Michael E. Kanell,

After a shaky spring, the Georgia economy added 3,400 jobs in July, the third consecutive month of growth, the Georgia Department of Labor reported Thursday.

The state’s unemployment rate edged down to 3.6% — the lowest level of joblessness since early in 2001. The rate was 3.8% in July 2018.

Coming a day after a near-panicked sell-off on Wall Street, the report seemed to signal that fears of a recession are premature – at least for Georgia. That 800-point drop in the Dow Jones Industrial Average on Wednesday came because of news from the bond market – a change in yields that has frequently been followed by an economic downturn.

July’s numbers in Georgia were slightly weaker than average for the month, but showed no signs of a downturn, even as pessimists cite the U.S. trade war with China as a growing danger to the economy.

In the first seven months of 2019, Georgia has added 32,900 jobs, according to the Labor Department. During the same period of 2018, the state grew 48,200 jobs.

Job growth has been relatively well balanced. There’s been growth in the higher-paying corporate sector, decent-paying, blue-collar construction jobs, and the hospitality sector, which is often the lower end of the wage scale.

The fundamentals of day-to-day business are not yet showing troubling signs, said Andy Murphy, partner and senior investment advisor at Atlanta-based GENCapital, which manages investments for individuals, families and organizations.

Although the bond market’s recent movements are important and revealing, they are not definitive, he said. “It might be one of many predictors, but I don’t think it’s the only one you should look at.”

To be sure, there are some hints that the economy may be edging closer to the end of its record-long expansion.

In general, economic growth depends on a blend of higher productivity, investment and more workers. And the most important negative signal in Thursday’s report was the continued shrinkage in the state’s labor force: The number of people in the workforce — everyone working or seeking work — has dropped by about 14,000 so far this year.

“I’d like to see the labor force start climbing,” said Mark Butler, the state labor commissioner.

But for Will Peterson, president of Otter’s Chicken restaurants, the most important financial signs are visible every day from behind the counter. “Our sales are our strongest indicator. And for us, the outlook is very strong.”

The company has about 100 employees, roughly three-quarters of them hourly workers, and most of them are students working part-time. Identifying as “fast casual,” Otter’s Chicken has four locations. A fifth is planned — with at least a score of new hires — in Acworth for later this year.

Consumer spending accounts for most the economy, so household finances are crucial to continued economic health. If a recession arrives, restaurant owners could know before economists, Peterson said. “When people start to tighten their belts, eating out is one of the first things they give up.”

Whatever the buzz about trade wars and bond markets, Georgia’s small businesses – which account for most employment – remain optimistic, according to Michael B. Williams, senior vice president at the Bank of America.

The bank’s annual survey shows most business owners are expecting their business to grow over the coming months, said Williams, who manages the bank’s relations with many small businesses.

Loans are crucial for that growth, and the bank expects to increase its lending, he said. “I am pretty optimistic. And year after year, the surveys show more optimism about the Atlanta economy than we have seen across other metro areas.”

What spooked Wall Street investors this week wasn’t news about the nuts and bolts of doing business, it was the so-called inversion of the yield curve. That’s when the interest rate on a short-term bond is higher than on a long-term bond. It often signals investors are concerned about the economy in the near term.

More disturbing would be real-world signals, such as large-scale layoffs, especially in agriculture where trade with China is crucial, GENCapital’s Murphy said.

The number of new claims for unemployment insurance — which typically spike during a recession because of layoffs — last month was 5.6% lower than in July of last year, the Labor Department said.

Overall, the Georgia report is reassuring, Mark Vitner, Wells Fargo senior economist, wrote in a commentary. “The state’s labor market appears to have the wind at its back.”

Georgia jobs added, January-July

2014: 82,600
2015: 53,700
2016: 54,700
2017: 29,700
2018: 48,200
2019: 32,900

Sources: Georgia Department of Labor, U.S. Bureau of Labor Statistics

Georgia jobs added or lost in 2019

Jan: 10,300
Feb: 5,300
March: -700
April: -9,000
May: 3,400
June: 20,200
July: 3,400

Sources: Georgia Department of Labor, U.S. Bureau of Labor Statistics

Georgia’s unemployment rate for July

2009: 10.2%
2010: 10.3%
2011: 10.4%
2012: 9.1%
2013: 8.2%
2014: 7.2%
2015: 5.9%
2016: 5.3%
2017: 4.6%
2018: 3.8%
2019: 3.6%

Sources: Georgia Department of Labor, U.S. Bureau of Labor Statistics

Change in number of Georgians in the workforce, January-July

2015: 17,793
2016: 103,262
2017: 72,995
2018: 5,434
2019: -13,695

Sources: Georgia Department of Labor, U.S. Bureau of Labor Statistics, staff research

View article on The Atlanta Journal-Constitution

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