SAVANNAH — Following a note of cautious optimism for the first quarter and a healthy gain in the second, the third quarter Coastal Empire Economic Monitor shows a continued, robust upswing in the area’s economy and improvements across the board.
Steady gains in employment, tourism growth, port activity and improvements in the residential housing market and labor market propelled both the coincident index of economic activity and the leading economic index. The Savannah area saw significant employment gains in the service side of the economy in the private sector, while retail activity held steady and tourism remained solid. In addition, ridership on the trolleys and tour buses increased by six percent from the same time last year. Overall, the third quarter Monitor forecasts continuing economic improvement into the second quarter of 2013.
“Third quarter economic performance was notably strong,” said Michael Toma, director of the Center for Regional Analysis. “The October jobs report extends the momentum established in the third quarter. It is a good sign for the regional economy that employers are beginning to fill gaps in their workforce in response to increased demand.”
Specific increases were seen in the following:
The Coastal Empire coincident economic index increased 1.25 percent to 154.5 from 152.6.
The index is up 2.3 percent for the year with an accelerating growth rate.
Employers added 3,100 jobs during the third quarter, raising total employment to 153,800 (seasonally adjusted).
Job growth was seen in education, health, leisure and hospitality, business and professional services and retail sales.
Manufacturing added 100 workers, while construction lost 100 workers, leading to a steady hold for the goods-producing side of the economy.
Hotel room tax receipts were up, and hotel room rental activity is ahead of last year’s pace by seven percent.
The leading economic index increased 1.4 percent, to 125.1 from 123.3 (revised), marking the fastest three-quarter pace of improvement in three years. This lift came from substantial growth in residential home building permits. The seasonally adjusted number of new residential home construction permits increased markedly, over 34 percent since the second quarter. Residential building permit issuance is 15 percent over last year and is on track to be the best year since 2008.
The fourth quarter outlook is positive, in part because the completion of the presidential election may increase consumer confidence. However, the current debate in Congress could impede and potentially reverse fourth quarter growth in the absence of a resolution that avoids the tax increase and expenditure reduction associated with the so-called federal fiscal cliff.