's metropolitan statistics areas. For the state as a whole, local government jobs account for only 7.8 percent of nonfarm earnings. Fiscal austerity could be very tough on Valdosta and is a downside risk for the area's economy. Valdosta is a college town and Valdosta State University therefore is a major driver of the local economy. In FY 2017, Valdosta State University's economic impact was $367 million and 4,594 jobs: 1,451 on-campus jobs and 3,143 off- campus that exist due to university-related spending. The 2017 employment impact (4,594 jobs) is 14 percent higher than in 2012 (4,018 jobs). In 2019, Valdosta State University's excellent reputation will continue to attract many students from outside the region, adding to student spending and to the supply of newly minted college graduates. In addition to generating university-related spending, Valdosta State University raises the area's educational attainment. As educational attainment rises, Valdosta should find it easier to recruit or grow new businesses and industries, especially in its relatively undeveloped technology and high-value added services industries. In the Valdosta MSA, existing single-family home prices peaked in the second quarter of 2008 and bottomed in the first quarter of 2014. The peak-to-trough decline was 16 percent, which was well below the state average. Home prices have been very slow to recover, however. As of the third quarter of 2018, home prices were still 11 percent below their peak level. More positively, home prices increased by 2 percent between the third quarter of 2017 and the third quarter of 2018. In terms of new construction, the upturn in single-family homebuilding began in 2012, gained some altitude in 2013, but lost considerable altitude in 2014. The upturn in homebuilding began again in 2015 and was sustained through 2017. Homebuilding was lackluster in 2018. The 2019 outlook for homebuilders is calls for modest growth, reflecting job growth and positive net migration.

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