How has the Savannah economy changed during the Obama presidency?
Before I give some wonky answers to that question, I should note that U.S. presidents are frequently given too much credit and too much blame for economic shifts that happen on their watch.
Presidents sometimes inherit economies with clear positive momentum, so they might end up in the luxurious position of overseeing growth that they did little or nothing to effect.
Sometimes, as in Obama’s case, presidents can come into office when the economy is in rough shape. When Obama was inaugurated in January 2009, the U.S. economy was still reeling in the wake of the housing bust and the financial crisis.
For what it’s worth, I think the Obama administration did a lot of things right in trying to jumpstart the economy, but there were miscalculations, too.
At the end of the day, however, dramatically different policies might have had only limited impacts on the long slog back to a new normal after the deepest recession since the Great Depression.
Even if presidents have only limited influence over the economy, the turnovers between administrations have become important historical benchmarks.
So let’s look at some numbers from December 2016 and from December 2008.
According to data from the Georgia Department of Labor, the Savannah metro area (Chatham, Effingham and Bryan counties) had 157,000 nonfarm payroll jobs in December 2008.
In December 2016, we had 182,500 jobs – an increase of 16.2 percent in eight years.
That works out to annual job growth of 1.8 percent, which is markedly faster than the rate of population growth.
Of course, that yearly average includes some weak years for employment. The nation’s economy exited the recession in summer of 2009, but recoveries from financial crises are notoriously slow. Predictably, the economy has gained steam over the last few years, and we saw a strong 3.9 percent job growth between December 2015 and December 2016, according to data released last week.
Despite the strong growth in recent years, the Savannah economy looks markedly different today than it did when Obama’s first term began.
In December 2008, we had 8,300 payroll jobs in the sector that includes construction employment, but that sector had only 6,100 jobs in December 2016.
Some of that decline might be due to changes in the construction industry, but the numbers also reflect the extremity of real estate speculation before the housing collapse. The Savannah area is still dotted with uncompleted residential developments that were started before the bust.
Employment in financial activities has also stagnated over the last eight years, but that’s no surprise given the irrational exuberance before the financial crisis.
Construction employment might still be lagging, but manufacturing employment in the Savannah metro area has increased from 14,900 jobs in December 2008 to 18,200 last month. Of course, we’ve also seen a jump in jobs in leisure and hospitality — from 19,900 in December 2008 to 27,300 in December 2016. That is certainly rapid growth, but several other sectors have also posted strong gains. Employment in the broad category of education and health services increased from 22,000 in December 2008 to 26,300 in December 2016.
Employment in professional and business services increased from 17,000 in December 2008 to 22,700 in 2016. The Savannah metro area has also seen significant growth in employment in retail trade and in transportation, warehousing and utilities. Government employment was 24,100 in December 2008. That increased to 25,500 in December 2016. Given the robust population growth, that’s a remarkable statistic.
In theory, we should see the number of teachers, sanitation workers, public safety officers and other government jobs increase at the same rate as population growth.
In prior recessions, government employment wasn’t significantly impacted, and public sector job growth typically continued throughout economic recoveries.
As I said in Tuesday’s column, the Savannah economy has been a winner during the current economic expansion, but you don’t have to go far to find Georgia counties that are still struggling with employment stagnation and population loss.
Given the generally robust metro area economy, one wonders if we need a large stimulus package like the one proposed by President Trump, but many areas of Georgia could potentially benefit from aggressive public sector spending.
I don’t have space to discuss other changes to the local economy during the Obama presidency, so I might loop back around to this in a future column.
City Talk appears every Tuesday and Sunday. Bill Dawers can be reached via email@example.com. Send mail to 10 E. 32nd St., Savannah, Ga. 31401.