Savannah Chamber

35 18 from the cuts. Nonetheless, Athens remains vulnerable to additional efforts to cut spending should state revenue collections continue to disappoint. In addition, increasing obligations for Medicaid and state government retirees' benefits crowds out state spending for higher education and other traditional programs. More positively, Athens' shares of federal and local government jobs are significantly below the state average. For example, Athens has almost no direct dependence on military spending. Therefore, Athens is not overly vulnerable future efforts to downsize either the federal government or local governments. Of course, Athens will not be immune to future efforts to rein in federal spending. For example, tight federal budgets could restrict the amount of federal grant money that UGA is able to attract. Above-average population growth plus an expanding number of students bodes well for the overall economy, especially homebuilding and residential real estate markets. In terms of new single-family construction, the homebuilding upturn began in 2010 and gained traction in 2011-2013, lost ground in 2014, regained traction in 2015- 2018, but relapsed again in 2019. The single-family homebuilding industry's prospects for 2020 are good, but not great. Multi-family construction has been on the increase, and due to low vacancy rates for rental property, new construction of multi-unit housing is likely to increase in 2020. Because Athens is a college town, millennials and renters play an outsized role in the area's housing market. The Athens MSA ranks 24 th highest among U.S. metros in the percentage of renter occupied housing units – 41 percent are renter occupied. The MSA ranks high in terms of the proportion of multi-unit attached housing, but very low in the proportion of single-unit detached housing. In the Athens MSA, existing single-family home prices peaked in the first quarter of 2008, but did not bottom out until nearly five years later in the fourth quarter of 2012. From peak-to-trough, existing single-family home prices dropped by 19 percent. Home prices reset to where they stood a decade earlier. Since early 2013, Athens' home prices have been on the upswing and in the third quarter of 2019 exceeded their pre-Great Recession level by 23 percent. The year- over-year – 2019 Q3 compared to 2018 Q3 – percentage increase in home prices was 3.8 percent. Single-family home prices will continue to rise through 2020, but at a slower rate than in 2019. Sustained increases in home prices will support consumer spending – especially on home improvements – and entrepreneurial activity. Business expansion and formation requires cash and the typical entrepreneur obtains the funds needed to start, or expand, their business by borrowing, using their home as collateral. Augusta In 2020, Augusta's employment is expected to increase by 1,700 jobs. That is substantially fewer than the 3,600 jobs added in 2019 and 4,100 jobs added in 2018. The 0.7 percent pace of job growth expected for 2020 will be lower than the 1.5 percent pace estimated for the Augusta MSA in 2019, but it will equal the 0.7 percent gain forecast for Georgia in 2020. It helps that a good proportion of Augusta's new jobs will be high-skill, high-pay jobs. The build out of the U.S. Army Cyber Command, the recent opening of the Georgia Cyber Training and Innovation Center, the area's focus on clinical health care, and the area's post-secondary education industries are major positives for Augusta's economic outlook. In addition, the MSA's economy is not very dependent on exports – 4.0 percent of GDP – and therefore Augusta not overly vulnerable to trade shocks. Population growth and net migration have been very strong over 2015- 2019 and that trend will continue in 2020. The focus on government, education, healthcare, and cybersecurity makes Augusta's economy less cyclical than either the state or the national economies. In 2020, Augusta's economy will benefit from the continuation of the controversial construction of two nuclear power plants at Plant Vogtle. Augusta is a center for telecommunications services and call centers, including telemarketing and reservations. University Hospital is rated high performing in five adult procedures and conditions. The Charlie Norwood VA Medical Center and Eisenhower Army Medical Center at Fort Gordon provide critical mass to the area's healthcare industry. The Georgia Medical Authority will use the expertise available at Augusta University to establish Augusta as a center for the rapidly growing life sciences industry. Clarks Hill Lake will be an important factor in retiree- based and second-home development, which will have beneficial spillover effects on the area's healthcare industry. The area's leading high wage industries include the federal government, offices of physicians, waste treatment and disposal, and architectural and engineering firms. Leading mid-wage industries include the military, local government, and state government. Leading low-wage industries include restaurants and general merchandise stores. The Augusta MSA includes Burke, Columbia, Lincoln, McDuffie, and Richmond counties in Georgia and Aiken and Edgefield counties in South Carolina.

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