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20 2024 Savannah Regional Outlook The Savannah Metro Business forecasting index is designed to anticipate regional economic activity during the upcoming nine- month period. The forecasting index primarily is developed from indicators characterizing the regional housing and labor markets but includes forecasting elements characterizing broader regional and national economic factors. Although the forecasting index is trending down toward the end of 2023, there are two significant overlays portending growth in 2024 not reflected in the forecasting indicators for the region. First, the regional economy will be supported by continued manufacturing expansion. Anticipated hiring by Gulfstream, Hyundai, and Hyundai's suppliers will set the stage for extended growth in the Savannah metro economy through 2024. This will be further supported by continued expansion of the logistics industry in the region as the Georgia Ports Authority continues its nearly $5 billion investment in port facilities in upcoming years. Thus, while the forecasting index has been negatively affected by weakness cycling back and forth between housing market and labor market volatility, manufacturing and logistics growth will carry the economy through 2024. Regionally, the labor market remains very tight with low unemployment. Although initial claims for unemployment insurance (UI) increased by about 5% in 2023, the unemployment rate remained stable at 3% because of continued hiring and reabsorption of previously unemployed workers. After unsustainable growth in 2022, wages in the region also normalized back toward their roughly decade-long level, adjusted for inflation. In 2024, employment in the Savannah metro area is expected to increase 2.5%, or about 5,100 jobs. Regional employment growth in 2024 will be governed by manufacturing and logistics hiring along with support from the leisure/hospitality sector and health services. Continued growth in real estate development for logistics and residential construction will further support the construction sector as it adds about 300 workers in 2024. The projected annual unemployment rate for 2024 is 3.3%, up slightly from 2023. Unemployment rates will be held lower than normal by re-absorption of workers into what will be a very tight labor market again in 2024. Turning to population growth, the region's long-run attractiveness as a place to live, work, and retire remains unaffected by short- run business cycles. Population growth in 2024 is expected to be slightly above average, driven by moderate employment growth. For 2024, population growth is expected to be 1.8%, about two-tenths of a percent above the long-term pace of growth since 2000. Population growth in Bryan and Effingham Counties combined is expected to be about 3.3%, continuing the trend of more rapid growth in counties adjacent to the economic core in Chatham County. Bryan County has been one of the fastest growing counties in the state and nation since 2010, a trend expected to continue in 2024. Economic growth in the Savannah metro region moderated in 2023 as compared to the rapid growth of 2022. For 2024, moderate growth is expected to be underpinned by hiring in manufacturing, logistics, leisure/hospitality, and health services. Port-related real estate development and residential development will continue on pace with an uptick in activity as market expectations re-set to normalized mortgage rates after the several years of unsustainably low borrowing costs. 2024 is expected to be a year of above average and stronger economic growth as compared to 2023. Economic Foundations The remainder of the forecast considers expected activity in the six major underlying economic foundations of the Savannah MSA economy. Recall that these drivers are (in no particular order) manufacturing, the port and logistics, tourism, health care, the military, and real estate development. Manufacturing Manufacturers in the Savannah MSA gained approximately 500 workers (2.6%) during 2023. The manufacturing workforce was 19,800 at the end of 2023 and is expected to add about 1,200 workers by the end of 2024. A review of recent announcements from headlining companies in the sector points toward another strong year in 2024. Hyundai Motor Group Metaplant America (HMGMA) announced the development of a $7.6 billion electric vehicle assembly and battery plant in Bryan County expected to begin production in early 2025. Upon build-out, the 3,000 acre site will host 16 million