Savannah Chamber

12 Georgia Outlook 2026 Jeffrey M. Humphreys, Selig Center Director Selig Center for Economic Growth Terry College of Business The University of Georgia Mirroring the U.S. economy, the 2026 baseline forecast for Georgia's economy calls for another year of slow growth. But the state is not as well-positioned to weather the slowdown this time because there's less economic momentum than there was last year and people lack confidence. There are not as many new projects in the economic development pipeline, and demographic forces are far less favorable. In short, Georgia's economy will struggle, and it would not take much to tip it into recession. The risk of that happening before the end of 2026 is 49 percent. If the recession is accompanied by major asset price corrections and/or a financial crisis, then the recession will be longer and deeper than average. Fortunately, there is some upside potential for faster growth if we see a substantial moderation or reversal of protectionist trade and immigration policies. Our forecast calls for Georgia's inflation-adjusted GDP to increase by 1.5 percent, which is about the same as the 1.3 per- cent gain expected for U.S. GDP. Similarly, Georgia's nonfarm employment will rise by 0.5 percent, which is about the same as the 0.3 percent increase estimated for the U.S. Georgia's 4.1 percent unemployment rate will remain below the national unemployment rate. Nominal personal income will grow by 4.5 percent, only 1 percent above the expected 3.5 percent rate of inflation and barely enough to keep the consumer side of the economy in forward gear. The soft labor market will be the main factor behind slower personal income growth, but we expect less support from capital gains, too. Several state-specific forces that typically help Georgia's economy to outperform the nation's economy will not be as forceful. High uncertainty and slow economic growth will reduce the number of economic development projects that the state wins. Stricter immigration policies mean that international net migration is likely to be slightly negative or flat at best. Net domestic migration will slow, too. Trade tensions and slow growth of the global and U.S. economies will hurt Georgia's transportation and logistics cluster. Some factors that favor Georgia will be slightly stronger in 2026, however. Prospects for federal spending on homeland secu- rity and the military are good, so the cities that host Georgia's military bases will benefit economically. In addition, the nation's largest ICE facility is planned for a site near Folkston, which will create 400 jobs. We expect Georgia to get more leverage than most states from an uptick in new vehicle sales. The state's data center industry will provide a larger push to growth in 2026 than in 2025. Georgia is less dependent on federal spending than many states, so federal fiscal austerity should do less economic damage here, but the cuts to the CDC hurt. Some developments will be more problematic: Georgia depends more on global trade than the average state. In most years that is a major economic advantage, but in 2026 trade tensions will be a stronger headwind. Likewise, Georgia depends heavily on real estate development and that sector will be stuck in the trough of a prolonged recession throughout 2026. In addition, we expect home prices to be softer than in states that did not see high rates of home price appreciation in the wake of the pandemic recession. Job growth will be more narrowly based than usual. Health services, private education, data centers, AI, software develop- ment, IT services, cybersecurity, finance, insurance, manufacturing, and local governments will add jobs. Employment will hold steady in transportation, logistics, and utilities. Jobs will be lost in construction, retailing, information, restaurants, hotels, real estate, and the federal and state government.

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