Armstrong State University’s latest Coastal Empire Economic Monitor, which analyzes data and identifies trends affecting the regional economy, reports that the Savannah metro economy returned to healthy growth in the opening quarter of 2017, as the negative effects of Hurricane Matthew dissipated.
Employment, airport travel, retail sales and consumer confidence were especially strong during this period, as was record-setting port activity.
“The regional economy quickly escaped the grasp of Hurricane Matthew in the first quarter of 2017,” noted Dr. Michael Toma, Fuller E. Callaway Professor of Economics and the director of Armstrong’s Center for Regional Analysis. “We should expect even more growth in the summer months, which should be sustainable through the end of the year.”
In the housing market, building permit issuance for single-family homes jumped again for the second consecutive quarter, rising 12 percent from 2016’s fourth quarter, and now stands 6 percent above data from a year ago. The seasonally adjusted number of new residential homes permitted for construction was 496, compared to 444 in the final 2016 quarter. The average valuation of building permits for single-family homes fell 3 percent from $233,000 to $226,000.
Additional highlights from the latest Economic Monitor include:
· The Coastal Empire leading economic index skyrocketed by 2.8 percent from the previous quarter, rising from 154.0 to 158.3. The index was buoyed by lagged changes in residential home building permit issuance, consumer expectations in the South Atlantic states and the U.S. leading economic index. In addition, initial claims for unemployment insurance dropped sharply following the temporary uptick caused by Hurricane Matthew in the last quarter of 2016.
· In the tourism industry, seasonally adjusted hotel room rental revenue dipped slightly in the first quarter. This is likely due to above average hotel sales along I-95 during the fourth quarter as a result of Hurricane Matthew. However, first quarter hotel revenue is still 7.7 percent ahead of data from one year ago and activity should return to trend growth during the second quarter. Other boons include airport travel, which surged 15 percent for the quarter and on an over-the-year basis, and the tourism industry, which has rebounded from Hurricane Matthew and continues to grow. Employment in the leisure and hospitality sector of the economy reached an all-time high of 27,900.
· Total employment during the first quarter averaged 178,500, reflecting an increase of 1,900 jobs from the previous quarter. Business/professional services, leisure and hospitality and retail trade all added over 500 workers each. Manufacturing declined by 100 jobs to stand at 16,500, which is approximately 1,000 jobs below the peak in late 2015.
· Activity at Savannah’s port facilities set records for container volume for six consecutive months (through April). Overall, seasonally adjusted container handling increased 4.6 percent from the previous quarter and was 10 percent higher than year-ago data from the first quarter.
· First-quarter claims for unemployment insurance plummeted 40 percent from the previous quarter, following a sharp uptick in the hurricane’s wake. This is the lowest level seen since the spring of 2000.
The Coastal Empire Economic Monitor presents quarterly economic trends and short-term economic forecasts for Savannah’s Metropolitan Statistical Area (MSA). The quarterly report measures the heartbeat of the local economy, based on the analysis of economic data from the U.S. Census Bureau, the U.S. Department of Labor’s Bureau of Labor Statistics, the City of Savannah, Georgia Power and the three counties in the MSA—Chatham, Bryan and Effingham.
The report presents a short-term forecast of the region’s economic activity in the next six to nine months and is available for free by email. To subscribe, email CRA@armstrong.edu.